Berry Singh, COO and Co­founder, Ace Tur­tle

By re­think­ing the role of the store, re­tail­ers are re­vamp­ing the last mile of de­liv­ery and chang­ing the in-store jour­ney of shop­pers think about their store net­work.

VMRD - - Contents -

Even if e-com­merce is con­ve­nient, fast and of­ten of­fers the best prices, stores still dom­i­nate in terms of cus­tomer pref­er­ences. Ac­cord­ing to a sur­vey con­ducted by Ip­sos and In­shorts, cou­ple of years back, 54% ur­ban In­di­ans said if the cost is same, they would pre­fer to visit a proper re­tail store to buy a prod­uct. Since, most shop­pers want to see, feel and get the prod­uct in­stantly, stores must re­po­si­tion them­selves as the core of the prod­uct ex­pe­ri­ence.

Cus­tomer En­gage­ment – What Works, What Doesn’t

Given the chang­ing de­mand of om­nichan­nel shop­pers, brands have re­alised the ef­fec­tive­ness of in-store tech­nol­ogy in de­ter­min­ing the growth of brick and mor­tar. The fact that con­sumers are al­ready fa­mil­iar with tech­nolo­gies such as ar­ti­fi­cial in­tel­li­gence (AI), aug­mented and vir­tual re­al­ity (AR and VR) has made brands adopt these tech­no­log­i­cal ad­vance­ments in in­store im­ple­men­ta­tion strat­egy. How­ever, the ap­proach has been more to­wards el­e­vat­ing the ex­pe­ri­ence of the buy­ers than im­prov­ing the core func­tion. Draw­ing a par­al­lel be­tween a re­tail store and a restau­rant, one would agree that if the cui­sine is not good enough in an out­let, any amount of add-on fringes to pro­vide a bet­ter am­bi­ence would not work. Sim­i­lar per­spec­tive ap­plies to the re­tail stores. If the core func­tion­al­ity of mak­ing the cus­tomer buy a prod­uct is not suf­ficed, then all the ef­fort of aug­ment­ing cus­tomer ex­pe­ri­ence through VR and AR will be in vain.

There are three pa­ram­e­ters that de­ter­mine cus­tomer sat­is­fac­tion in a store – whether he or she is get­ting the right style, right size and of course the pre­ferred colour. The chal­lenge for the re­tailer lies in get­ting all three of these pa­ram­e­ters ful­filled for a cus­tomer, ev­ery sin­gle time, which can then op­ti­mise store con­ver­sion. This is pri­mar­ily be­cause it is ab­so­lutely im­pos­si­ble for a re­tailer to stock the store with all pos­si­ble com­bi­na­tion of in­ven­tory due to var­ied fac­tors: size of the stores are fi­nite; mer­chan­dise plan­ning as per catch­ment anal­y­sis would not lead the brand to carry all styles; de­mand sup­ply mis­match, etc.

EA – The Win­dow To In­ven­tory

Re­ports sug­gest that only 9.4% of global re­tail­ers of­fer a de­tailed view of a par­tic­u­lar brand’s in­ven­tory. If the in­ven­tory ex­po­sure of the brand can be in­creased then there is a di­rect cor­re­la­tion to in­crease in de­mand for the avail­able mer­chan­dise. Con­sumers de­sire in­stant grat­i­fi­ca­tion, and that is one of the big­gest rea­sons to buy off­line. Hence, the sheer avail­abil­ity of the de­sired prod­uct will be able to drive de­mand, thereby in­creas­ing the con­ver­sion and cre­at­ing a ful­fill­ing ex­pe­ri­ence for the cus­tomer.

One of the key re­tail tech in­no­va­tions which can solve this is End­less Aisle (EA). EA en­ables brands to show­case their en­tire in­ven­tory avail­able to the cus­tomer, ir­re­spec­tive of where the prod­uct is phys­i­cally avail­able by in­creas­ing the amount of ‘vir­tual mer­chan­dise’ that a store pro­vides. End­less Aisle pro­vides an op­por­tu­nity for re­tail­ers to in­crease their store con­ver­sions, show­case their en­tire prod­uct range, op­ti­mise their store sizes, and even look at re­duc­ing the foot­print of their stores. How­ever, im­ple­ment­ing this tech­nol­ogy will re­quire brands to have a sin­gle view of their in­ven­tory in re­al­time. The tra­di­tional or­der man­age­ment sys­tems are ba­si­cally con­fig­ured to link the stores pri­mar­ily to the ware­houses. This of course doesn’t give com­plete ex­po­sure of the in­ven­tory, let alone in­clud­ing de­liv­ery and ser­vice re­quire­ment. With these preva­lent sys­tems, it is nearly im­pos­si­ble to pro­vide an ac­cu­rate prom­ise date to the cus­tomer, or sched­ule or­ders to al­ter­na­tive ful­fil­ment lo­ca­tions. An omni-chan­nel or­der man­age­ment sys­tem needs to have the abil­ity to man­age Dis­trib­uted Or­der Man­age­ment (DOM), thereby ag­gre­gat­ing or­der from mul­ti­ple sales chan­nels and ful­fill­ing from the most op­ti­mum stock point – stores or ware­house. This can fur­ther be en­hanced for the cus­tomer by of­fer­ing click-n-col­lect or home de­liv­ery as ful­fil­ment op­tions. From a tech­nol­ogy

per­spec­tive, cloud-based dis­trib­uted or­der man­age­ment pro­vides re­tail­ers a plat­form ca­pa­bil­ity, en­abling the sell­ing, re­plen­ish­ment, and lo­gis­tics pro­cesses for multi-party busi­ness trans­ac­tions across mul­ti­ple ech­e­lons in a sup­ply net­work. Ad­di­tion­ally, the best DOM ap­pli­ca­tions com­bine multi-chan­nel or­der ag­gre­ga­tion with global vis­i­bil­ity to in­ven­tory, in­clud­ing de­liv­ery and ser­vice avail­abil­ity, en­abling the “com­plete” or­der prom­ise.

Bring­ing Brick & Mor­tar Close To 360 De­gree

For re­tail­ers to com­pete in this age of em­pow­ered con­sumer sce­nario and pure play on­line com­peti­tors, they need to lever­age phys­i­cal stores as ful­fil­ment cen­tres. Phys­i­cal stores give the brands and the re­tail­ers an ad­van­tage their pure play coun­ter­part doesn’t and are at­tempt­ing to repli­cate with re­gional dis­tri­bu­tion cen­tres and de­liv­ery lock­ers. How­ever, many brands and re­tail­ers have not seized the op­por­tu­nity to mo­bilise their phys­i­cal stores to em­brace to­day’s omni-chan­nel shop­per. A net­work of brick and mor­tar stores can put brands one step closer to their shop­pers, both fig­u­ra­tively and phys­i­cally. By us­ing these stores as a ful­fil­ment cen­tre, re­tail­ers can lo­calise ful­fil­ment, keep up with in­creas­ing cus­tomer de­mand and, most im­por­tantly, ex­ceed cus­tomer ex­pec­ta­tions. This prac­tice also lever­ages in­ven­tory ef­fi­ciently. With ac­cess to avail­able stock and com­pa­ny­wide “shar­ing” of mer­chan­dise in near real-time, re­tail­ers now have a means to avoid lost sales due to out- of-stock in­ven­tory. With the av­er­age store con­ver­sion be­ing less than 25%, this could lead to huge fi­nan­cial gain for any brand which is strug­gling to in­crease its com­pany sales growth.

By re­think­ing the role of the store — from putting mis­sion-crit­i­cal data into as­so­ciates’ hands and im­prov­ing in-store op­er­a­tions to tran­si­tion­ing stores into mini-ful­fil­ment cen­tres — re­tail­ers are re­vamp­ing the last mile of de­liv­ery and chang­ing the way shop­pers think about their store net­work. Re­tail­ers that adopt the right con­ver­sion strate­gies are four times like­lier to in­crease store turnover than re­tail­ers that do not. The suc­cess of brick and mor­tar re­tailer de­pends largely on how they adopt win­ning con­ver­sion strate­gies.

Berry Singh is the COO and Co­founder of Ace Tur­tle. Berry an alum­nus of NIFT, was the Busi­ness Head of Tim­ber­land, Paul&Shark, GAS, Dune and Re­tail Head for Diesel. As a found­ing mem­ber of Re­liance Brands, he was re­spon­si­ble for Op­er­a­tions, Sales, Mar­ket­ing and build­ing teams to run these busi­nesses. As COO of Ace Tur­tle, Berry drives day to day op­er­a­tion of the or­ga­ni­za­tion and spear­heads the client ac­qui­si­tion strat­egy for the com­pany.

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