Meeting the Demands of Today’s Consumer

Heath HeadshotRetailers are feeling building pressure to meet the demands of customers who expect the latest and greatest at all times. Technology can assist in this effort by reducing lead-time between buying and delivery and providing brands with insightful data about their customers. By Heath Wells

As e-commerce grows, consumers are becoming more and more accustomed to needs instantly being met. Customers want the latest and greatest home décor, sporting equipment, footwear, strollers, and they want it now. One industry exemplifying this retail shift is fashion.

In today’s competitive retail environment, traditional retailers must be empowered to keep pace with the “fast fashion” that consumers crave. Fast fashion is the ability to go from design to in-store in as short an amount of time as possible in order to keep up with constantly shifting consumer preferences while maintaining a consistent turnover of inventory.

Retailers including Zara and H&M have set the precedent in the retail industry and rely on the fast fashion business model, spotting trends and producing them as quickly as possible. Forrester research explains that this accelerated introduction of short-life items, based on current trends rather than dictated by seasons, drives more intense customer engagement in all retail sectors. In order to successfully achieve this type of quick inventory turnover, brands must be able to produce and sell out product effectively, while buyers must have the ability to discover product and make purchases on a regular basis.

The move from seasonal to real-time planning

Technology allows brands to streamline business operations and improve communication with manufacturers and retailers, reducing the lead time between buying and delivery. Traditional brands sell product pre-season, often at tradeshows or showrooms, but this doesn’t work for this new retail model.

By relying on tradeshows, retailers are limiting their discovery of new brands and products to once or twice a year, leaving plenty of time for trends to come and go. Additionally, retailers don’t want to risk committing to a product so far ahead of season and prefer to make more frequent orders to reduce inventory risks. Shifting this discovery and purchasing process online means placing smaller orders more often and more quickly, in-season rather than pre-season, reducing time between discovery and getting the product on the shelf. 

Additionally, traditional fashion brands often sell from printed catalogs, take handwritten orders, and manually enter them into a tracking system. Even when buying does happen in-season rather than pre-season, these process inefficiencies can prevent retailers from getting the right inventory into their stores at the right time.

With this manual process, brands may overlook or underutilize valuable product and inventory data, which can be helpful for sales and trend identification. This outdated process also means that not all data is integrated. With sales history, inventory, and planning data all stored in different places, the selling process is naturally slower. Brands should be able to feed sales, e-commerce channels and retailers a live and accurate product catalog, including inventory positions.

Retailers should rely on their brands for this live, accurate data. Understanding brand inventory allows retailers to maximize every customer opportunity while minimizing stock outs.

Looking ahead

In 2018 and ahead, this instant-gratification model will be an expectation for both retailers and consumers across the retail landscape. In fashion, we can expect to see more brands entering the arena, like Amazon, who recently launched the line “Find” in the UK, which is poised to compete directly with H&M and Zara. Brands that don’t typically deliver fast fashion will use technology to manage inventory and sales, allowing them to join in and more quickly meet demands.

But this model certainly isn’t limited to fashion. We’ll see more and more retailers across sectors who will participate in trend identification and in-season purchasing. As retailers and brands streamline processes through use of e-commerce platforms, both sides will rely more on data to ensure they’re on trend and prepared to meet customer demands.

As Forrester explains, retailers that diligently track transactions can analyze this data and use it to guide pricing and promotion tactics. Beyond this, they can analyze inventory data to learn more about customer preferences and apply these patterns to future trends.

There is an undeniable shift in the retail industry, and both brands and retailers are evolving to adapt to consumer expectations. Traditional retailers and brands are learning to leverage technology to streamline communication, inventory, and ordering processes in order to stay relevant and keep pace with ever-changing preferences.

Heath Wells is co-founder and co-CEO of B2B e-commerce platform NuORDER.

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