Retailers should take a deep breath and a big step back. While many new technologies have merit, true digital transformation starts with the basics: a well-defined strategy rooted in a firm understanding of consumer needs, a clear competitive differentiation, and sound economics. Online-only retailers have built their businesses around digital (and increasingly around mobile) technologies, and they have advantages that brick-and-mortar and click-and-mortar companies cannot duplicate. But the click-and-mortar approach has its own ace to play"”the power and reach of omnichannel interaction.
Consumers still can't touch, hold, try on, or taste a product online. The internet cannot provide the immediate gratification of instant ownership. Indeed, a number of online retailers have responded to these limitations by opening real-world stores. There are major opportunities for retailers to rethink category management"”including promotion, pricing, distribution, advertising, and point of sale"”for an omnichannel world. While every strategy is unique to the business it drives, we see a series of factors that all retailers need to consider.
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Keywords: retail supply chain, supply chain management, value chain, digital supply chain, supply chain IT, social media in retail
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