Retail agility: The way forward for retailers
In less than a century, we have seen retail go from the corner store to a world offering customers an integrated shopping experience encompassing e-commerce, mobile shopping and omnichannel retailing. The pace of change has increased rapidly as well. Where previously a seismic retail shift occurred every 10 to 20 years, changes are now happening every few years and they’re coming from multiple angles.
If you think about the businesses that dominated their retail vertical in the first half of last century, many of them no longer exist. This tells us that maintaining longevity and market leadership in retail is exceedingly difficult. We have seen enterprise retailers that dominated their market disrupted by more agile and nimble competitors. It’s happened across a wide range of areas, from Nokia being usurped by Apple and Samsung; Netflix disrupting terrestrial and pay-TV providers; and AirBnB providing an unprecedented challenge to the entire hotel industry.
These are just three examples, but the message is the same. Change is coming from unanticipated quarters and it’s coming from all angles: bricks and mortar, online, mobile and more. This can all make a retailer feel like they’re on the proverbial ‘retail treadmill’, always trying to keep pace but never quite getting ahead.
The key to hopping off the retail treadmill is the concept of retail agility. This is the ability for a retail business to identify change, respond to the change and adapt quickly. Being an agile retailer means you can achieve core business goals including:
● Realising business benefits by focusing on the 360 customer experience and prioritising for business and market value,
● Delivering smaller and more regular product features to the marketplace,
● Increased business collaboration and transparency throughout the organisation, and
● Reducing risk through faster learning from the marketplace.
Retail agility is the recipe for delivering smaller product features far more frequently to the marketplace and your customers and monitoring their response. This means you can make smarter retail decisions and improve collaboration, all while reducing risk and cost in the long-term.
So what are the ingredients to retail agility? A good way to think of it is to picture retail agility as being four doors on your path. Passing through all four doors helps put your business on the road to retail agility.
Let’s start with embedding a culture of adaptability across your organisation from top to bottom. This means having management lead by example and having the right governance structures in place so it becomes second nature. The culture involves creating a feedback loop, where you’re looking for ways to build on other people’s ideas and projects and identifying the return and value of investment, before moving onto development. This helps channel thinking into the 20 per cent of work that delivers the 80 per cent of value to your business.
For all retailers, the technology underpinning your business is crucial to retail agility. Technology is a substantial investment that needs careful consideration for how it fits your business. It’s worth factoring in the following:
– Expense: Is it a sunk cost or do you pay as you go?
– Scalability: Does your technology allow for seasonal or dynamic scaling? Will it scale as your retail business grows? Or will you need to invest more as you expand?
– Restrictions: Does your technology solution restrict your business? Is the technology solution working with or against you?
– Evolution: If your retail business evolves, does that mean you need to change your entire technology stack?
– Being the leader: Does the technology help you get to market first?
– Transparency: Are there any hidden technology costs? Do you get support and upgrades?
It’s not strictly about finding a partner who has the right technology solutions for your business. A partner can amplify your retail agility, becoming an extension of your retail business, able to be actively involved with your team and helping you drive effective change. A partner can help you implement the technology needed to scale your retail business. In addition, they can add value and expand your growth potential, helping with developing products and services to keep your business at the forefront of retail innovation.
When we boil down retail agility, it comes down to four central questions:
1. Can we achieve the right cultural mindset?
2. Are we willing to accept that retail agility is a journey with milestones?
3. Do we have the power to implement the best technology?
4. Do our partners help us grow, provide expertise and foster our ability to become more agile?
Disruption in retail is now to be expected. There are countless examples of entrenched retail leaders being overtaken by newer, more agile businesses. Retail agility is the concept of being able to adapt to a changing retail landscape quickly and sensibly. It involves working on the four doors, and trying something new. That willingness to change quickly, roll out new products and services and scale means you can start the journey to beating your competitors, but also warding off the innovators as well.
Agnes Schliebitz-Ponthus is the Director of Product at Bulletproof.