This post is the first installment of a five-part blog series focused on Point of Sale (POS) selections and the corresponding retail strategy. Look for upcoming blogs on POS technology trends, strategies, cost benchmarking, and more.
Historically, Point of Sale (POS) solutions were viewed as transaction tools – a way to scan, checkout and process customer payments. In today’s rapidly evolving retail landscape; however, savvy retailers are capitalizing on advancements in POS technology to better harness customer data for personalization and cross-sell, improve retail process efficiency and increase sales.
The one constant in retail is change
Dramatic growth in online shopping and direct to consumer shipping has prompted many brick and mortar retailers to rethink their operations. Many are blending online and in store channels, including improved mobile technologies, ship to store and in store shipping. At the core of any efficient retail store is the POS system. It must now integrate with a growing number of other technologies, making it more complex to select the right POS system that offers not just the right features, but also integrates with digital, mobile, inventory and a flurry of other technologies and systems. Transactions are also on the rise amongst retailers, adding another layer of complexity to the system integration and selection process. While all of this change can seem daunting, it also presents the perfect opportunity to revisit your core POS system.
Executing a POS system selection
Executing a POS selection typically utilizes a similar structure to any other large software system selection. (See Keith Campbell’s blog for more information on executing a software selection). It’s cookie cutter and to the point, right? Maybe not.
Follow these three steps to ensure you select a POS technology that best supports your retail strategy:
1. Define your vision
- Challenge: Marketplace and customer demands are changing. Customers expect a retail environment that demands more advanced technologies than what a traditional/transactional POS offers.
- Solution: Instead of rushing into a selection, take the time to analyze your customers and products, and ask yourself what the right type of technology is for your business. For example:
i. If you are a luxury fashion retailer, ensuring your associates can quickly and effectively accommodate customer needs, is of utmost importance. Based on this, investing in mobile POS tools makes sense to maximize your associate’s time with the customer.
ii. If you are a fashion retailer who focuses on extended or petite sizes, inventory visibility across stores and channels is critically important. Implementing a POS system that can access all inventory and complete sales in store (and ship to customer, ship to store) becomes a critical focus of your selection.
iii. In both cases above, it would also make sense to look for a POS solution with “clienteling” capability, which allows you to track your customers’ preferences (and remember the guy that wears size 14EW shoes) to make their next experience more personalized.
The bottom line, you should examine the type of in store experience you want to create.
2. Focus on your vision to drive requirements
- Challenge: A key hazard in requirements gathering is focusing on replacing or replicating current state capabilities. This can happen by conducting requirements gathering workshops with questions, such as: “What is the process today?”, “What else can our current solution do?”, or “What are our current pain points?”
- Solution: Instead of developing requirements that replicate current state, the objective should be to focus on the vision you’ve defined and let that inform defined requirements. Requirements meetings should focus on questions, such as:
- What channels do we need to support and what is our channel strategy?
- What kind of brand experience and customer journey do we want to create?
- What do our customers want and how do we deliver it?
- What are our competitors doing that we aren’t?
- How do we enable our associates to be more efficient in store and maximize floor time?
Framing requirements gathering with a strategic and improved future state mindset will ensure your new POS solution places your organization in a better place future state. Speaking of future state…
3. Choose a partner based on their product roadmap
- Challenge: Now that your POS requirements are future state focused, you want to select a vendor whose product roadmap and priorities align with yours. Many times, a selection decision is made when Vendor X meets more requirements than Vendors Y and Z. This is important, but misses a more qualitative partnership element.
- Solution: With technology and market changes, your upcoming five year strategy may be different than your strategy five years after that. When making a POS selection, it’s important to evaluate each vendor’s product roadmap and strategic priorities. Evaluating POS vendors as long term partners (remember you’ll be with them for the next ten plus years) helps ensure that you’ll be working together to reach and advance your long term vision. Consider factors such as the financial health, R&D investment annually to evolve the product, company ownership and M&A considerations that could change the product strategy and the number of customers in your sub-vertical.
A POS selection can certainly be a tactical replacement of one technology for another. Or, if framed correctly, a POS selection can be a strategic, value add project that transforms your retail experience in store.