A customer is for life; not just for the sales

Black Friday. Cyber Monday. Pre-Christmas & January sales. The cold, winter months are enlivened in the world of retail with a shopping bonanza for the savvy consumer. These high-profile sales see shoppers in a frenzy as they seek out the best bargains, both online and on the high street.

Then what? Once the furore has calmed down and normal service is resumed, how do you nurture these customers to ensure long-term loyalty to your brand?

The key is to keep them happy at every step of their interaction with you. They must receive an effortless service, when they want it and from where. More often than not, today’s customers also want instant gratification: to immediately know that what they’ve bought will be with them faster than ever before.

How to achieve this is the topic of a paper that I have recently published, ‘Rethinking your retail business around the customer journey and experience’. In it I make the case for what’s increasingly referred to as ‘unified commerce’. This is true omnichannel retailing (as opposed to just operating multi channels) that sees retailers delivering a seamless customer experience, regardless of which touchpoints they use. Unified commerce demands the fully integration and alignment of processes, systems and applications across both the back office and customer-facing channels.

Theory v reality

While the theory behind this makes absolute sense, the practical reality is that few retailers are truly achieving omnichannel status. The target is to enable a single enterprise-wide customer view, supported by the alignment of product data, pricing, promotion, procurement and inventory management. So why isn’t this happening?

An obvious reason is the siloed approach many retailers take to their operations. With each customer touchpoint (online, in-store, mobile, B2B sales, customer services, etc.) operated as a standalone entity, it is impossible to achieve a consistent customer experience across them. Even the way retail employees are managed in these siloes is a barrier to omnichannel success. As I point out in my paper, to be truly omnichannel, it’s important that all areas of the business are governed by consistent processes, incentives, measurements and ways of working. This means that decisions on remuneration and incentive schemes should be made at the very highest level of the business.

Technology too

The above is very much about a cultural shift, but technology too is an enabler of unified commerce. To deliver repeatedly and reliably at pace, retailers need to invest in cloud-ready infrastructure and they must automate at every opportunity – infrastructure and environment provisioning, application code build, deployment and promotion of application code and, of course, testing.

While cloud-native retailers are set up for this, the same isn’t true of traditional retailers. They are faced with the challenge of marrying legacy with new disruptive platforms and approaches in a genuinely omnichannel model. There are a number of ways to achieve this and, at Sopra Steria, we’re working with many organisations to help them modernise their IT so that they both unlock the value of current systems and keep pace with disruptive new entrants.

In the end, keeping your customers happy, not just during the sales season, but for the long term, begins with how you create and sustain a seamless customer journey. That’s everything customer facing and everything behind the scenes, such as logistics and fulfilment, as well as in the back office.

Download ‘Rethinking your retail business around the customer journey and experience’

For more information on Sopra Steria’s approach to applications modernisation and unified commerce, contact me on Gary.Ellwood@soprasteria.com

Confronting the M&S challenge – why data is the solution

The impact of digital on the retail sector hit home at the end of May when M&S announced that it was accelerating its digital transformation following plunging profits. That one of the UK’s best-known retail brands had clearly failed to keep up with digital consumer trends may have come as a shock to many. I wasn’t surprised, however. I’ve recently written a paper on this very topic. In ‘Why data is the new retail battleground’ I look at one of the key reasons why traditional retailers are struggling to compete with their digital competitors – data.

For me, the challenge is not that these retailers have failed to invest in online commerce channels. Indeed, many are doing well in this respect. What’s holding them back is that they’re still using decades-old back office systems and processes governing Product Lifecycle Management (PLM), Product Information (PIM) and Product Master Data Management (MDM). These retailers, and especially those with a catalogue heritage, retain a large legacy of systems, processes and cultural norms that are not aligned to the expectations of today’s customer. They’ve typically expanded into digital channels to meet the consumer appetite, but they’re being hindered by operating models that remain wedded in their legacy data management principles.

The Amazon effect

To compete with the likes of Amazon and other digital retailers, traditional companies must transform – and they need to do this fast. The ability to capture the right product information quickly and accurately, then push it out to the relevant operational (Finance, Warehouse, Transport, Order Management, etc.) and commercial (Merchandising, Marketing, Pricing, etc.) systems will be critical for this. However, these processes are typically not well managed, or even automated, by many traditional retailer organisations today. Everything from data input, data cleansing and data matching, data enrichment and data profiling, through to data syndication and data analytics, is still dependent on disconnected and largely manual operations.

It’s clearly time to automate those areas of data management that are tying up valuable human resources in manual repetitive tasks. Trying to do what they do now without automation will not work for traditional retailers. In my paper, I describe a set of automation best practice that all retailers should be considering in this respect.

A strategic choice

I also point out that this isn’t just an IT challenge. It is a strategic choice to build a single source of data truth on which product decisions can be made. This is built on an understanding that to remain competitive with responsive and agile operations, every day, organisations need to bring about both technology and cultural change.

Like many traditional retailers, M&S clearly has a number of digital challenges to confront, such as those described above. After announcing its 62% drop in pre-tax profits, the retailer declared it would be modernising its business through ‘accelerated change’ to cater for an increasingly online customer base. I hope it puts data at the heart of this transformation.

Read my paper for more on how to move to a new data-led operating model in today’s fast-moving retail environment.