Obviously a major concern for retailers currently is the impact of the economic climate, though the study does highlight how the retail winners differentiate themselves from the rest of the pack during these difficult times, “Winners know that other retailers focus inwardly in stressful times, looking for ways to cut costs and laying low until external conditions improve. Winners however are unwavering in their focus on the consumer.” Investing now whilst their competitors haul down the shutters will put them in good stead for the upturn in the economy.
The top 2 identified inhibitors to becoming an efficient cross-channel retailer indicate the survey respondents recognition that becoming customer-centric is key, as opposed to product and location:
- Inability to effectively use customer information for cross-channel marketing
- Do not have one view of the customer across all channels
The studies section entitled, “Organizational Resistance is Tenacious and Lingers On” highlights the continued issues with getting the organisation onboard with multichannel efforts. I've recently read the book “Fast Strategy” which discusses approaches on how organisations can become more agile, giving examples of recent tech company successes to allow them to adapt quickly to market forces. I wonder how some of these approaches could be applied to Retail.
Retailers are attempting to address their inhibitors, though a later graph in the study suggests there's an opportunity to greatly improve, with 67% of respondents suggesting they still have work to do synchronising customer and inventory information across channels.
On to technology...
Another clear differentiator between retail winners and their competitors becomes apparent when asked about their approach to managing cross-channel data. 52% of winners enter product and customer data into a single system of record and move electronically in to other channels, whilst 71% of their competitors are still entering that information seperately into each channel - clearly the winners have optimised their data processes.
The study highlights how retailers view the importance of real-time customer and inventory data and the need for cross-channel content and product information management, but interestingly the third most important is a modern eCommerce platform. It would be interesting to find out what retailers believe to be a “modern eCommerce platform”, what feature set do they believe such a platform should comprise? Do they think these modern platforms require more Web2.0 features? Or is this a refelction that they feel their eCommerce platform capabilities require further investment?
As discussed in my previous posting, few retailers see adding channels as important in the current climate with a distinct view that mobile is most definitely low on that list. Only 4% of Retail Winners considering it very important, even though mobile operators are predicting significant growth in this area. Could this be the retailers are holding their cards close to their chests, or are the mobile operators just trying to encourage a market in its infancy?
To summarise some of the key recommendations from the study; Winners will continue to invest during this downturn and emerge even stronger, with the help of technology vendors and some creative financing options. Though there are still some key challenges, the most significant, the lingering issue of organisational change to support cross-channel initiatives. To address this will require new metrics and processes to aid alternative compensation structures and promote cross-channel behaviours and attributes.
What are these metrics? The need to track a customers journey across channels and their spends, what product did they browse on the website? Did they go on to buy that product via an alternate channel? – this should be easy for an integrated web to store/phone journey where those channels share that customer information and have the ability to identify the customer at point-of-sale. Though I suspect from reading the study there aren't many retailers out there with that kind of sophisticated integration, or have even considered it a metric to measure – I look forward to being proved wrong.
Again, for full access to the study see the Retail Systems Research website.
