Developing a strategy for Retail Digital Transformation
What makes digital transformation more critical now for retailers?
Post-pandemic trends among retailers show a large rise in adoption of digital technology for eCommerce. Online shopping has increased at double the speed predicted in 2019, which makes the issue of digital transformation imperative for retailers to address, to shed legacy practices no longer fit for purpose and to adapt their business model to this transformed retail landscape.
How product information management informs digital retail strategy
Digital transformation means treating data as an asset, not simply as a component of your sales channels. Up to now, companies have adopted a piecemeal, ‘make-do-and-mend’ approach to managing their product data, leading to endemic problems during its journey through the value chain:
- Lack of clear onboarding procedures for standardising data feeds from multiple suppliers
- Over-reliance on inherently error-prone manual processing of incoming data as well as manual corrections to incorrect or incomplete data
- Prevalence of substandard omnichannel customer experiences, where unreliable, out-of-date, and incorrect data leads to an inconsistent experience, lost sales opportunities and reputational damage to the brand.
How well you handle the information you have about your product is foundational to any digitisation strategy you adopt.
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What are the best practices?
eCommerce shoppers have upped their expectations considerably in the last five years. An uneven and inconsistent customer experience which does not fulfil basic expectations can cause more abandoned carts, failure to convert, moves to competitors and withering posts on social media. Eliminating pain points in the customer experience can establish you as a trusted retailer – a benchmark reference point. Adopting best practices for internal processes enables the creation of seamless CXs which, in turn, provides a compelling case for the customer to complete their journey with a purchase decision.
Consumers are already evaluating your digital offering from brand messaging, so your product information must be totally consistent and reliable across all channels. Wherever customers search (and the trend is towards much more mobile), they must find quality and consistency. Let’s take fashion retailers as an example of a sector which traditionally leant toward the ‘bricks and mortar’ shopping experience. Post-pandemic, omnichannel has become a powerful tool – using email, social media, and other digital channels allows fashion retailers to inform, influence, and build communities.
But not all business is driven purely by sales at any cost. Digital transformation also helps retailers to adapt cost structures and ensure each link in their value chain is improved, faster, and cheaper. Using PIM as a part of a fully-connected and integrated digital infrastructure, gains in logistics and sales-fulfillment (like click-and-collect), fuel innovative ways of customer acquisition, and help predict demand and get new products on the market fast – a critical element in such a fast-moving and constantly-changing sector.
As part of that integrated digital ecosystem, you need a centralised hub. A PIM, for managing product data, as well as enabling tailored product information to satisfy the myriad channel requirements, governance rules and product hierarchies imposed by marketplaces big and small.
The cornerstones of digital transformation for retailers
Product data quality: digital transformation for retailers requires single- version product data with unimpeachable quality in terms of: consistency, usability, relevance and reliability.
Agility: retailers will need to integrate new technologies and move systems to established and emerging technologies – transformation involves being able to seamlessly integrate product information management software into their existing tech infrastructure.
Cloud: today’s retailers are focusing on cloud-based SaaS solutions so they can scale flexibly while controlling cost of ownership.
AI transformation: a key dimension of digital transformation is use of AI, whose capabilities are advancing practically by the month in areas like process management, analytics, and workflow optimisation.
Integration and unification: Collaboration and interactivity are boosted by cloud-based technology and its capacity to interconnect with any number of legacy systems, applications, or 3rd party platforms. For example, a PIM platform ensures that the guarantee of accurate, up to date, consistent and single version product data (‘The single Source of Truth’) is easy to access and share from a central hub.
Scalability and expansion: Scaling your business is far more feasible when systems are equipped to expand in proportion to the volume of product data, or if you plan to move into new territories and markets. Digital transformation enables expansion at a rate you plan for.
Operational efficiency: Linked to organisation-wide culture change, digital transformation will bring disparate teams together to generate higher productivity through simplified and well-defined workflows, streamlined processes, and robust governance. Its design generates faster, more efficient, and cost-effective internal data processing and management.
The benefits of creating a mindful and comprehensive digital transformation strategy
Customer loyalty is under the control of brands
Customer satisfaction was put to the test by the restrictions imposed during the pandemic, where picking up your tablet or phone to browse retail websites or click on social media links became second nature for vastly increased numbers of consumers. Customers expect their brands of choice to offer not only superior services, but tailored product information. Therefore, generating and collecting customer data becomes increasingly important, and an accurate view of your customers’ usage can be continuously maintained and refined.
Leveraging advances in technology solutions
Using the tools provided by ever more focused innovation in product data management technology, the omnichannel customer experience can be partially automated to provide attributes like:
- customised push notifications
- forecasting market trends
- performing strategic analysis
- leveraging location-based marketing
- offering anticipatory shipping that caters to consumer behaviour across all channels.
Essentially, we’ve all become accustomed to instant e-gratification when shopping online. It would be missing a trick to ignore the opportunities faster, automated and cost-effective cloud-based solutions provide to power that gratification.
Digitally mature companies will prosper
Being savvy for retail businesses means staying ahead of the curve. Businesses with highly developed digital capabilities and access to quality data have already pulled ahead of the pack to win market share. Before developing a strategy, you need to understand how mature your current capabilities are and highlight limitations – after all, with the right consultancy partners, it is possible to be mature in your outlook even when your organisation is not, on the face of it, far along on its journey to be digitally driven.
Rules, regulations and risk management
Retailers, especially those in FMCGs are needing to address the growth in complexity of legal and regulatory requirements – managing this data compliance factor using a PIM solution addresses data privacy regulations (GDPR), terms and conditions, warranties, SLAs, health warnings and ingredients listings – being certain of the accuracy of this critical information must form a part of the strategy to adapt to evolving product offerings.
Building a successful retail digital transformation strategy
The organisational transformation and the digital strategy needed are not just a business plan with digital added in. It is more like installing an updated operating system for the company. The input of all relevant stakeholders is essential for setting clear and concrete long-term objectives. Involve everyone who will be impacted by the changes, from C-suite to budget holders, to the actual end users across the organisation. Listening to their needs will be what influences the degree of buy-in and, hence, the success of the implementation.
Start with Data – your consulting partner for building a retail digital transformation strategy
Whether it’s fashion, food, or furniture, retailers have taken a battering over the last few years. Many companies have adapted on the hoof to survive a health crisis and a super-accelerated mass switch to eCommerce shopping; those who were already implementing a digital transformation strategy emerged better positioned to exploit future opportunities. If you need to move further along the road to digital transformation, Start with Data offers digital transformation services which deploy experienced consultants and partner with technology vendors to speed and optimise the process.
We are ready and willing to assist and guide you on your journey! Get in touch with us and we can have a conversation about how we can apply our expertise to helping you become a retailer whose product information management will sustain competitiveness into the digital future.