At ETP, as we work with retailers across 20 countries and over 25,000 stores and 500 brands, we have seen tremendous depth in their skills in merchandising, brand management, sales and supply chain management, their understanding of their diverse customers and employees, their ability to manage cycles and seasons and still produce a profit, their infrastructure management, their cash management, so on and so forth.
In the last one year, we have seen these giants waking up to their potential in the eCommerce space. With all their powerful management and execution capability, they could be the game-changers of this new “omni-channel” retail world. Like all large organisations with a legacy and systems and processes in place, they may not be as nimble as the pure-play eCommerce players, however they seem to have got it now and are ramping up their organisations’ technology, culture and capability to play the eCommerce game. At the same time, the eCommerce players have grown and are struggling with the lack of the same competencies that the larger retailers have.
It is a fascinating new battle front and the next couple of years will tell all. My guess is that the winners will be the ones who leverage the core competencies of retail and deploy the technological savviness of eCommerce.
This article has been written by:
Naresh Ahuja, Chairman and CEO, ETP Group
Naresh as the Founder, Chairman and CEO of the ETP Group leads the company with a clear focus on bringing enduring value to customers through best practices mirrored in software applications. Spanning 25 years of focus on retail domain expertise and IP development, ETP today, has a strong customer base of market leaders in more than 20 countries across Asia Pacific, India and the Middle East, and is on its way to becoming a global leader in Retail Software Solutions.
In 2014, 50,000 retail associates used ETP Retail Software Solutions to serve 180,000,000 consumers, selling USD 15,000,000,000 of merchandise. Over 300 global brands in 20 countries, across 10 time-zones, in 200+ cities, at 25,000+ stores, in 5 languages, run on ETP. More than 500 enterprise software projects were successfully implemented for leading retailers throughout Asia Pacific.
Founded in 1988, ETP Group is a leading retail software solutions company headquartered in Singapore with a presence in 20 countries across Asia Pacific and the Middle East. ETP’s value proposition is its ability to create innovative retail software solutions, to deliver domain expertise through its best practices knowledge base and expert team of consultants adding up to 1800 man years of retail expertise in various retail verticals: Apparel, Fashion Footwear, Sports Goods, Luggage and Hand Bags, Time Pieces, Luxury Goods, Mobile Phones and Accessories, Electronics and Multimedia Communications, Furniture and Home Furnishings, Jewelry and more.
ETP’s Retail Software Solution – ETP V5 is an enterprise class, scalable and secure platform for large to mid-sized retailers. ETP V5 includes forward looking innovations in omni channel store solutions, marketing campaigns and CRM, supply chain management and warehousing, merchandise planning, assortment planning and OTB with powerful analytics solutions. With a simple and user-friendly interface and a range of mobile, social media and web apps, it is tuned to the new generation of retail employees.
ETP’s 25 years in the retail space has resulted in ETP building a powerful and solid domain expertise, demonstrable through its renowned best practices templates, which are used during the implementation of the ETP V5 solution. Companies looking for advanced technology to improve their business efficiencies and a long term, stable partner find value in ETP.
“The secret of change is to focus all of your energy, not on fighting the old, but on building the new.” – Socrates
Retail is changing, as an industry, as a business and even as a concept. The rapidly evolving dynamics of demographics, emerging markets and raw materials, disruptive technologies, changing lifestyles and consumer expectations are some of the key elements to bring about this change. As the renowned scholar is quoted above, these conditions cease to be a challenge if retailers actively participate in building new self-sustaining retail ecosystems that explore opportunities to convert people not sales.
“Leading retailers will be those that are the best conversationalists and are good at listening to their shoppers’ needs, along with communicating a secure and self-confident image to their consumers. They will need to re-act quickly, be where the shopper is and offer relevant messaging all in the timeframe that is important to the customer.” says Al Meyers, Director of Retail and Consumer Practice, PwC.
Citing a Jones Lang LaSalle Report – Real developments will come through new ideas and a more sophisticated execution of those ideas. Consumers want emotion and they want realness; a poor imitation will fall flatter than a bad joke. They want local and global, they want ethical, they want smooth seamlessness, they want great design. They want more authenticity and they want more lively change.
Naresh Ahuja, Chairman & CEO, ETP Group , represented similar views at the 5th Annual Retail Congress Asia Pacific 2015. During the panel session, he elaborated on how customer experience and satisfaction, in the final mile of fulfilment, is one of the most critical factors for retailers.
The retail industry is one of the main drivers of employment around the world and a major contributor to the GDP increase of most Asian countries. The retail arena has been transformed through multiple market upheavals and strategic developments – from opening economies leading to true globalization in the industry to emerging markets rising as dominant competitors. Parallel to this, technological evolution created burgeoning business domains e.g. ecommerce, mobile applications, social media communication etc. establishing changing consumer preferences and expectations.
The industry has been historically the first avenue of employment for many new workers. The changing rules of retail combined with the upsurge of young, educated workforce in Asian countries has greatly propelled business growth and foreign investment. There is a need for stabilizing business culture and engagement which encourages the workforce to pursue opportunities in retail and form a stronger industry foundation.
“Asia has the potential to drive innovation in areas such as e-commerce and in developing new products. Japan, South Korea and Taiwan are home to some of the world’s leading electronics companies. And, China and India’s consumers are some of the world’s most active users of mobile technology and social media,” says Michael Cheng, PwC’s Retail and Consumer Leader for Asia Pacific and Hong Kong/China. “While shopping via social media platforms is still a new trend, it won’t be long before consumers jump on the s-commerce bandwagon.”
To understand and harness the dynamics of new-age retail, leading retailers and industry experts from across the world will be congregating at the 5th Annual Retail Congress Asia Pacific 2015, Singapore. As Key Partner to the event, ETP will be leading discussions on Asian retail and its emerging markets.
The term ‘Phygital’ is derived from the existing and emerging technology which employs the concept of bridging the gap between the physical and digital world, through convenient and interactive experiences.
In retail, phygital signifies the convergence of the physical and digital marketplace which helps brands and enterprises to engage customers on a broader spectrum and create a retail ecosystem which is truly seamless.
To cite a couple of examples, Tesco’s Homeplus pioneered the virtual supermarket where consumers scan the QR code of the product they’d like and the item is automatically added to an online shopping cart. Post payment through the secured mobile app, shoppers can continue towards home to find a bag of groceries on their doorstep. Brazilian fashion retailer C&A created a store with real-time “likes” counters on its clothes hangers. The like data was taken from C&A’s Facebook page where the clothes were listed for people to interact with, allowing customers at the store to see how many people online think that a particular product was a good buy.
The last couple of years have shown us the phygital marketplace is teeming with opportunities and retailers have just begun to explore and execute the same. In many ways, it is the organic evolution of the omni channel retail space with a multi-dimensional approach to not just increase customer reach and revenue but also create experiences that weave themselves perfectly into the customers’ lives.
Charles Darwin said, “It is not the strongest or the most intelligent who will survive but those who can best manage change.” Shoppers today have adapted to change and traversed onto the interchangeable, interdependent and integrated multiple channels of retail.
Global leaders in retail will engage and exchange their perspective and ideas on the evolution of phygital retailing at the Retail Congress Asia Pacific 2015. ETP Group is proud to be the Key Partner at the Retail Congress Asia Pacific 2015.
The retail industry is a competitive arena where mature players try to maintain steady growth and new players attempt to gain a stronger foothold. It’s no surprise that the customer regularly finds himself surrounded by promotions of all shapes and sizes! Also, gone are the days when these campaigns were linear and narrowly thought. Daily, scores of brands contest for the attention of the customer – who is getting increasingly demanding.
Retailers need to delve deeper into customer behavior and understand the three Ts – Temptation, Triggers and Turn-offs. The temptation route can be utilized for a promotion strategy with considering and evaluating the past purchase history of a customer. They are attuned to a more personalized offering style, as the products and services being promoted cover the ‘comfortable’ and ‘familiar’ ground. The trigger strategy contains a more philosophical approach – from basic human nature to specific target demographic group. As the term suggests, turn-offs are the promotion-product/service mix that have been, through a set elimination and deduction appraisal, deemed unsuccessful. In an overcrowded market place, where mismatched or irrelevant promotions may result into opportunity loss or customer defection, it is equally crucial to determine what is NOT working.
At this juncture, it is safe to say that analytics – both descriptive and predictive, form a big part of promotion strategy and management. Technology in various forms is the biggest carrying force to gain insights on customer preferences and expectations. At the retailer’s side, there are multidimensional tools like Business Intelligence modules, feedback programs, etc. and customers are quickly adopting smartphone technology and social media platforms. The latter feeds the former in this case, with customers sharing, visiting, buying on mobile phones and discussing, reviewing, connecting through social media. Data is collected across all these channels to collate and convert into logical patterns and advantageous acumen.
Post implementing the promotional campaign, retailers should create set processes to track the productivity and effectiveness of the campaign. Setting KPIs to key people, processes and products involved is a proven practice that ensures the different promotions running simultaneously are meeting their respective objectives. Adaptive contingency plans help support, sustain and streamline any changes required to deal with expected and unexpected situations. This saves time, operational costs and possible damage to the overall customer experience. It also creates necessary fail-safes to avoid hemorrhaging campaign expenditure, add to the bottom line and deliver value that boosts sales.
Market leaders in retail have been effectively using ETP Accelerator, across all their stores. They agree to have acquired better insight into customer demand and a covetable promotions trajectory. ETP Accelerator is a powerful marketing and promotions engine. It manages marketing campaigns in sync with customer/market trends – reducing implementation time drastically. It supports promotional strategies and business rules to be set and rolled out across operations instantly. This proactive solution allows multiple promotions and business rules to run concurrently without affecting process efficiencies. More importantly, the retailer can monitor the performance of each promotion strategy and redefine them as required.
Historically, the retail market has often run scarlet with a string of skewed trajectories, to favor either demand or supply. And as with any unsteady, volatile relationship, it has remarkably rebounded from one side to the other, with major economic implications. The most weathered and prominent page from the book of market misadventures would be the period of the Great Depression in U.S.A between 1929 and 1930. An overconfident market outlook without airtight economic policies lead to a swift and sudden stock market crash. The abundance of manufactured goods and materials with little or no demand led to investment prudence born from panic.
This led to the makings of the very first economic bubble the country had ever experienced. The market crash exposed its anemic financial composition and ensured that the public’s investments were washed-out by the federal banks.
The universal and most basic theories of demand is what determined World War II playing a crucial role in U.S.A’s recovery. The ongoing war and its increasing scale induced a large amount of government expenditure being routed in manufacturing of military weapons and technology. It also helped mobilize manpower, creating more jobs and rekindling the economy. Before the American entry in the war, its market once again stabilized with defense spending and military deployment, satisfying global demand and thus obliterating the last traces of the Depression. The U.S. went on to experience the greatest industrial and economic boom till date, growing by 37% in 1950s.
The above example represents the purpose and tumultuous two-sided effects of the proverbial coin. In this case, the coin would be the retail market and its consumers, the two sides are demand and supply. It teaches us the perils of flying blind without understanding the consumer motivation to satisfy his need and desire. On the other hand, it reminds us that strategically developing supply channels can swiftly turn the tide in your favor, leaving competition panting leagues behind you.
The deep penetrative expansion of the global market, producing varied product / service options from different geographies, has rendered today’s retail business to be more customer-centric. For retailers, the necessity to adopt and apply technology has magnified multi-fold. It arms them with the right Business Intelligence (BI) to easily capture and read complex customer data. This information is further broken down and analyzed to asses various customer behavioral, conditional and economical patterns and potential.
It helps them determine accurately the DEMAND:
What are his customers buying?
When and how much are they buying?
Why are they buying and for whom?
What are they buying from competition and why?
When will they come back to the store and for what?
What are their product preferences and how receptive they are to product modification?
What is the present and future wallet size of the customer?
What are the new customer demographics that can be targeted?
What promotions strategies and channels work for my business?
Basis the answers derived from the questions above, the retailer can optimize resources and his SUPPLY chain:
How many product lines will he need to manufacture/source in the upcoming season/cycle?
Which are the best vendors for particular materials or project?
What should be his pricing strategy and how best should he plan the mark-downs?
How much is the old stock and how soon can it be processed or sold?
How much is the dead stock and how best to utilize it?
Which are the fast moving locations and how many distributors will suffice?
When, how, where to restock at store, warehouse level?
Retailers can themselves or through expert buying teams amalgamate the science of determining economy growth, government policies, sanctions and market growth, risks and recovery methods with the art of understanding customer’s motivation, aspirations, likes, dislikes, future needs and market trends.
Proven to be the catalyst of this process – ETP V5 Retail Software Solutions successfully establish the balance between the demand and supply of a retail business. These can be implemented comprehensively or modularly, in premise or on the cloud, on virtually all platforms. This makes it easier to integrate the right Business Intelligence tools that optimize present and future market conditions, with respect to customers and competition both. ETP V5 Retail Solutions help retailers get it right in retail with stable, scalable innovations that drive operational excellence and increase profitable growth.
Naresh Ahuja, Chairman and CEO, ETP Group
