The festive period has long been a busy and challenging time for retail. This year, with technological shifts, disruption caused by the pandemic and increasing consumer expectations, there can be little doubt that retailers will need to operate smartly to maximize their success during this period.
This means understanding the technologies and partners that can drive their success, as well as the business models they will need to embrace to operate more efficiently and profitably.
One of the ways to understand how the retail sector needs to evolve is by looking into the challenges retailers face.
At Stefanini, we recently conducted a poll inviting retailers to share their main concerns over the festive period, with ‘inventory management’ coming out on top, receiving 35% of the vote.
That should perhaps be no surprise at a time when stock levels need to managed during an influx of demand, while consumer behavior is likely to prove difficult to predict in the face of potential restrictions or nervousness about new variants of Covid-19.
With research showing that the majority of customers would simply order from an alternative retailer if an item is out of stock, falling short when it comes to inventory management means unhappy customers and missed sales.
As a result, the importance of the technological solutions that can enhance inventory management cannot be underestimated.
“Whether it’s omnichannel tracking software, RFID tags to provide greater insight into the supply chain or using AI to model changing behavior, the major challenges faced by retailers during the festive period will typically have a technological solution,” says Iris Gologan, Technical Product Manager for the Retail Industry at Stefanini EMEA.
Responding to omnichannel shopping
The second major challenge for retailers in our poll was omnichannel shopping, which received 31% of the vote.
This is in fact linked to inventory management in the sense that managing stock levels is connected to understanding fluctuating demand across different channels.
Again, the technological solution should be built around better information gathering systems, alongside more efficient procedures and automation.
With shoppers expecting a seamless experience across channels, and potentially modifying their behavior in response to regulations, retailers need to be both future-focused and responsive to change.
Our poll identified loyalty campaigns as the other major challenge for retailers, coming with 19% of the vote. This is equally a challenge of technology and data – success relies on using tools to gain insight into whether loyalty campaigns are profitable, as well as data that allows for precisely targeted promotions and messaging.
As a result, smart investments in technology and expert partnerships will be paramount, especially as disruption and increased expectations means getting the retail experience right becomes both more challenging and more important than ever.
“The festive period is often challenging and we recognize that this is particularly the case this year. The pandemic and recent disruption hasn’t necessarily introduced new challenges – understanding fluctuating demand and adapting in response to the growth of digital retail are established challenges – but these trends have clearly been accelerated. Our research suggests that gaining access to the right solutions, data and expertise will remain invaluable for the retail sector – over the festive period and beyond,” concludes Iris, Technical Product Manager for the Retail Industry at Stefanini EMEA.