Tag: consumer behavior

6 Disruptive Forces that are Creating New Challenges and Opportunities for Retailers (Part 2)

Posted on by Omprasad Devadiga

Welcome back to Part 2 of “6 Disruptive Forces that are Creating New Challenges and Opportunities for Retailers.” In Part 1, we explored the 3 disruptives and how they are shaping the future of retail. Now, let’s delve into the remaining three.

4. Escalating Prioritization of Sustainability

Sustainability has become a top priority for consumers, businesses, and policymakers. Retailers are facing increasing pressure to adopt sustainable practices and demonstrate their commitment to environmental and social responsibility. Key trends include:

  • Supply chain transparency: Consumers demand transparency into the supply chains of the products they purchase, ensuring ethical and sustainable sourcing.
  • Decarbonization: Retailers are under pressure to reduce their carbon footprint and transition to renewable energy sources.
  • Human rights & DEI: Ensuring human rights and promoting diversity, equity, and inclusion (DEI) are becoming essential for retailers.
  • Plastic packaging: Reducing plastic waste and promoting sustainable packaging solutions is a growing concern.
  • Circularity: Retailers are exploring circular economy models to minimize waste and extend product lifecycles.
  • Food waste: Reducing food waste throughout the supply chain is a key sustainability challenge.
  • Consumer health: Consumers are increasingly concerned about the health and safety of products, leading to stricter regulations and labeling requirements.
  • Biodiversity: Protecting biodiversity and minimizing the environmental impact of retail operations is essential.
  • Resource intensity: Retailers are under pressure to reduce their consumption of natural resources.

70% of consumers feel companies should drive positive ESG outcomes

Imperatives for Retailers

To address these sustainability challenges, retailers must:

  • Build end-to-end supply chain transparency to ensure ethical and sustainable sourcing.
  • Develop circular processes to minimize waste and extend product lifecycles.
  • Create alliances with peers to share best practices and collaborate on sustainability initiatives.
  • Prioritize material issues, such as plastic reduction and sustainable packaging.
  • Measure and report their environmental and social impact to demonstrate accountability.
  • Educate consumers on how to use and dispose of products sustainably.
  • Optimize stakeholder communications to build trust and transparency.
  • Operationalize their ESG strategy to integrate sustainability into all aspects of their business.
  • Explore alternative suppliers that prioritize sustainability and ethical practices.

5. Rising Political & Economic Uncertainty

The global political and economic landscape is increasingly volatile, creating uncertainty for retailers. Key trends include:

  • Geopolitical conflict: Geopolitical tensions and conflicts can disrupt supply chains and increase costs.
  • Rising trade tensions: Trade wars and tariffs can impact the cost of goods and create uncertainty for businesses.
  • Uneven vaccinations: The global distribution of vaccines and the emergence of new variants can impact economic recovery and consumer confidence.
  • Inflation and energy costs: Rising inflation and energy costs can increase operating costs for retailers.
  • Debt and interest rates: High debt levels and rising interest rates can create financial challenges for businesses.
  • Supply chain disruption: Disruptions in supply chains due to geopolitical events, natural disasters, or other factors can impact product availability and costs.
  • Unemployment: Rising unemployment can reduce consumer spending and create economic uncertainty.
  • Cybersecurity breaches: The risk of cybersecurity breaches is increasing, posing a threat to businesses and consumers.
  • Political polarization: Political polarization can create a challenging environment for businesses and make it difficult to navigate regulatory changes.

60% of consumers are worried that war will spread globally

Imperatives for Retailers

To mitigate these risks, retailers must:

  • Build local supplier networks to reduce reliance on global supply chains and mitigate the impact of geopolitical events.
  • Hedge for cost spikes by implementing strategies to manage price fluctuations and protect profit margins.
  • Diversify global logistics to reduce the risk of disruptions and ensure a reliable supply of products.
  • Assess geopolitical scenarios to anticipate potential risks and develop contingency plans.
  • Impose price guarantees to maintain customer loyalty and mitigate the impact of rising costs.
  • Simplify in-store assortments to focus on essential products and reduce inventory costs.
  • Reduce fossil energy reliance to mitigate the impact of rising energy costs and support sustainability goals.
  • Tighten data encryption to protect sensitive customer data and mitigate the risk of cybersecurity breaches.
  • Restructure debt burden to improve financial stability and reduce the impact of rising interest rates.

6. Blurring Lines Between Sectors and Channels

The boundaries between sectors and channels are blurring, creating new opportunities for retailers to expand their offerings and reach new customers. Key trends include:

  • Consumers as products: Retailers are increasingly leveraging customer data to provide personalized experiences and sell targeted products and services.
  • From product to service: Retailers are transitioning from selling products to providing services, such as subscription models and personalized recommendations.
  • Retailtainment: Retailers are combining retail with entertainment to create immersive and engaging experiences.
  • Immersive experiences: Retailers are leveraging technologies like augmented reality (AR) and virtual reality (VR) to create immersive shopping experiences.
  • End-to-end engagement: Retailers are striving to provide a seamless customer experience across all channels, from online to in-store.
  • Bundled solutions: Retailers are offering bundled solutions that combine products and services to meet the needs of customers.
  • Self-healthcare: Retailers are expanding into self-healthcare products and services, such as wellness products and virtual consultations.
  • Gamification: Retailers are incorporating gamification elements into their shopping experiences to engage customers and drive sales.
  • Selling data: Retailers are exploring new opportunities to monetize customer data, such as targeted advertising and market research.

44% of consumers intend to spend more on experiences

Imperatives for Retailers

To capitalize on these trends, retailers must:

  • Expand the scope of their ecosystem to include a wider range of products and services.
  • Increase the range of services they offer to meet the evolving needs of customers.
  • Group products with services to create bundled solutions and increase customer value.
  • Explore sector adjacencies to identify new growth opportunities.
  • Leverage alternative models such as subscription services and rental options.
  • Identify B2B value pools to expand their customer base and revenue streams.
  • Build a retail media presence to reach new customers and monetize their audience.
  • Develop digital-first offerings to meet the needs of digital-savvy consumers.
  • Create in-store experiences that are engaging and memorable.

The retail industry is facing a complex and challenging landscape, shaped by evolving consumer behaviors, rapidly changing technologies, increasing tax & regulatory complexity, escalating sustainability priorities, rising political & economic uncertainty, and blurring lines between sectors and channels. Retailers that can successfully navigate these disruptive forces will be well-positioned for long-term success. By understanding these trends and implementing appropriate strategies, retailers can adapt to the changing landscape and thrive in the future.

Decoding Global Consumer Behavior: What Retailers Need to Know?

Posted on by Omprasad Devadiga

In today’s fast-paced, digitally driven world, consumer expectations are higher than ever. Retailers must adapt to meet these evolving demands and deliver exceptional experiences that drive customer loyalty and satisfaction. One key area where retailers need to excel is performance.

Understanding High-Performing Retailers

High-performing retailers are those that consistently exceed customer expectations in terms of product quality, service, convenience, and overall shopping experience. They are able to:

  • Deliver exceptional product quality: High-performing retailers prioritize sourcing high-quality products and ensuring they meet or exceed customer standards.
  • Provide outstanding customer service: From knowledgeable staff to efficient returns policies, high-performing retailers go above and beyond to meet customer needs.
  • Offer convenient shopping experiences: This includes factors like easy navigation, fast checkout processes, and multiple channels for shopping (e.g., online, in-store, mobile).
  • Create a positive brand experience: High-performing retailers build strong brand identities that resonate with their target audience and foster loyalty.

What Do Global Consumers Want?

Global consumers have a set of shared expectations when it comes to retail performance. These include:

  • Product Quality: Consumers expect products to be well-made, durable, and meet their needs. They are increasingly willing to pay a premium for high-quality items.
  • Convenience: Consumers value convenience and efficiency. They expect retailers to offer easy ways to shop, whether online or in-store.
  • Personalization: Consumers want retailers to understand their preferences and tailor their experiences accordingly. This includes personalized recommendations, targeted promotions, and relevant content.
  • Omnichannel Experiences: Consumers expect a seamless shopping experience across all channels, whether they are shopping online, in-store, or using a mobile app.

How Can Retailers Meet High Expectations?

To meet the demands of today’s global consumers, retailers must focus on the following areas:

  • Invest in Product Quality: Retailers should prioritize sourcing high-quality products and conducting rigorous quality control.
  • Prioritize Customer Service: Retailers should train their staff to provide excellent customer service and create a positive shopping experience.
  • Embrace Technology: Retailers should leverage technology to improve efficiency, personalization, and convenience. This includes investing in e-commerce platforms, mobile apps, and customer relationship management systems.
  • Create a seamless omnichannel experience: By integrating online and offline channels, providing consistent product availability, and enabling personalized interactions across all touchpoints.

How Can ETP Unify Help Retailers?

ETP Unify offers a comprehensive suite of solutions that can help retailers meet the evolving needs of global consumers. ETP Unify is a powerful cloud-native Unified Commerce Retail Solution. Built using MACH Architecture, it brings the best of Retail and e-commerce functionality to the user in one, easy-to-use, beautiful interface. With all information stored in one database, it empowers retail merchants and managers to have all the information and tools at their fingertips to serve customers across channels, helping create an amazing experience for consumers. By leveraging ETP Unify’s capabilities, retailers can:

Enhance Product Quality

  • Logistics Management System
  • Efficient Delivery: Streamlined logistics processes ensure products are delivered on time and in good condition. This reduces the risk of damage during transit and improves customer satisfaction.
  • Accurate Tracking: Real-time tracking of orders allows retailers to monitor the status of shipments and proactively address any issues that may arise, such as delays or lost packages.
  • Reduced Costs: Optimized logistics operations can help retailers reduce shipping costs and improve overall profitability.

Product Information Management

  • Consistent Information: A well-managed ETP Unify’s PIM system ensures that product information is accurate and consistent across all sales channels. This helps to avoid confusion and errors that can lead to customer dissatisfaction.
  • Enhanced Product Search: Accurate and comprehensive product information makes it easier for customers to find the products they are looking for, improving the overall shopping experience.
  • Improved Marketing: A PIM system can help retailers create targeted marketing campaigns based on product attributes and customer preferences, increasing the effectiveness of their marketing efforts.

Improve Customer Service

AI-Powered Recommendations

  • Personalized Experience: By suggesting products tailored to individual customer preferences, AI-powered recommendations create a more personalized and engaging shopping experience.
  • Increased Sales: Recommendations can upsell and cross-sell products, leading to increased sales and revenue.
  • Improved Customer Satisfaction: When customers receive relevant product suggestions, they are more likely to find what they need and feel satisfied with their purchase.

Smart Order Management System

  • Efficient Returns: A well-functioning order management system simplifies the returns process for both customers and retailers. Customers can easily initiate returns, and retailers can efficiently process them, improving customer satisfaction.
  • Reduced Errors: Automation in order management can help minimize human errors, such as incorrect shipments or processing mistakes, leading to fewer customer complaints.
  • Improved Inventory Management: An efficient system can help retailers better manage their inventory, reducing the likelihood of stockouts or overstocking, which can impact customer satisfaction.

Optimize Operations

Unified Inventory Management System:

  • Real-time Visibility: The system provides real-time visibility into inventory levels across all channels, ensuring that retailers always have an accurate understanding of their stock.
  • Reduced Stockouts: By preventing stockouts, retailers can avoid lost sales and customer dissatisfaction.
  • Minimized Overstocking: Optimized inventory management helps to prevent overstocking, which can tie up capital and increase storage costs.

Create Omni-channel Experience

  • Product Availability: ETP Unified inventory management solutions can help retailers maintain accurate inventory levels, ensuring that products are available for purchase both online and in-store.
  • Channel Integration: ETP Unify can help retailers integrate their online and offline channels, ensuring a consistent customer experience across all touchpoints.

In today’s competitive retail landscape, high performance is no longer a luxury but a necessity. Retailers that can meet and exceed the expectations of global consumers will thrive. By investing in product quality, and customer service, and optimizing their operations, retailers can create a lasting impression and drive long-term success.