As an Industrial Engineer with a background in research and an interest in supply chains, I have been keeping abreast of recent retail and distribution news like some people keep up with pop culture. In particular, my interests lie in tracking how technology is changing the face of consumer goods. It goes without saying that over the past decade, the effect of technology on the state of the industry has been immense and widespread, affecting marketing, sales, operations, and security across the board. Among the most contentious and costly topics being discussed in the industry today are the difficulty of providing options for consumer purchasing, fulfillment, and delivery across multiple channels; the collection, monitoring, and securing of consumer data; and the struggle to find a balance between personalization and simplicity that will create a positive customer experience and result in return customers.
Predicting consumer demand has always been a challenge in the retail industry, one that can have a steep cost in excess inventory or missed opportunities. Now, with advances in technology giving rise to purchases across multiple channels (e.g., in-store, online, on a mobile device) there is the notion of omni-channel, creating a seamless experience and meeting demand across all platforms. This change in consumer habits, shifting from in-store purchases to multiple and mixed delivery channels, affects the stocking of stores and distribution centers, order fulfillment and delivery. Issues at any stage in this process can trickle down through the entire supply chain. Whether or not your supply chain is agile enough to handle the shifts in demand can make the difference between a successful campaign and a loss in sales.
As technology changes the way consumers purchase items, it has become increasingly easy to collect data on consumer shopping habits. This has given rise to the phrase big data, the idea of massive amounts of structured and unstructured data collected by companies, often with the intent of tracking consumer trends. The obstacle faced by many companies today is not necessarily the difficulty of collecting this data, but the difficulty of sorting the valuable data from the noise. Consumer purchasing across multiple channels also means companies now face the challenge of synthesizing data owned by separate areas of the business, often stored in multiple locations and formats. Foremost in the minds of many, given the series of recent events, is also the difficulty of securely collecting and storing this sensitive information. As technology continues to advance, companies are forced to stay ahead of the curve in order to protect consumer data or risk showing up on the nightly news.
As customers increasingly interface with companies through technology, it is more important than ever to understand the strengths and weaknesses of these interactions. In order to earn and keep loyal customers, companies are turning to the idea of customer centricity, focusing on creating a personalized customer experience while maintaining a clear and simple ordering, tracking, and delivery process. It is easier than ever to personalize the consumer shopping experience, and it is easier than ever to overwhelm consumers with a complex experience that drives them away. As consumers recognize that goods can be delivered faster than ever before, companies are struggling to reconcile demands for free and fast shipping with the cost of providing this service. While some companies are focusing on specific areas of the customer experience, it is also important to have a plan to communicate with customers when something goes amiss in this process (e.g., shipping delay, webpage error), and provide a clear and constructive response to prevent customers from jumping ship.
With the growth of technology, the rise in big data, and the shift in focus towards toward customer centricity for consumers in the omni-channel space, it is more important than ever for companies to leverage technology to track and understand consumer demand, and to meet and exceed expectations across the board.
Keep an eye out for the next installment in this series which will take a closer look at omni-channel and how your company can leverage this shift in consumer habits to attract new customers while keeping the loyalty of your customers for life.