To Move Forward, Retailers Should Go Back to Basics

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By Mike Grimes, CRO at Mobee

Retail’s BIG Show did not disappoint with the newest in artificial intelligence, connected devices and augmented and virtual reality. These cutting-edge technologies hold unbridled promise for the retail industry. We will no doubt see and hear more about drone delivery, interactive dressing rooms, the endless aisle 2.0 on in-store mobile devices and even virtual retail locations in your living room.

Yet amid the buzz and excitement of new technologies are gloomier headlines about the demise of brick-and-mortar staples. Macy’s, Sears and The Limited all announced store closures in the new year, citing a decline in shopper traffic and the rise of e-commerce. Footprints are shrinking and so are store sizes, yet shoppers are demanding the same or expanded inventory.

As noted by Carrie Ask of Levi Strauss & CO and published on NRF, “Retail store traffic may be declining, but purchase intent is rising since people don’t ‘have to’ go to a physical store anymore. That makes the accuracy of shelf-level inventory in-stocks more important than ever.” Add that the value of omnichannel customers increases with the number of channels they use, and an optimized offline presence becomes even more important.

The takeaway? Omni-channel retailers need to do a better job with the limited physical space they have. Technology can help—when deployed correctly. Before tacking on new and innovative features, retailers should use solutions like mobile crowdsourcing, RFID tags and mounted sensors to improve the basics of store-level experience.

Here are three places to start:

Inventory Control

Despite advances in technology, it’s still surprisingly difficult for many retailers to manage and prevent inventory control issues. Retailers seeking to understand and engage consumers are losing $1.75 trillion a year due to out-of-stocks, overstocks and returns, according to a recent KPMG report. While this certainly shows you can’t sell product if it’s not on the shelf, it’s also reflective of sales associate time spent on inventory control, instead of on interfacing with customers. 

Having products on the shelf that consumers can see and interact with is a distinct brick-and-mortar advantage and valuable piece of customer experience in-store. Unresolved issues spell disaster for both sales and brand impression, but technology can help. Retailers should look for technologies that not only verify the presence of merchandise at the shelf, but also streamline the stocking process to free up sales associates to do what they do best – creating a great customer experience.

Merchandising

The message of value and efficiency extends to merchandising activities as well. The look and feel of products at the shelf, and the presence and maintenance of promotional materials like displays are critical not just for brand marketing managers, but for retailers as well. Merchandising compliance is a quantifiable driver of sales; in fact, Mobee data has shown store sales will increase or decrease proportionately to the level of merchandising compliance.

Merchandising is another area where technology can assist. Retailers should look for technologies that not only monitor merchandising compliance, but also mash up unique data sets, correlating merchandising compliance with store sales by location, and recommend solutions in near real-time.

Competitive Pricing

Some 77 percent of U.S. shoppers have used their smartphone in store to help them shop, according to a new survey on mobile shopping from DMI. With the explosion of mobile, consumers today have access to competitive products, pricing, reviews, ratings and more on-demand and in the aisle. Retailers must have a sound competitive pricing strategy to reduce the amount of abandoned shopping carts.

In terms of technology, retailers should look for solutions that account not only for how competitors price products, but also how they stock and merchandise them. The ability to monitor and compare this across geographies, from regional to global, is important as well. 

Omni-channel retailers should not turn their back on brick-and-mortar, but leverage their physical spaces more effectively. Technology is not a panacea, but can certainly help retailers increase the per square foot efficiency of in-store operations. By getting better at the basics, doing more with less and containing costs, retailers can take advantage of all cutting-edge technologies have to offer.

 

Mike Grimes is chief revenue officer (CRO) at Mobee, an offline data and insights platform that uses crowdsourcing to collect, organize and analyze consumer data at scale. With more than 25 years of experience building digital solutions for retail-centric organizations, Grimes leads Mobee’s go-to-market strategy, sales and business development efforts.

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