The retail landscape is more crowded than ever before. Competition ranges from digital stores that can ship to any geography and market, to out-of-country retailers setting up shop locally. With so many choices available to today’s consumer, a retailer must adapt to evolving consumer expectations in order to compete and attract consumers.
For most retailers, competitive positioning is based on their brand strategy along with how they engage with customers. Some drive business by cutting price to engage with customers, others compete on the unique nature of their product / experience, while the remainder are struggling to find their competitive edge.
Companies in the third category are often those being punished for a lag in adapting to new technology, and not keeping pace with the change in the habits of consumers. While it can feel like the delta between newer, web-based retailers and traditional retailers is too big to cross – this not always the case. Getting on track quickly, and working with the right technology partners that can help you get there effectively is key to bridging the divide.
Retailers competing on price
When retailers compete on price, it’s difficult to provide exceptional customer experience. Discount retailers are able to offer lower prices by scaling back in other areas. I’m not suggesting it’s only about the price and no attention is given to customer experience, however the emphasis is on price and delivery.
Optimizing operational efficiencies with technology
Competition from digital storefronts is an increasing reality as the barrier to entry, depending on product category, can be minimal if the product is easily sold online. We see this happening for a variety of products ranging from clothing, to glasses, diapers and mattresses. Therefore, competing on price alone is a losing game and tech savvy retailers understand this. These retailers have uncovered how to leverage technology to streamline operations, drive client loyalty and boost profit, while still continuing to offer a lower price point.
Retailers competing on customer experience
On the other end of the spectrum, luxury brand retailers strive to provide the shopping environment and experience that their customers desire and are willing to pay a premium for. There are multiple layers involved in creating an upscale shopping experience and technology plays a key role.
Mobility and Omni-channel
Mobility is an emerging trend for consumers of all types, meaning that the omni-channel experience must always begin by considering the mobile experience. A website and apps that allow seamless transition from a physical store to a virtual one have become basic requirements. WiFi is the backbone to mobility. Easily accessible WiFi on stores’ premises can also be the starting point for collecting data, and then leveraging it to cater to your customers’ shopping experience. Collecting multiple data points such as in-store activity, online commerce (apps and website), device analytics, number of clients in store, location within store, time in/out, and products sold offer a holistic view on the omni-channel consumer. Analysis of this insight allows you to tailor a unique shopping experience.
What does this mean for you?
While new physical and digital retailers emerge daily, we see a large number going out of business due to a failure to exploit technology and stay competitive. To avoid this, now is the time to build the retail experience you need for your customers – and get back in the competition. While technology isn’t the whole story, the right IT strategy will go a long way in helping to build a brand that will drive and sustain business growth.