Long before retailers had to think about blockchain, chatbots and a never-ending list of hyped technologies, the retail premise was relatively simple: right product, right place, right time.
And in a lot of ways, the concept of having the right merchandise available, when and where the consumer wants to purchase it, still holds true today.
The complexity of achieving that, however, has not remained static. Merchandising complexity has reached epic proportions, driven by unyielding and dynamic consumer expectations. We want more products available, faster. Those products – and their pricing – need to take into account who we are as individuals and how we perceive value. And as retailers, we cannot assume to know the true origin of demand simply because an order was placed in one channel and fulfilled in another.
Indeed, omnichannel retailing has turned the entire merchandise lifecycle management process on its head.
Retail Planning Roundtable Is Called to Order
To uncover the top priorities retailers are facing when it comes to omnichannel planning and merchandise lifecycle management, Aptos convened an Executive Roundtable at The Berkeley Hotel in London on 22 May. We welcomed executives from some of the foremost fashion brands in Europe.
Here are the topics we used as a starting-off point for the discussion:
Hyperlocalisation – Most retailers want to be able to offer a more curated customer experience and orient their stores at a local level. The challenge is how to do this accurately and at scale. How are you doing this? Do you have access to the right data to make the right decisions?
Planning in a Fast-Moving Environment – We know the pace of change in retail is unprecedented. How can a fluid and agile planning process that allows for flexibility be achieved without losing the attention to detail that makes you a successful retailer?
Measuring Success in an Omnichannel Environment – Traditional KPIs just don’t cut it anymore. How do you measure success with so many channels fulfilling the customer purchase?
Roundtable Attendees Share Their Top Planning Priorities
When you have a half-day session of robust dialogue, the result is a myriad of learnings, insights and best practices – too many to do them justice in a blog post. In addition to the topics tackled above, recurring themes presented themselves throughout the event.
These five themes, which I’ve summarised below, are what I believe are the most pressing on retailers’ minds when it comes to planning in an omnichannel world:
- Retail Planning: much more than a back-office function
One topic all attendees could agree on was that retail planning touches every area of the business and is central to performance. While planning can be cast as a ‘back office function,’ the ability – or inability – to successfully plan, allocate and assort merchandise has a significant impact on customer journeys. As ‘buy anywhere, fulfil anywhere’ becomes the new reality, retailers need to remove silos in their planning processes and centralise merchandise planning. Once planning is centralised, retailers can set sales/margin targets for all products, brands and channels they serve, while harmonising buying decisions to expected demand.
- A way forward to localised assortments
No matter how carefully managed the in-store experience is, a customer who cannot find the items he or she wants in the right colour or size will walk away disappointed, and is likely to shop a competitor next time. It’s time retailers upped their offerings with localised assortments.
Localising assortments doesn’t mean starting with a chainwide assortment plan and modifying a few choices by market; instead, it requires building a broader number of distinct and unique assortments that are focused from the ground up on each local market and customer base. Attendees agreed that finding the right balance between head office control and local market customisation and empowerment, such as input from a store manager, is key.
- Enterprise-wide data is essential to retail planning (and everything else)
One thing retailers have gotten really good at is gathering data. Lots and lots of data. Retailers are now focussed on how they can remove silos from this data and more effectively capitalise on it throughout their enterprise.For instance, while many executives admitted to having extensive data from their e-commerce and social media channels, they said the data is not often shared and exists only in that channel, for that channel.
It was agreed that retailers must closely align customer data with planning systems. Retailers should consider capturing customer profile data in addition to the purchasing and browsing data they may already own, as a means of continuing to promote both customer centricity and ongoing relevance.
- The best planning software engenders user trust and confidence
As any merchant will tell you, the quest continues to effectively merge the art and science of retail planning.Planning, particularly for fashion executives, remains one of the truest art forms in retail. But as omnichannel has created unprecedented demands on the merchandise office, there is a need for science. And for software.
But even the best planning software cannot overcome a user who does not have confidence in the tool. That is why executives agreed “No Black Box” when it comes to planning technology.
Users need to be able to understand the recommendations the system is making, and the software should be flexible enough to allow user input when appropriate.
Planning software that engenders trust and confidence with users is best positioned to succeed.
- Challenging business environment forces retailers to be better
In closing, I will say what I found the most uplifting about our session was the air of positivity in the room. This was not a downtrodden lot of retail executives, no matter what persists in the headlines about the high street. This was a group of motivated, savvy and customer-centric executives who were ready to take action and utilise the current retail environment as a trigger for improvement. And from Aptos’ perspective, we couldn’t be more delighted to support these retailers on their transformation journeys.