By Peter Dinham Wednesday, 17 August 2011 23:00 IT Industry - Market
In Australia retailers are facing tough times as consumers keep their money in their pockets, and with new challenges posed for traditional ‘bricks and mortar’ retailers by the dramatic shift to purchasing by consumers of all manner of goods and services from overseas, online retailers. But some tips for using technology to help are at hand.
The help and advice for the hard-pressed retailers in all markets comes from IDC’s Retail Insights team who, in their latest market report recommend their top 10 ways for retailers, using technology to prepare for the holiday shopping season.
According to IDC, navigating the advantages that technology may provide in engaging both loyal and new consumers can determine the difference between retailers' ending the year in the red or in the black.
IDC has come up with what it calls its “four IT-enabled mega-trends” to help retailers make better decisions and to help retail IT organisations prepare, including:
• Cloud for cost and scale advantage
• Mobility for unified consumer interaction
• Omni-channel for same-shopper sales growth, and
• Intelligence for better decisions, to help retail IT organisations prepare for the holiday season.
IDC says retailers can put certain initiatives into practice immediately in the areas of e-commerce, store systems, merchandising, supply chain, and product management.
Leslie Hand, research director, IDC Retail Insights, says that retailers can expect consumers to be very discerning in their holiday shopping this year, and this may result in “continued profit pressure for retailers due to excessive or sub-optimal discounting strategies.”
In addition to managing these risks, Hand says that retailers are also faced with fending off competition, sometimes coming from new sources: blurring segments, direct sales from manufacturers, growing e-commerce sales and new entrants, local niche merchants and social commerce web sites.
And, Hand has an extra word of advice: “Retailers must remember to fix what they can now, and prioritize for post-holiday investment what can't be fixed, so they are not similarly disadvantaged in 2012."
The IDC report begins with recommendations to defend against landed cost fluctuations, and Hand says that “as today's rising commodity prices may, in turn, force increases in prices to consumers at a time when economic uncertainty is causing them to remain highly sensitive to price changes.”
IDC also suggests in its full report that to succeed in the dynamic environment leading up to the holiday season, retailers need to focus simultaneously on better understanding and delivering value to their customers; collaborating with their trading partners by providing visibility into trade promotion performance, pricing, inventory assortment, and shopper behaviour; and continuously managing exceptions to planned costs, adjusting retail price, promotions, and allocations as necessary to optimize sell-through, sales, and margin.
Additional technology initiatives for retailers which IDC addresses, include:
• Ensuring price and promotion engines are ready for holiday traffic
• Improving online retailing conversion rates
• Leveraging social media to boost customer acquisition, retention and conversion
• Creating web sites optimized for mobile retailing
