The UK retail sector is under siege from all fronts – a global recession, increased energy bills, increasing commodities prices driven by climate change (cotton, wheat, milk) and pressures from online retailers whose overseas operations give an unfair tax advantage. Add all of this to the increased awareness of consumers who can now check out competitive prices on their smartphones whilst standing in store and you have a recipe for very concerned looks on the faces of all retail executive teams.
Retailers are very good at forecasting the future, the stock we see on our shelves today was predicted, sourced and procured at least a year ago, unfortunately they are not good at responding quickly to external environments. This year the shops were full of summer clothing stock, actually what we all needed to cope with the horrible British summer was nice warm jumpers! This inability to respond to change is not confined to the merchandisers; most retailers have not kept pace with the rapid change in technology and certainly have been caught out with the rapid adoption of the new digital aware consumer. For example one well known high street retailer I visited recently had employed a person on a full time basis to dial up over a thousand telephone numbers of their stores to find out if they were fax numbers or store numbers or back-up numbers to their aging ISDN lines – BTW they had estimated that this project would take a year!
So it’s no wonder that the IT and digital departments are under cosh. On one hand they are fighting to keep the business rolling and on the other they are trying to build new and innovative digital experiences on the foundations of old and decrepit systems that are impossible to change. So far mobile has presented all retailers with opportunity and challenges in equal measure, most retailers have now delivered a mobile offering, the challenge for retailers now is to keep up with the pace of change that mobile will present, no sooner than a project is live it will be out dated by a competitor’s offering.
The big prediction for mobile in 2013 is the rebuilding of back-end architecture and systems in order to be able to keep pace and deliver the campaigns and digital updates that will be demanded by tech savvy and mostly fickle consumers. Forrester are predicting the “decoupling” of e-commerce and content management system that will need to work in synergy with advanced “super rendering” platforms that detect devices, location and user habits in order to deliver timely and contextual content.
Catching the consumer at the right moment with the right content and right offer will win through but this can only be delivered cost effectively with the right systems in place. Retailers who refuse to rethink their systems and continue to try and adapt using old technology, methodologies and techniques developed for the desktop era will fail to keep pace and perhaps will fail completely as a result.
By Phillip Clement – Twitter -@PhillipClement
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Published on: 12:23PM on 28th January 2013