Retail modernization entails a process of constructive destruction to eliminate legacy models and set up new age business models that have the dexterity to solve today’s problems. Retail modernization is gaining momentum as retailers are continuously reengineering their models to stay competitive and thrive in the new normal. However, successful modernization heavily depends upon a long-range vision and a strategy that predicts and accommodates future needs for sustainable success. Retailers need to approach retail modernization correctly and create the groundwork that provides foundational support for future.
Retail modernization is gaining momentum as retailers are continuously reengineering their models to stay competitive and thrive in the new normal. However, successful modernization heavily depends upon a long-range vision and a strategy that predicts and accommodates future needs for sustainable success. Retailers need to approach retail modernization correctly and create the groundwork that provides foundational support for future.
Retail modernization entails a lot of moving parts, and each part plays an equally distinct and important role. It is not purely about technology, it has more to do with the culture. It is a process of constructive destruction to eliminate legacy models and set up new age business models that have the dexterity to solve today’s problems.
The retail modernization infrastructure should enable retail enterprises to make sense out of fast-changing and multi-dimensional data. Retailers should be able to understand customer behavior and tailor products and services as per their specific needs. They should have load balancers to deal with sudden spike and fall in demand. The underlying architecture should enable them in tracking the physicality of the product and streamlining supply chain and inventory. Intelligently meshed integration should enable them to move huge variety, velocity and veracity, and volume of data in a multiverse, and set up a single of truth for enabling actionable insights.
Another important aspect of retail modernization is omnichannel channel approach to help customers in purchase decisions or contactless payments from multiple channels. The integration should allow retailers in getting a 360-degree view of all applications and orchestrate them in an order for business growth. Successful modernizations also accommodate retail audits to suggest, course correct, and improve retail operations, at every turn. Lastly, enterprises should focus on upskilling the promoters to help deploy technologies and assimilate it in the organizational culture. The retail modernization involves the following concepts:
Wrangling data abyss: The most important part of a retail modernization strategy is a data first analytics strategy. Every retail technology has a different storage systems and file format to store data. Friction arises when one instance of data becomes incompatible with another application. The data engine should be able to process data falling from multiple sources and add some relevance or meaning to it. Doing this can help retailers in making utmost use of data and offering tailored products to the customers.
Streamlining supply chain: The single-biggest challenge specifically in the FMCG space is keeping the seamless flow of supply-chain alive and making the physicality of products available in the most interior parts of the city or villages. They should amp up the force to beat supply chain disruption. Moreover, they should have the infra to move products to multiple locations and keep the products available at source and stores.
Defying legacy: Modern-day retail technologies have a different infra and architecture than the legacy systems available on-premise. The complexity increases when they adopt a SaaS- based technology, which is never compatible with the legacy solutions. Retailers should have a layered integration capability to seamlessly move data between one source and another, thus enabling an ecosystem where these technologies can converse seamlessly with one another. This helps in leveraging the infrastructural advantage of both offline and online channels in a fast and efficient way.
Omnichannel presence: Strong omnichannel presence resides at the heart of successful retail modernisation strategy. High-growth retailers are enabling customers to buy from any channel. They are enabling them with information abundance, making remote payments, and informed decisions.
Auditing store operations: Retail modernisation is not a once and done thing. It is a continuous process which requires under-the-lens evaluation and course correction at every stage. The retailers should leverage virtual retail audit solutions to check the store operations and course correct them to boost sales.
Driving in-store experience: The new phase of retail transformation journey is marked by unique consumer trends. Retailers are deploying phygital solutions & direct connect frameworks, making shopping contactless, and boosting in-store operations with planograms and visual showrooms. Retail customers today want the edge of online shopping in physical stores. On top of it, they expect a more rich, knowledgeable, and entertaining shopping experience. Therefore, retailers will have to build and embrace the virtues of the digital world in their physical brick and mortar stores. The idea is to make the buying process as friction-less as possible.
Upskilling the staff: Last, but the most important aspect of retail modernization is not technology but culture. Retail enterprises face a rebellion from employees resisting against technology adoption. However, they should be able to convince the staff that the technology adoption will solve their problems in the long run and help them in driving sales. Moreover, the staff should be trained on the newly deployed technologies for maximum benefit.
Personalized customer engagement is a crucial driver of sales and customer loyalty. Customers today look for a holistic shopping experience and simplified buying. So, they are going to stick with retailers who can envision omnichannel customer experiences: online pickup, curbside pickup, cash-less payment, etc. To make the modernization more meaningful, retailers must align processes with customer expectations. They should start with the customers, understand their expectations, and move backward for reengineering processes and enabling convenient, intuitive, and frictionless processes that live up to those expectations.
The author is CEO APAC, Denave, a global technology-powered sales enablement organisation, which takes a solution-conscious approach to deliver best practices in sales by leveraging people, processes, technology and innovation to drive revenue.