A key success factor in achieving retail excellence is the digitalization of retail.
Retail – hardly any other industry benefits so much from strong social and technological megatrends such as connected retail, e-commerce, chatbots, accurate forecasts, and flexible supply chain management. Retail, specialty, and wholesale companies that use these technologies strategically increase value-added and profit potential, address their target groups more specifically, and operate more efficiently in the competition.
At the same time, the Supply Chain Act and the Climate Change Act present new challenges, but also new opportunities for retail and logistics. Trends such as social and environmental sustainability, recycling, and the circular economy are reflected in broad, high-income sections of the population that retail should exploit. “Better know your customer” and the targeted individual addressing of different customer groups via all touchpoints along the customer journey will become even more important.
Retail Excellence with Business Analytics
Identify potential for optimization and increase value creation with valantic’s Business Analytics.
SAP services and solutions for retail
With expertise and custom-tailored solutions approved by SAP, we help our customers in all retail sectors successfully implement their business strategies.
The value-added analysis of the data
The basis for successful action, which is consistently oriented toward the customer and business goals such as sales optimization, efficiency, and agility, is the integrative analysis of the entire data stream from product development, allocation, and production, on through to delivery to the retailer. Smart Big Data analytics helps you achieve these goals.
Smart Big Data analytics from valantic increases value-added potential along the entire data stream, from production to delivery to the consumer. (Source: valantic)
In no case should the hygiene factor cybersecurity be neglected. Retailers need to guarantee secure e-commerce, secure ordering, and payment processes in order to ensure that their customers’ trust is not compromised. The valantic Group’s cybersecurity experts have more than 15 years’ experience; they assist companies in setting up and operating their e-commerce platforms safely.
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valantic has identified five key trends that will shape the retail sector in the future and for which specialists, retailers, and wholesalers should prepare.
Retail Excellence Trend #1
Of course, the goods should be available in the shop in sufficient quantities, and, if possible, should be delivered to the customer on the same day for online orders. With an average of 20 to 30 new collections in the fashion industry or the fresh supply of food retailers, this logistical masterpiece requires strong, flexible supply chain management that can handle bottlenecks and last-minute changes safely.
Realize great optimization potential along the entire retail value chain, from supply chain and logistics to store operations and marketing. (Source: valantic)
Efficient warehousing, smart intralogistics, and the shortest routes for delivery and delivery vehicles not only reduce time and costs, they also help to conserve resources. Efficiency and sustainability join hands and work as a team. valantic has decades of expertise and helps retailers, specialists, and wholesalers achieve optimal supply chain excellence. The key to retail excellence is the digitalization of retail and the whole retail value chain.
Strategic recommendation for action:
Supply Chain Management
With valantic supply chain management, you can be more agile, efficient, and successful!
The new Supply Chain Act makes “corporate social responsibility” legally binding. It obliges German companies to trace and avoid production and production conditions that are harmful to the environment or violate labor law at their foreign suppliers. Transparent supply chain excellence provides clear benefits and helps to meet all obligations required by law.
Current customer project at HOHNER and SONOR with high added value
Musical instrument manufacturers HOHNER and SONOR optimize their supply chain management with valantic.
Retail Excellence Trend #2
Accurate forecasts using historical data and smart analysis algorithms provide a solid foundation for small inventories and lower costs. Integrated business planning unites the strategic, tactical, and operative planning processes in a system environment such as SAP.
Strategic planning includes the business planning: the determination of the network nodes to be planned such as sales locations, warehouses, production plants, and suppliers; the financial and budget planning, and strategic sourcing of production capacities.
Tactical planning consolidates all information relevant for the sales plan and, in the process of comparing demand and supply, creates a feasible plan taking into account goals defined internally. Sales & operations execution includes customer order management, operational scheduling, and production fine planning and processing. As a result, companies can make their entire value chain transparent end-to-end and react quickly and flexibly to changes.
valantic’s business analytics consultants and experienced solution experts can help you achieve your strategic and tactical goals in the best possible way.
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Retail Excellence Trend #3
The four keys to success in “new retail” are customer orientation via all touchpoints (customer centricity), convenience, customization, and positive customer feedback (contribution) in social media and other communication channels.
Individual, specialty, and wholesale distributors who consistently focus on customers and their needs and make product searches, advising, the discovery of new offerings, and the payment process as pleasant as possible, will be the most successful in the future. Every point of the shopping trip should be designed for customers as if it were made individually for them.
Strategic recommendation for digitalization in retail: Customer experience solutions
Optimal customer experience – smart solutions for customer relationships and sales from valantic.
However, the four keys look different for each age cohort and customer target group. Young digital consumers expect great customer service, omnichannel fulfillment services, and personalized recommendations. They expect goods to be delivered within a day, they want to pay in the shop on the go, and they willingly provide positive and negative feedback on their shopping experience on social media.
Young digital consumers use chatbots and conversational AI, because the technology spares them long wait times when seeking sales advice and in the support center, and it is available immediately. Acceptance has increased noticeably in recent years, and conversational AI is becoming more and more powerful and generating real, informative added value for this target group.
Traditional customers tick differently and want classic bonus programs, they value product availability, complain to the retailer personally, and only use new technologies if they are easy and comfortable to use. The analysis of customer data (customer-centric data) and precise knowledge of the customer generations is therefore crucial for retail. A target-group-specific approach to customers today, but even more in the future, will make a significant difference in a retailer’s market success.
Current customer project at Vileda
Perfect global customer experiences around the world at Vileda – central platform for B2B and B2C with the SAP Commerce Cloud.
valantic has decades of experience in the practical use of business analytics and conversational AI technologies, as well as in the definition of user stories. We will be happy to help you create the perfect customer experience for every customer on every sales channel. The investment pays off because when customer satisfaction increases, sales and profits also increase. Satisfied customers also act as brand ambassadors and are happy to come again.
Retail Excellence Trend #4
A heterogeneous clientèle with different preferences, rapid technological development, and completely new forms of distribution require a high degree of creativity and innovation from retailers. An analysis of the 1,000 largest online stores shows that one in two providers has brick-and-mortar stores. Even purely online retailers are increasingly opening up permanent locations. For experience has shown that many people want both: the exciting shopping spree in the city the quick, comfortable ordering from their living room.
However, both purchasing processes should be seamlessly linked and coordinated to provide customers with an optimal shopping experience. Click & collect, for example, refers to shopping where the goods are ordered online and collected in person at the retail store. Customers prefer to click & collect because of its many advantages: there are no shipping costs, people who have jobs can be flexible in terms of time, and self pick-up usually goes faster than most shipping options. In addition, questions can be clarified directly with specialist advice on-site.
During the pandemic, many buyers learned that online shopping is not as difficult and complicated as they thought. Online shopping and e-commerce have enjoyed high double-digit growth rates in recent months. In the consumer electronics and fashion market segments, 25 – 30% of the goods are already sold online. This trend toward e-commerce will continue to gain momentum.
The strong trend toward e-commerce is confirmed by a survey conducted by valantic at the beginning of the year among more than 200 managing directors and business analysts: 41% of survey participants want to exploit e-commerce as an additional sales channel and invest more heavily in their online business in order to be better equipped for future crises.
Another 41% of the survey participants have put optimizing their operational flows on their to-do list, and 39% are striving to increase their overall operational performance – for example, by using digitalization and automation technology. The digitalization of retail is the key to more sales and success.
Efficiency benefits, for example, due to robotic process automation (RPA), can be realized in just a few weeks and with mid five-figure budgets. Robotic process automation (RPA) in retail’s back office, accounting, and controlling departments increases the integration density and generates significant time and efficiency gains. RPA automates repetitive, largely rule-based business processes where low-level decisions of low complexity have to be made.
The benefits: Your employees are relieved of manual routine activities and can devote themselves to higher-quality activities. RPA projects last only a few weeks, require low five-figure budgets, and generate clearly quantifiable benefits. valantic’s experts will be happy to advise you.
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Retail Excellence Trend #5
The physical presence in the city centers has suffered significant business losses due to the coronavirus pandemic and the associated restrictions. However, you can score points with a multi-sensory holistic experience for all five senses, which e-commerce has only offered to a limited extent thus far despite promising virtual reality approaches. Retailers and specialty retailers will therefore increasingly design their physical locations as multimedia showrooms and as an experience world, where the focus is not on the direct sale of the goods, but on increased customer loyalty to the brand.
The retail experience creates spaces that don’t look or work like stores at all. It uses them to bring the brand to life. Each store is filled with unique sculptures and installations. People can also visit the stores just to photograph or explore, which in turn familiarizes them with the brand. Gastronomic services as well as sports and cultural events in the sales areas expand and complete the range of experiences.
In the future, it will no longer be a question of whether customers make their purchases offline or online. Both channels have become a matter of course and converge to ensure that customers experience extraordinary experiences all the time. Immersive retail-as-a-service , enjoyment, and experience worlds allow the customers to immerse themselves in a dreamlike world, one connected to the real, physical shopping journey.