Retail 2
024 offers retailers a chance to breathe. While the inflation crisis of 2022-23 is not yet over, its effects are waning. Retailers looking to build a shield to protect
against future financial crises must take this opportunity to look forensically at their business processes to find efficiency and alignment which was not there before. They must seek ways to build resilience and agility, while developing the tools to exploit opportunities quickly in a market liable to change at a moment’s notice. Understanding and embracing retail digital transformation
is the key. How ever set in their ways a retailer might be, now is the time to commit to transforming the central functions of their business structure to support a new way of working with data at its core. Digital transformation is not a drop-in solution, but it is critical: siloed, fragmented businesses are highly unlikely to find the pace to keep up with the modern structures of those that have streamlined and unified their processes.
Applying digital transformation where it matters Many people relate the notion of digital transformation to grandstand moves: a flashy new website, a headline-grabbing interactive dressing room or virtual rail, or perhaps digitised packing. Tese are, certainly, elements which could form part of a digital transformation effort – but the true worth of digital transformation is in supplying the detail that makes such actions possible. Rethinking, realigning, and redesigning the core functions of a business may be less glamorous than a new website, but improving data availability is the kind of action which enables a retailer to operate in the way it should. Of course, many feel that if business processes work, there
is no need to change. Look deeper, though: many departments are so mired in admin that they cannot perform their jobs properly. Businesses do not need to stick with inefficient workflows. Embarking on a digital transformation mission works to align every function of a business into a cohesive whole. In turn, it opens up opportunities to merge AI into retail, introduce algorithmic retailing, develop leaner systems and, ultimately, free up the time of key staff to focus on the things that really matter.
The importance of a single plan Te digital transformation of retail is creating more intelligent merchandising practices, to drive competitive advantage through improved end-to-end planning and execution. Done right, it means every department has access to the same data and works towards the same core goal from a single plan. Every employee is pointed in the same direction. And a unified data source means there is one single source of truth for a business. Tis can vastly reduce the amount of duplication required to
keep core functions running. Within a digitally united business, the paperwork surrounding inter-department communication is virtually eliminated – one hand always knows what the other is doing. If a core plan changes in response to a change in the market, a digitally transformed business can respond from top to bottom, communicating clearly and providing every function with the information they require in an instant.
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Better business information through central data Business information is vital, but for many businesses it can be a source of frustration. Currently, finding statistics or intelligence might be a case of contacting a central BI unit, waiting for a response, and being handed historical data which may or may not be useful. If businesses are to be agile in their decision making, they need information at their fingertips, without lag and without a clumsy process standing between people and numbers. Digital transformation offers more than just easy access to
data, however. Much of the minutiae of running repeatable functions could be handed off to AI, for example, allowing algorithms working with a central data set to discover and refine insights which teams of humans would take weeks to find – or perhaps never find at all. Digital transformation also offers the opportunity to create more dynamic reports, and incorporate predictive data built through intelligent models which consider not only past performance but the market as a whole.
Revealing powerful promotional opportunities The power of promotion, as retailers know, is a vital driver towards increased sales and customer engagement. But the most powerful promotions, those that create a buzz beyond price, are built around a critical workflow path which puts visibility first. Every part of the puzzle must know its part in promotion planning, from suppliers to design agencies, from those planning the shelves to those establishing prices. Media and marketing departments can no longer operate
separately from buyers, logistics and store operations teams. Digital transformation presents an opportunity for the kind of unity that will revolutionise end-to-end merchandising and allows marketers to work safely without falling foul of price establishment rules or geographical variations. Central data allows a clear chain of operations to be established; with this in place, marketers can manage promotions with impact, increase the value of supplier collaboration, and discover ways to generate bespoke intelligent merchandising offers.
A new horizon for employees Digital transformation unites disparate functions and enables a consistent, centralised and coherent approach to keeping customers happy and satisfying every one of a retailer’s needs. Make no mistake, realigning one’s company to take advantage of a digital transformation effort will not be an easy process. It will mean process overhauls, significant change, and lead to many key employees relearning the way they work. But those same employees will, through ring-fenced AI
initiatives, be freed from much of the day-to-day grind which today prevents them from reaching their full potential. Tey will be empowered, part of the engine of the whole business, rather than a cog in a closed-off department. And that business, backed by accessible data empowered by AI and algorithmic tools, will have a far stronger picture of the way it should be working – and gain a vital edge over its competitors.
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