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October 8, 2015

Delivering differentiated customer experience in Omni-channel apparel retail

Conventionally, apparel retailers have segregated their customers into those who shop in-store and those who shop online. However, these differences are blurring as the tech-savvy and personalized experience seeking customer expects a holistic retailing landscape. The shift from traditional apparel retailing approach of 'Brick against Byte' to 'Brick in favour of Byte' has to be rapid and disruptive, rather than gradual and conservative. Thus, the heart of Omni channel retailing lies in the holy matrimony of customer's expectation and retailer's capabilities. 

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January 2, 2015

Bridging the Physical and Digital Worlds

I am a technophile, and I believe sincerely that technology is going to make tomorrow's world better than the one today, just like it made today's world better than yesterday's. The retail shopper will be among those who enjoys increased conveniences and better shopping experiences with the technology trends sweeping the Retail industry today.


One such trend - a vital piece of the Omnichannel puzzle - is interconnecting the physical and digital customer touch-points, thanks to various technologies including geo-fencing, NFC tags, GPS and mobile devices like smartphones. By bridging the physical and digital worlds and allowing them to interact with each other in a seamless manner, the Retailer can improve the customer's shopping and service experience resulting in increased conversions.


Let's take an example from a real life situation. Say I want to buy a smartphone and I research various smartphone brands online, select one and add it to my shopping cart or wish list. The next time I walk into a store, an alert can be made to appear on my smartphone asking if I need assistance buying the smartphone in my abandoned shopping cart or my wish list. The customer experience could then be taken further, by paging a customer service rep to come help me or by allowing me to navigate to the electronics section using my phone. The experience could be completed with price comparisons, a mobile checkout and feedback on the product and experience.


This is just one example and the possibilities are endless - including personalized in-store offers, price and availability alerts, proximity based product information, showrooming and analytics of in-store behavior; not to mention upcoming technologies such as Automated Shopping Trolleys, 3D Printing and Augmented Reality. And while Retailers improve their experience, Shopping Mall operators are also starting to connect shoppers to the digital world, for added conveniences such as automated parking garages and price comparisons.


Shoppers may look forward to an exciting future where their shopping trips resemble a sequence from a science fiction movie. Retailers already have several tools to launch themselves on the way to that future.


To learn more about the various ways for Retailers to bridge the physical and digital worlds, meet our experts at Retail's Big Show. Schedule a meeting now. Visit www.infy.com/NRF15.

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December 22, 2014

Smartphones and Smart Consumers

 

There was a time when if you went to a retail store and the prices seemed a bit high, you would have to drive to a competitor to compare rates.  If it turns out the initial store was cheaper, you could drive on back and make your purchase.  Then the internet came along.  If you wanted to compare prices, you could do some online research comparing different retailers' prices, before printing off your MapQuest directions to the store offering the lowest prices.  Now, we're in the mobile era.  From a retail store you can quickly look up the price of a consumer product offered at every single competitor from your tiny computer that you take everywhere that happens to make a phone call once in a while. 

How do retailers satisfy these knowledgeable consumers?

                Armed with smartphones, consumers demand lower prices and have the power to seek out less expensive alternatives, including buying from online retailers like Amazon.  To compete, many retailers have offered to match the lowest prices from physical and online retail stores alike.  This can prevent a retail store from losing the customer, but a cost.  Retail stores lose revenue by lowering their prices to match low-cost competitors, but they also must deal with the uncertainty in forecasting associated with selling a product at various prices.  Price matching also allows some shrewd bargain hunters room to pull a fast one over retailers.  Recently some customers created false Amazon pages to purchase Playstation 4 consoles at less than 25% of the going rate.

Where does this leave retailers?

                Retailers use this price-matching to practice price discrimination.  They offer lower prices to the bargain-hunters who pull up competitor prices on their iPhones, but offer standard rates to those who are satisfied with the listed price.  This strategy allows retailers to stave off the low prices of online retailers a little bit longer, while also extracting the most revenue from most customers.  Trends are moving in the direction towards consumers gaining more and more information about consumer products value and quality, so physical retail stores must begin to offer more benefits to the in-store experience if they wish to remain profitable.  The Apple Store is the pinnacle of this in-store experience.  Customers enjoy trying out the latest products, receiving one on one assistance from "Geniuses", and lounging around in the sleek-looking stores.  There is still a reason to go to these physical locations.  Price-matching is nice short-term band aid, but retail stores must continue to offer premium experiences if they expect today's consumers to choose in-store purchases over the convenience and experience of online shopping.

April 30, 2014

Empowering the Store Associate

Today's hyper connected digital consumers are modeling their own shopping experience. They are discerning, demanding and have more access to information than ever before. Enabled with mobile and ubiquitous connectivity, they can compare products, access price and product information, check availability, get reviews from friends, whether online or inside the store.  While retailers continue to engage consumers across channels, it has become imperative for retailers to invigorate the in-store experience to meet today's consumer demands and leverage their front line--store associate to effectively impact sales.

 

Enabling store associates to become brand advocates can go a long way in personalizing consumer engagement in stores and differentiating on service. But the reality is that consumers have access to more information than store associates, adversely impacting their ability to be effective. Also, Omni channel initiatives like ship from store, buy online pick in stores requires retailers to use store employees for a range of new tasks such as picking, packing, while ensuring they continue to deliver superior consumer services.

 

To address these challenges, retailers can adopt a 3 pronged strategy to unleash the potential of store associates

 

  • Begin with institutionalizing in-store business processes, to assure consistent experience across product categories, departments and associates with varying skill sets. Secondly, store associates need be given access to critical information like 360 degree Omni channel consumer profile (including preferences, purchase and browse history, wish list, social media interactions etc.,), rich product data (including ratings, reviews, comparison charts etc.,) , new trends, enterprise wide product availability to be able to add value to consumer's buying process. This will not only enable a more meaningful dialog but also enable associates to provide personalized suggestions / recommendations based on consumer preferences, likes/ dislikes, purchase & browsing history  and drive upsell cross sell based on what is being purchased today. Also, retailers can come up with a comprehensive communication strategy ensuring that the in store interaction with associate continues post visit through emails on new product launches or invitation to store events. 


  • Build a scalable, flexible, integrated consumer engagement platform to house business processes, powered by a common data model and services to render sales and service information to any device / form factor. Equipped with mobile or tablet device, store associate should be able to tap into this platform and engage with consumers helping them select products, provide custom promotions, instantly order leveraging global inventory while allowing the consumer to pay and checkout in the aisle. Store mobility initiatives which enable back office supply chain functions such as receiving shipments can positively impact their operational effectiveness.


  • Last but not the least, adequate provision should be made to train store manager and associates on the best practices, business process , workflows and tools to  increase adoption and deliver higher value to consumers . Whether it is process of inviting consumers for store events, balancing in-store customer service with fulfilling orders or aligning store processes to meet pick up SLA's for online order fulfilled from store, providing training assistance goes a long way in improving sales efficiency and effectiveness.


Investing in empowering store associate to provide truly personalized service can yield higher conversions, improve store traffic and increase average order value while bolstering brand loyalty. I'd love to hear your experiences, challenges faced, impact on business and IT while deploying solutions to enable store associates




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October 22, 2012

Are you Game?

I was intrigued when my son walked up to me with a request to order a pizza he had made on ipad game app from Dominos. The fun and excitement of playing the game coupled with pride of self-accomplishment was inescapable in his eyes...we did order the pizza and it was clear that Dominos now had a new Gen Y consumer.

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September 30, 2012

Leveraging Social / Consumer Genome for Merchandising

Most retailers traditionally leverage sales data from POS terminals to analyze buying behavior. In some cases, loyalty card data is also used to determine appropriate assortment decisions. These data sources and their corresponding analysis have proven reasonably helpful, though they don't convey the whole picture. With the recent explosion in social and consumer related data on the web, there is a wealth of information that Retailers should be exploiting and incorporating into their merchandising decisions, primarily around assortment and space.

Social/Consumer genome related data provides rich insights into needs, wants and buying behavior of individuals. This data when combined with demographic and geographic data can provide a good map of consumer wants and needs for a given market for a set of product categories.

A major input into merchandising decisions / assortment plans is to determine consumer buying behavior to identify what products sell and what potential products could sell to increase sales. Based on this analysis, assortment decisions of inclusion/exclusion or allotment of space are provided. The means to identify this buying behavior was typically the use of POS data or data from Nielsen/IRI that provided good basis for WHAT was being purchased. When married with Demographic data, there was a good proxy for WHY the products were being purchased. Even when rigorous correlation and clustering analysis is carried out, the determination of buying behavior and the reasons for the same were proxies at best.

Now with the availability of consumer genome or social genome information, the analysis of WHY purchases are being made and what is being purchased with identification of latent and express needs becomes even more accurate as there is clear expression of wants and needs. This will significantly enhance the quality of assortment and merchandising decisions as the degree of error/approximation is reduced.

There are however some pitfalls to the use of this data. We cannot solely rely on this data as web usage and consumer/social genome information may not fully represent buying needs and wants for the entire market population. This data usage has to be married to traditional sales analysis to augment the decision making process.

There are no tools / application products in the market place that provide truly integrated capabilities. The holy grail for optimized merchandising would be to integrate social/consumer genome data effectively into the traditional clustering analysis and thereby into the assortment planning process. This might be a challenge for some of the retailers who struggle with traditional approaches. Asking them to adopt more advanced analytical approaches to incorporate social/consumer genome data would be a challenge.

The key would be to devise suitable technology/process platform augmented with robust analytics shared services that can leverage necessary data to enable optimized merchandising decisions.

This article has been contributed by Amitabh Mudaliar (Group Engagement Manager - RCL Infosys). You can reach Amitabh at Amitabh_M@infosys.com.

Cashing in on "Order to Cash" through BPO shared services

 The Order to Cash process is at the heart of every business and I have often been tasked with asking clients and prospects to consider moving their Order to Cash processes into a Shared services delivery model with a third party service provider.  Over the years this attempt of mine has evinced myriad expressions from clients ranging from the "Have you lost it?" look to the "You just showed me business process nirvana" look. The industry where I experienced the most contrasting reactions was the CPG industry and I wanted to share some interesting learning from the experience of working with a few clients in walking the talk and sharing in their Order to Cash transformation journey over the years.

To provide some context, the concept of Business process outsourcing in the CPG industry is not a new one. This industry was one of the earliest adopters of outsourcing transactional and back office business processes such as Accounts Payables, Accounts Receivables, Payroll processing and Procurement. The primary driver for outsourcing across all these processes was labor cost arbitrage followed by process efficiencies from consolidation; harmonization and continuous improvement. These drivers have become the cornerstone of all business process outsourcing relationships and have for long settled into becoming the marketing tagline for the BPO industry.

With this legacy of perceived value from BPO relationships, when one has to go down the same journey with Order to Cash processes, the value equation does not necessary stack up. The most obvious reason for this skew in the case of O2C processes is Risk. To cite an instance provided by one of my clients - The entire annual cost savings delivered by a BPO relationship can potentially be eroded by one order from a large retailer being inadvertently dropped or shipped to the wrong address due to the contractual penalties involved. And one defect out of a million is acceptable even by "Six Sigma" standards!

So two questions come up, the "Why" and the "How"? The "Why" is easy. Given that the Order to Cash process impacts not just the G&A metric but also the Cost of Goods Sold, Working capital efficiency, Days Sales of Inventory and Gross Revenue metrics, a successful shared services strategy undertaken by engaging the right partner could catalyze business transformation impacting the highest levels of the organization.

The tough question however is the "How"? I often relate that to converting an "Art" into a "Science". The "Art" here refers to the finesse and proficiency that Customer service representatives have honed on their jobs for a number of years. The "Science" here refers to replicating that same level of service or sometimes even improving it but with a completely new team that's located thousands of miles away in a global delivery model.  Sounds like mission impossible right? Not really. It's been done before and involves the following best practices:

·         Create the right operating model: The tried and tested Front Office-Back Office model is a great starting point. It allows for a risk mitigated approach to the end state sourcing mix given the need to balance risk and value in a customer centric setup for the CPG industry.

·         Create the right performance measurement methodology: The days of adopting operational metrics such as cycle time, average handling time, Abandonment rate, First Contact Resolution etc to govern outsourcing relationships are a thing of the past. These metrics are now considered Business As Usual (BAU). Consider including business metrics and supply chain performance metrics such as cost per order/invoice, Case Fill Rates (CFRs), On Time Delivery (OTD), Truckload capacity utilization, Days Sales Outstanding (DSO) into the performance measurement framework

·         Create a segmented service framework: Most CPG businesses operate in the 80:20 model where 20% of customers account for 80% of revenues. Given this mix, a one size fits all shared services model will fail to deliver differentiated service experience to top tier customers. Consider a three tier service framework involving Transactional shared services, Business support services and Enterprise support services layers

·         Choose the right global delivery model: Most top tier BPO providers today have global presence with established Centers of Excellence. Adopt a hub and spoke global delivery model preferably aligned to customer tiers as well as the segmented service framework

·         Adopt a phased transition approach: A prudent transition plan is the foundation to successful Order to Cash shared services adoption. Consider creating a phased transition plan where phasing is based on customer tiers, markets, process complexity or a combination of these parameters

While there are several other design considerations, the above five are what I could call the essential ingredients of Order to Cash BPO solutions for the CPG industry. With these best practices implemented, companies can start to cash in on their Order to Cash processes through BPO shared services led transformation.

This article has been authored by Sushanth Ananth (Manager, Client Services - Retail, CPG, Logistics and Life Sciences, Infosys Ltd). You can reach Sushanth at Sushanth_ananth@infosys.com.

 

 

 

July 31, 2012

Paradigm Shift in Loyalty Card Programmes: Win-win for Retailers, CPG Brands and Customers

Guest Post by

Srinivasan Nithyanandam, Manager, Client Services for Retail,  CPG and Logistics - Europe , Infosys

 

Battling slow economic growth and high costs in a difficult market, retailers are competing aggressively to increase their customer's wallet share and mindshare. The new breed of digital consumers, who want convenience, personalization, and promotion-based pricing, has made winning in this environment even more challenging. Operating within the tight confines of single-digit-percentage operating margins, retailers must continuously innovate to increase consumer foot falls and clicks. In such an environment, personalised offers, rewards, targeted communications and promotions can help heighten customer interest and encourage repeat shopping.

Continue reading "Paradigm Shift in Loyalty Card Programmes: Win-win for Retailers, CPG Brands and Customers" »

December 18, 2009

Enhance Customer Loyalty at the Final moment of truth

In this age of discerning and value chasing shoppers, Customer Loyalties can change in a single moment and gaining or retaining loyalty is a marketing warfare. Store is the final frontier where products are given equal opportunities to see, evaluate and choose the brand. Brands can be made or broken in these last few minutes of life span a shopper will give to your brand. It is then highly imperative for the brands to make best use of these last few minutes and ensure that the customers stay loyal. Here are 3 basic strategies, Retailers and CPG companies can look at to enhance customer loyalty.

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