The first month of 2014 has come and gone. January is typically known as a slow month in the retail world with retailers reeling from inventory shortages due to the holiday season or pondering what they can do to increase store or website traffic. For retailers without a technology solution, the answers to their January blues may be an investment in a powerful retail technology solution.
As a buyer, my colleagues and I were always challenged to be creative in January and February. One key executive always pointed out to us that merchandisers are notorious for blaming slow retail sales on cold weather or frugal consumer spending habits. Sure, there is some truth to this. However, often retailers decelerate efforts in the early months of the year, resting on their laurels and not making a concerted effort to make their customers WANT to shop at their stores.
Inventory is a huge concern after the holiday season. Retailers are often struggling to get back in stock after poor assortment allocation and planning prior to the major shopping season. Conversely, slow holiday sales may have merchandisers dumping valuable margin dollars out the window by marking down old stock. Macy’s seems to understand the inventory battles. They are paying attention to their customers and ensuring that they have the right merchandise for customers at the right time. They are even going as far as using bricks-and-mortar locations as mini fulfillment centers to ship merchandise that’s not selling at one location to another, which has customers demanding that merchandise. They have invested significantly in researching their customers’ shopping habits and they have used technology to execute this investment effectively.
Price intelligence is another way retailers can use technology to ensure they are priced-right in order to capitalize on consumer spending. Retailers are using retail price intelligence to ensure they are priced competitively in certain markets. They are also employing price intelligence to define their customers’ willingness to spend in certain categories. For example, assortment analysis may prove that the retailer is not assorting a product that is widely available and hugely popular, thus leaving their shoppers disappointed and seeking elsewhere to shop. They may also discover that many of their competitors are assorting the same product at a much lower price. Translation? Retailers realize they can’t compete within a specific product category and therefore, fail to provide value to their customers by carrying products that their shoppers are interested in.
Retail technology empowers merchandisers to effectively understand their business. This translates into better planning, increased conversion and an overall much happier customer. Now that it’s February, it’s time for retailers to fight for the almighty dollar! Some will continue using traditional artillery; the winners like Macy’s will invest further in technological resources to get the job done.