The State of Play
Prior to the emergence of Covid-19, many retailers will have been contemplating new omnichannel strategies to increase profit. The two lockdowns that have followed will either have stalled these strategies, with the focus on simply staying afloat, or fast-tracked their progress.
But as we continue to adapt to a life with coronavirus, even with a vaccine in the pipeline, it is clear that retailers need to continue to push forward with omnichannel plans and re-evaluate how they operate in order to continue trading and survive the pandemic.
Change in consumer habits, brought on by increased working from home and reduced socialising, has drastically impacted key trading categories. Various retailers have adapted their product offering, but that does not reduce the stock that has already been bought and is taking up valuable warehouse space.
Moving Forward
Countless retailers will be, and have been, offering promotions and flash sales to shift surplus stock that has accumulated throughout the pandemic.
Black Friday (or Black November) has already started for several retailers, but a month of promoting followed by a Boxing Day Sale cannot and will not fix the problem of surplus stock.
In fact, over-promoting can drastically damage and lower the overall price point that retailers can sell at as consumers get used to a discounted price.
Other retailers may look to increase the number of charity sample sales that they make available to staff, distribution workers, and the public.
But in a world of social distancing, digitalisation is required as sample sales are not feasible in their current format, and while this may reduce excess stock it will not increase profit.
The Answer – Omnichannel Strategies
The aim should be to innovate, expand, and implement new channels.
In conjunction with repurposing their current stock portfolio there is a huge opportunity for retailers to move into new channels and marketplaces to sell stock and drive profit.
As 41% of UK internet users have discovered new brands via search engines and 33% have discovered new brands via retail websites, decision makers should be using the pandemic to profit from the populations increased internet usage and open up their brand to a new range of customers.
Covid-19 has the potential to act as a catalyst for structural business changes for the better, whether that is focusing on supply chain and fulfilment efficiencies or adapting routes to market in order to turn a profit.
The Details
It should be noted that the more omnichannel strategies retailers integrate, the more satisfied consumers are likely to feel and the more value they perceive the retailer to offer. Importantly, customers who shop across a retailer’s sales channels provide a higher customer lifetime value, with multichannel shoppers spending three times more than your average single-channel shopper.
“Either you become a platform, or you become part of one”
Belen Sienknecht – Head of KAM and Sales, Zalando
There are numerous pros to adding new online concessions and marketplaces to your sales process, with the top 3 being:
- Acquire new customers: By increasing the number of opportunities for consumers to discover your brand you increase the possibilities for consumers to buy from your brand – 23% of online shoppers check Amazon for inspiration when they do not have a specific product in mind for purchase.
- Generate new sources of revenue: If an online retailer sells on one more site other than their own then their revenue will increase by 38%. If they sell on two more sites in addition to their own, then that becomes a 120% revenue increase.
- Reduce barriers to entry: Setting up any additional channels online is much easier and cheaper than opening a new brick-and-mortar store.
The Issue
While new channels such as Amazon, John Lewis, and Next may be the answer to selling surplus stock at a higher margin, the technological requirements should be considered. Each channel has its own unique, and often strict, conditions when it comes to product data.
Collating and transforming the data that you have available to you can be extremely time consuming and demanding, and it only gets more complicated as SKU counts and product categories increase. Errors in product data can lead to stock being rejected, fines being issued, and huge delays to stock going live, revenue coming in, and profit being generated.
Lead with Origin (PIM)
To assess the technological structure that needs to be put in place collaborate with Retail247 and implement their PIM (Product Information Management) platform, Origin, which delivers a robust and scalable single view of product data to enable modern retailing.
By introducing Origin to your business, you can transform your existing product data into the needs of concession partners such as John Lewis, Debenhams, and Next, allowing you to reduce product go-live times and therefore increase sales with the use of automated and validated data.
“Origin Product Management gives our users the ability to build their own data translation logic, adapting our own business data to multiple host partner needs”
Ian James – CIO, Reiss
At the heart of Origin is the concept of data repurposing. Data Mapping and Validation Gateways combine with monitored Outbound Data Channels to provide product data in the format and frequency required by external trading partners.
Retail247 understand that these formats are varied and fluid, so Origin has been designed to remove the pain of channel integration.
Logically, product data should all be in one place, with only one version of the truth. Origin is designed as the single repository for everything related to the product, including digital asset management, attribution, and pricing. Used as a point of consolidation or as a point of creation, Origin can be used for data enrichment and control.
Key Benefits of Origin (PIM)
- Single version of the truth for all product data and digital assets
- Flexible product schema and hierarchies to meet the needs of your business
- Highly scalable, cloud based platform
- Manage and store all digital assets
- Control complex product attribution
- Execution of all price change activity across multiple channels
- Workflow to manage stages of product build and enrichment
- Increased turnover and profit through accelerated speed to market
- Reduced costs through the reduction of errors
- Faster creation of new routes to market
Getting Started
Retail247 can assist with data transformation and technology solutions to ensure products are displayed and deciphered according to both brand and marketplace needs.
Having centralised control and visible foundational retail data has never been more important and the solutions and services offered by Retail247 can help you navigate the new challenges retailers now face.
Retail247 can support retailers to adapt and keep up with how quickly the retail technology industry is evolving and be the ones who lead the way going forward. If you would like more information about how these solutions can help sustain your retail longevity, please get in touch.