We’ve all heard it before: If you can’t innovate, you’ll get disrupted. While there’s no magic crystal ball that will help retailers predict the future, there are expert opinions on what needs to be done to stay relevant this year.
Here we’ll explore the top trends shaping the retail landscape, and how each of them has the potential to drive in-store sales.
1. Flawless Execution Takes Center Stage
Did you know that a sizable 25 percent of sales are lost due to poor retail execution? Every noncompliant promotion, messy shelf, and incorrect placement amounts to thousands of dollars in potential sales lost. To remedy these errors, many suppliers are equipping themselves with retail execution software.
The most effective retail execution tools employ a virtuous cycle of insights, planning, and actions, where brand reps are collecting data about in-store conditions that managers can analyze to implement rapid changes at the store level, territory level, or brand level. While this system has obvious benefits for supplier brands, it’s a win-win scenario for their retailer partners too. When in-store presence is perfect, the sales potential grows exponentially.
2. Suppliers Get Savvier With POS Data
In a similar vein, suppliers are leveraging syndicated point of sale data in a collaborative fashion with their retail accounts. Consider the following examples of successful data sharing:
- realizing the correlation between a given promotion or other in-store activity and a sales lift
- drawing conclusions about which in-store placements are the biggest sales drivers
- monitoring sales data closely to catch out-of-stocks quicker
- improving seasonal forecasting from an analysis of historical sales data
Numbers don’t lie. Transparency between retailers and suppliers around sales results fosters a data-driven mentality that leads to better performance.
3. Experiences Are Having a Moment
Everyone’s favorite shopper demographic (looking at you, millennials) is rampant with purchasing power. It’s this consumer group that is dictating how retail should evolve. One of their demands is a memorable experience. Retailers that position themselves as sellers of emotions rather than sellers of commodities are at an advantage.
Chains like Sephora have launched augmented reality (AR) apps where customers can “try on” products before purchasing. Similarly, companies like Wayfair have developed technology that allows customers to see what a piece of furniture might look like inside their own home. If investing in sophisticated technology to deliver an experience seems out of reach, there’s always the sampling strategy. Even the busiest shopper will stop dead in their tracks to take something for free, with sampling events proving a 74 percent increase in same-day sales.
4. Blockchain and Supply Chain Go Hand-In-Hand
Blockchain’s emersion as a secure form of record keeping is gaining popularity in several industries, and retail is no different. The retail supply chain in particular has a lot to gain from adopting blockchain technology. Whenever a finished good moves on from one party to the next, that transaction is documented in a way that cannot be later altered or deleted, increasing security and reducing human error throughout the entire commerce process.
Blockchain has the capability to improve accuracy in several areas of the supply chain including the recorded number of pallets or containers transferred and the documentation of purchase orders or receipts. It also has the power to promote trust between parties since there is an unbiased record of every touchpoint. Perhaps the best news is that since the technology is still young, the opportunity for innovation has just barely been tapped.
With the dawn of the new year already behind us, there’s no better time than the present to start making instrumental updates to your retail business. At the end of the day, it’s all about delivering value to a new and old clientele.
This article originally appeared as a guest post on Retail IT Insights.