We are excited that JustEnough was recently recognized by Retail CIO Outlook as a Top 10 Merchandising Solution Provider for our extensive business process knowledge combined with our in-depth, integrated and innovative retail planning solutions.
This annual list features the best solution and service providers offering tools and services in the Retail Merchandising landscape and assists CIO’s in finding the right technology solution providers to help them succeed in today’s fast-evolving digital retail environment. The Top 10 listing provides a look into how these solutions work in the real world so that organizations can gain a comprehensive understanding of what technologies are available and how they shape up against the competition. Companies are selected for the Top 10 list by a panel of industry and technology experts and members of Retail CIO Outlook’s editorial board.
JustEnough’s inclusion was based on evaluation of our omni-channel retail planning software that enables retailers to merchandise assortments and maximize product inventory across physical and digital channels so products are available when and where shoppers want them. The evaluation was across more a dozen quantitative and qualitative elements taking into consideration our experience, industry recognition, technology, market presence and positive client reviews.
You can read the complete JustEnough profile in the report here.
I was recently quoted in an interesting article in the latest issue of OnWindows magazine about how Microsoft and its partners are supporting retailers as they look to reinvent themselves and meet the needs of the modern consumer. Here is the article.
With digital technologies having a major impact on the daily lives of consumers across the world, there is a growing pressure on companies to reinvent themselves and make a digital transformation of their own.
“It’s a true revolution, not unlike the industrial revolution in its own way,” explains Tracy Issel, general manager of the worldwide retail industry at Microsoft. “The digital business is the reaction to the incredible amount of change that is happening around everything technical. But it’s not just technical – it’s actually about the way people work, the way people engage in their personal lives, and the way we use information to better understand the needs of people.”
Indeed, with their mobile devices never far away, the modern consumer is always connected – and the impact on retail is huge, as JustEnough’s Caroline Proctor explains: “To keep up with digital consumers, retailers have become digital by adding online and mobile channels and engaging through social media,” she says. “Digital businesses embrace everything today’s digital age offers to get closer to their customers and deliver what those customers want, when and where they want it.”
This requires retailers to expand their thinking across every channel. “The digital change has resulted in the merging of traditional commerce and e-commerce,” says K3 Retail’s Tony Bryant. “As consumers are now interacting across various channels, there is an expectation for a seamless and integrated experience throughout the entire purchase journey.”
To achieve this, retailers need to better understand their customers – how they behave, what they buy and what makes them come back for more. This requires greater levels of insight. “Data is the new currency for business. It’s all about data and what we do with that data, in the planning on the frontline, at every step of a transaction or an engagement,” Issel says.
“Businesses today are able to create a more valuable in-store experience by starting with the customer’s viewpoint,” adds Scala’s Tom Nix. “By looking at data - website clicks, actions on a mobile app, purchase history – and bringing in digital, messaging is personalised, refined and rapidly adjustable.”
Wincor Nixdorf’s Sabine Grün agrees, adding that digital data processing is ‘the most important economic growth driver of our time’. “As consumers are now interacting across various channels, there is an expectation for a seamless and integrated experience throughout the entire purchase journey,” she says.
“If you can make sense of your data, the sky’s the limit,” adds LiveTiles’ Nick Rameka. “Chief marketing officers are fast becoming the key decision maker in the purchase of business technology. Technology that details buyer behaviour will always demand the attention of marketers and the boardroom.”
With the amount of data now available, the cloud also has a vital role to play. “The intelligent cloud helps users understand what to do with that insight. Without an intelligent cloud, the amount of data that exists would overwhelm a company,” Issel explains.
The cloud is enabling a more dynamic approach to data, as Simplement’s Robert Maclean testifies. “With the cloud, I’m able to build a value network that gets customer-facing information,” he says. “Furthermore, manufacturing processes and demand generators are becoming more closely coupled. The time is decreasing for that information to flow through, and thanks to the cloud, I can now plug in different applications against that stream of information and do different things with it. I am no longer tied to a monolithic system – I’m able to have an adaptable system. That was previously not possible.”
NEAL Analytics’ Greg Gomez agrees that both cloud computing and analytics in the cloud are having a transformative effect. “Platforms like Microsoft Azure and analytics suites like Cortana Analytics eliminate the barriers of entry and enable companies to scale these capabilities across a broader swath of business functions,” says Gomez. “As these technologies are being democratised, they fuel the transformation to a digital business.”
Issel believes that the ability to improve productivity is another very exciting space, and points to tools such as Yammer and Skype for Business as being able to enable greater collaboration, training and sharing. And while this internal element is vital, Issel explains that it is in the personal computing space that the information that is gathered and analysed is then bred for action.
“Every professional that takes advantage of data and the intelligent cloud is also a personal computing consumer,” she says. “Therefore, making personal computing more personal, leveraging a more natural user interface, leveraging something like Cortana for an executive assistant for example, is massively important.”
Overall, Issel says that with the right combination of digital technologies retailers will create more productive business processes and enable the derivation of more outcome. “Then the intelligent cloud helps users understand what to do with that insight, and personal computing is where that information breeds action.”
Though times and technologies will continue to change and advance, one thing will remain continuous: the need to appeal to customers. Be it by reinventing internal processes to improve employee productivity, or rethinking the way they connect with customers, in a digital age such as this, retailers cannot afford to leave any stone unturned.
You can view the article online and check out the rest of OnWindows here.
Check out the lead article in the most recent issue of JustEnough’s InDemand Newsletter and click here to read the entire newsletter.
We recently showcased our new Customer Insights solution at National Retail Federation's (NRF) BIG Show 2016 in New York City. This solution is uniquely positioned to enable retailers to analyze customer data and turn it into actionable insights to optimize merchandising, assortments, promotions and pricing.
Retail’s consumer-centric transformation brought into focus the need for retailers to develop capabilities to quickly analyze customer data across all channels and touchpoints and to have technology that supports customer data-driven decision making. Merchandise planning has traditionally been product-centric and largely based on merchant intuition. Now with consumers in the driver’s seat in today’s omni-channel and digital age of retail, that approach needs to change. EKN Research recently reported that the lack of customer insights in the merchandising process is the number one merchandising challenge for retailers1.
JustEnough Customer Insights helps retailers to make the transformation from traditional product-centric planning to truly customer-centric planning. This shift in focus is critical for retailers hoping to compete for today’s demanding consumers.
Some of the key features and advantages of JustEnough’s latest solution include:
Create and Manage Different Segmentations for Different Organizations
Customer segmentation was pioneered by Marketing organizations – but marketing segmentations focus on what communications inspire customers. They don’t help the Pricing organization understand which customers are most likely to respond to a price change. Nor will it help Merchandising to understand if there are holes in their assortments. Each organization needs their own segmentation – and you need a platform that can help bridge and manage all these segmentations so it doesn’t get out of control. If someone tells you “we have a segmentation – Marketing is doing that” then you definitely need JustEnough to enable your entire organization with targeted and unique segmentations.
Purpose-built Insights for Apparel and Specialty Retailers and Wholesales
At JustEnough, we know apparel and specialty retail – it’s our focus and passion. Our platform was built from the ground-up for your business. It effortlessly handles seasons and tracks customer behavior from one assortment to the next. Our promotion and coupon algorithms are unmatched in the industry, as is our ability to create a unified view across brands, divisions, countries and channels. For example, you can see in one view the effectiveness of coupon campaigns in terms of increased traffic and changes in basket value or view affinity and understand what products are purchased together.
Act on What you Learn – in the Same Solution
An insight is only valuable if you can act on it. Because the JustEnough solution is a unified platform, you can effortlessly make pricing changes, modify promotions and drive your assortments based on the customer insights you capture - all in one platform.
Rich, Intuitive Data Visualization
Our solution delivers intuitive visualizations that provide you the right level of information needed to make decisions fast. These include maps so you can see your sales and customers geographically. Decomposition allows users to drill down into the data to see the details behind it, like what customers are behind that bump in sales and what customer segments respond to which promotions.
No Data Scientist Required
Our Data Scientists did all the hard math so you don’t have to. Let’s face it. Your business is retail. You don’t have time to find, hire and manage a team of data scientists. Our Customer Insights’ engine has all the heavy math built in. Put our tools and widgets in the hands of a curious analyst who understands retail – and together they’ll create magic.
“Customer centricity has come to the forefront as a critical component of the overall retail planning process – especially as consumer expectations for getting the products they want, when and where they want them continues to increase,” said Malcolm Buxton, CEO & President, JustEnough. “Our solutions were built from the ground up for omni-channel planning and by embracing actionable insights from customer data retailers using our solutions will gain the efficiency, relevancy and agility needed to prosper in today’s omni-channel retail environment."
We look forward to helping additional retailers to analyze their customer data and action valuable insights to drive their retail planning. Visit our website or contact us at firstname.lastname@example.org to learn more about how JustEnough can help make the most of your customer information.
1EKN's 3rd Annual Merchandising in Retail Benchmark Report
Once the foundation described in my last post is in place, retailers are in a position to optimize their planning across all their channels. Here are some strategies to consider:
Capture True Demand
As discussed earlier, today’s retail sales may originate online, but are often fulfilled inside a store. Besides requiring visibility into enterprise-wide inventory levels, equally important is having the proper merchandise available at the consumers’ fulfillment channel of choice. This requires retailers to distinguish between sales demand — where the order is placed — and fulfillment demand — where the order is fulfilled from.
By capturing and analyzing both sales and fulfillment demand, retailers have the opportunity to build assortments for individual sales channels based on sales demand, while optimizing inventory based on fulfillment demand. With insight into these two mission-critical streams of data, retailers gain visibility into true demand.
Optimize Cross-Channel Inventory
In the world of “order anywhere, fulfill from anywhere”, inventory visibility and accuracy is paramount. Even the slightest inaccuracies in inventory counts can lead to out-of- stocks, resulting in lost sales and more importantly, disappointed customers. To avoid these unnecessary issues, retailers need to ensure inventory accuracy and visibility across all channels and distribution options. Besides offering the opportunity to position inventory where it is most likely to be needed for fulfillment, inventory optimization also ensures desired products are available for sale wherever the demand arises. It is such a mission-critical strategy for omni-channel success that 74% of companies are revamping their inventory planning strategies to increase execution and shopper satisfaction, according to EKN.
Build a Cross-Channel Universal Assortment with Localization
Catering to customer preferences is a pre-requisite for omni-channel success. In fact, the more personalized retailers can make the experience, the stronger the customer/retailer relationship becomes. As a result, execution of localized assortments is also becoming a key differentiator in an increasingly saturated omni-channel marketplace. However, it also remains a highly complex undertaking. It requires companies to rationalize assortments based on sell-through of their selling channels, as well as to identify the appropriate breadth and depth across the channels. By developing a universal assortment that serves as a menu from which the planners can create channel-specific assortment offerings, retailers are better positioned to cater to local trends and plan for variances across the assortments and channels. Implementing a strategy that enables re-actability enables the flexibility to shift or adjust assortment strategies resulting in a healthier bottom-line.
Listen to Customers When Planning Physical and Digital Space
While omni-channel is often associated with an evolving digital backbone, the physical store is still the heartbeat of the experience, albeit that severe changes are underway. Besides featuring more digital touch points to interact with shoppers, savvy brands are also restructuring stores to help consumers complete their shopping journey in an efficient and satisfying way. This includes having merchandise and procurement options available at a moment’s notice. These evolving trends underline the need for localized and effective space planning solutions.
No longer applied to traditional floor plans, next-generation space planning models now must address new formats (including smaller footprints and even pop-up locations), expanded categories and dedicated real estate for in-store pickup. To ensure they can satisfy shoppers’ new omni-channel expectations, new store models must be based on shoppers’ navigation and purchase patterns across categories, store locations, channels and departments. This insight gives retailers an understanding of how to more effectively plan their store layouts in a method that not only addresses customer behavior, but is also developed to increase revenue.
Leverage Increased Opportunities for Customer Insights
Customer demand data clearly opens up a wealth of opportunity for retailers, especially as an omni-present business model that is by nature, consumer-centric, continues to evolve. With insights centered on understanding what shoppers buy, how they buy, when they buy, what they pay and why they buy, retailers are primed to target products at customers across all their selling channels. The power of affinity analysis on the customer and purchased product enables retailers the opportunity to upsell complimentary products to the customer when they have the highest intent to buy.
Execute Meaningful Pricing Strategies
A big challenge for many retailers is how to manage pricing in an increasingly omni-channel world. Sales channels are no longer separate entities for customers. They expect to pay the same price for a product or service regardless of where the transaction occurs and this is a struggle for many brands. Too many still present inconsistent or fragmented pricing strategies that can lead to customer frustration, confusion and distrust.
A clearly defined pricing strategy that takes into account customer exposure to multiple channels can ensure that customers are confident in an organization’s practices. Sure, pricing differences are often required based on regional differences or seasonal markdowns, but overall, it’s important to offer consistent pricing across channels. To avoid alienating loyal shoppers in the strategic pricing game, it’s best to build a base omni-channel pricing strategy and to manage exceptions, when dealing with products that are timely or seasonal, to avoid negative impacts on the bottom-line.
Retailers that are serious about long-term omni-channel success need to break down the channel planning and system silos and put the foundation in place on which they can deliver the cross-channel shopping experience that customers expect while also achieving their financial goals. Setting this foundation requires a focus on the four pillars of process, people, data and systems.
The transformation to true omni-channel planning and execution starts with redefining business processes. In a siloed organization, each team has its own processes and typically systems. By breaking down these operational silos, retailers can more easily streamline their planning processes, and more importantly, integrate these processes across new and emerging channels. So before moving onto the other pillars, cross-channel business processes must be defined and a change management strategy formulated to help the organization successfully make the transition.
This magnitude of change doesn’t happen overnight, and more importantly, it doesn’t just evolve. Rather, it comes from a culture change — one that is championed from “the top down.” Once the culture is in place, the next step is for retailers to restructure their teams to support the roles within the new omni-channel planning processes. Change management will play a key role in helping team members to understand and adapt to their new roles and responsibilities.
More digital touch points means one thing — a higher volume of incoming data. As new customer-facing solutions are adopted, so are new sources of information created. Simple structured data sets have given way to unstructured data created by the marketplace’s many digital touchpoints, including mobile and social media.
While 82% of retailers reported that big data is a pre-requisite to changing the way they interact with and relate to their customers, according to “e,” a report from Accenture, big data is growing exponentially and entering companies’ data warehouses so quickly, that many struggle with how to harness this fast-growing information. Those that can manage to centralize this information and then apply predictive business analytics will be poised to accurately determine inventory levels and better allocate merchandise assortments to specific channels based on consumers’ real-time demand.
This effort not only delivers better visibility to merchandisers, it also better positions merchandise enterprise-wide.
While technology alone cannot solve business problems, it is most definitely the enabler of success once the other three pillars are in place. For example, by implementing modern systems, retailers can share data freely across the enterprise, as well as gain a single version of the truth regarding customer information, inventory and stock levels, as well as product movement. It is the final piece of the omni-channel merchandising puzzle, and the pillar that supports the information needed to drive the company’s overall merchandising strategy.
The retail industry is changing on a seemingly daily basis, and at the core of this change is the customer. Customers are increasingly comfortable with technology, which is driving their demand for more digital interaction with their favorite brands — a factor that is making the retail landscape increasingly digital. Besides giving consumers more control of their shopping experience, this omni-present retail landscape enables shoppers to “channel-hop” throughout their shopping journeys as they browse, purchase and fulfill orders using the combination of channels that best suits their needs.
A pre-requisite for 21st century retailing, omni-channel has become a mission-critical strategy for any company that is preparing for their longevity. As a result, omni-channel has become the highest technology investment priority, according to RIS News’ “The 12th Annual Store Systems Study: Retail Technology Spend Trends” report.
The evolving digital experience — and consumers’ expectations — is making the retail model more unpredictable than ever before. This shifting business model requires that brands can merchandise assortments and maximize product inventory across physical and digital channels so merchandise is available when and where shoppers are ready to make a purchase.
However, an array of challenges continue to impact the move to this next-generation retailing model. Among the top issues are:
Even as we approach the second decade of the new millennium, there are still retailers relying on technology, including planning systems, which were developed and installed in the late 1990s to address what was expected to be a catastrophic Y2K issue, as described in the “2015 Merchandise Planning Survey” from Boston Retail Partners. However, fast-forward almost two decades, and retailers are still trying to conform these antiquated legacy systems to support evolving multi-channel strategies — efforts that often fail. More specifically, 72.5% of companies say their systems are still underdeveloped, or worse, absent in the quest for connecting the end-to-end shopping experience across channels, according to “A New Era for Retail: Cloud Computing Changes the Game”, a report from Accenture.
The traditional planning process is conceptually straightforward: identify what to sell, who to sell it to, at what price to sell it and then ensure the product is where it needs to be on time. This is simple when applied to individual selling channels. However, with customers expecting a seamless experience across a retailer’s selling channels, it has become very complex to deliver customers the experience they expect while maintaining a healthy bottom-line.
As retailers have added channels, they often set up silos of planning and inventory for each channel. In fact, 49% of retailers still operate separate inventories across channels, according to Boston Retail Partners’ “2015 Merchandise Planning Survey”. Operating siloed processes and disparate systems only increases operating complexities, and can lead to out-of-stocks or overstocks, both of which negatively impact margins. Specifically, these disparate systems can contribute to up to 10% sales losses enterprise-wide, according to “The First Annual Customer Engagement Tech Trends Study: The Personalization Imperative”, a report from RIS News and Edgell Knowledge Network.
This siloed approach might have worked when most consumers shopped within specific channels. However, today’s consumer moves seamlessly between channels when shopping and also expects flexible fulfillment options, like buy on-line and pick-up in store. Retailers must plan and manage inventory across all their channels in order to satisfy customer demand while meeting their financial objectives.
As consumers are demanding that their shopping experiences become more digital and interactive, it is not surprising that social media is gaining traction in the retail journey. From an internal perspective, retail marketers rely on social networks to bolster their reach, using the medium to share content, deliver channel-specific promotions, and most importantly, directly interact with their loyal shoppers. According to Nielsen, 77% of shoppers say ‘social exposure’ and validation of a product is the most persuasive source of information, and does indeed drive them to make more purchases.
However, it can make or break brand image if not managed correctly. Retailers often forget that consumers use the medium to interact with their peers, and waste no time in sharing their experiences — the good, bad and ugly. Rather than respond to negative comments — many which tend to revolve around mismanaged inventory and poor customer service — that chip away at retailers’ reputations, many often try to resolve the issues by increasing inventory levels in hopes of satisfying customer expectations. While this approach may help the customer experience, it more often leads to increased operating costs, a move that negatively impacts margins.
JustEnough today announced the release of its newest module - Customer Insights - that is uniquely positioned to enable retailers to analyze customer data and turn it into actionable insights to optimize assortments, promotions and pricing.
We will be showcasing Customer Insights at National Retail Federation's (NRF) BIG Show 2016 in New York City, January 17-20. Attendees interested in learning how Customer Insights can help turn data into actionable insights are encouraged to visit Expo booth 3976 or contact us to schedule a time to discuss.
Retail's consumer-centric transformation brought into focus the need for retailers to develop capabilities to gather and analyze customer data across all channels and touchpoints and to have technology that supports customer data-driven decision making. Merchandise planning has traditionally been product-centric and largely based on merchant intuition. Now with consumers in the driver’s seat in today’s omni-channel and digital age of retail, that approach needs to change.
JustEnough Customer Insights helps retailers to make the transformation from traditional product-centric planning to truly customer-centric planning. This shift in focus is critical for retailers hoping to compete for today’s demanding customers.
With the support of JustEnough's latest solution, retailers can:
- Analyze customer behavior to understand which customers are most important to their business
- Segment and cluster customers to localize and personalize assortments
- Identify which promotions mobilize their best customers and personalize and target promotions
Please visit our website to learn more about Customer Insights.
This is the last article in our series based on a research report JustEnough recently sponsored with Boston Retail Partners into the current state of the industry around Merchandise Planning which uncovered strategies that retailers can focus on to enable effective planning in today’s omni-channel world.
I hope you enjoyed this series of articles. Please contact us, if you would like to learn more about how JustEnough solutions are helping leading retailers to successfully plan for their omni-channel operations.
Here is the final part:
The right technology tools
As mentioned earlier, a combination of appropriate tools and systems are necessary to fully support the omni-channel environment. Absent the right technology – with the processes and organization to support it – omni-channel strategies fail to achieve maximum efficiency and benefit for retailers. Best practices dictate the use of a full suite of planning tools working as an integrated system. This year’s survey results reveal that while retailers realize that their current systems are inadequate and that there is a need for better tools, the situation cannot be remedied overnight. Retailers realize there is still significant opportunity to enhance their planning capabilities from a technological perspective.
Fully integrated solutions have not gained vast acceptance into the systems landscape at most retail organizations. Leveraging robust tools that allow for unified management of transactions across all channels will become increasingly vital for retailers who seek to succeed in an omni-channel environment.
A fully integrated omni-channel environment requires a solid technological foundation. As the survey shows, retailers are starting to appreciate the urgency behind system improvements. However, transitioning from legacy systems and spreadsheets continues to be a challenge. The inability to fully embrace integrated systems will inhibit efforts to provide a truly omni-channel retail model. Those keeping pace with technological developments will find themselves at a definite competitive advantage until the rest of the industry is able to catch up.
Unfortunately, spreadsheets are still prevalent in the planning process, especially in assortment planning where 42% of the respondents utilize a spreadsheet (Exhibit 13). It is also interesting that a number of retailers use a combination of applications for their planning requirements.
Exhibit 13: Application type
Many retailers indicate their planning applications are lacking effectiveness (Exhibit 14). It is interesting to note that the effectiveness of applications seems to follow the application type. Vendor or homegrown apps are more effective than spreadsheets. Overall, retailers are not happy with their applications, which leads to the massive planning application upgrades/replacements planned for the next two years.
Exhibit 14: Application effectiveness
Retailers face many issues with planning systems. As mentioned earlier, many systems were replaced in time for Y2K and may be out of date. Many systems don’t have the capabilities needed to effectively plan in this ever-evolving retail environment. Some retailers are dealing with budgetary issues as the retail industry has struggled in the last few years. Others may have good intentions to upgrade their systems to accommodate an omni-channel environment, but struggle with what to do and how to do it. This is certainly a challenging time to be a retailer, however, there is a realization in the industry that changes need to be made to update the planning process, and that is certainly the first step towards success.
Savvy retailers know they have a problem with their current planning systems – they are ineffective and out-of-date – and most are beginning to take action. The good news is that there are some very good tools available to address these outdated systems, but technology is only part of the solution.
To successfully meet the needs of an omni-channel world, the people and processes involved to support it are just as critical to address, and the systems must integrate analytics with operational processes and solutions. The imperative is to address these issues before disenchanting today’s ever more demanding customer.
Standing still is not an option – what are you going to do?
You can read the complete BRP 2015 Annual Merchandising Planning Report here.
The Washington Past recently published an interesting article about how the holiday season is showing how many retailers aren’t prepared for new fulfilment options customer expect - especially buy online, pick up in store.
Here is what the WP found:
Retailers this holiday season have been aggressively trumpeting “click-and-collect” shopping, a relatively new hybrid of digital and old-school buying that allows time-starved customers to place an order online and pick it up within hours at a counter in a store.
But so far, many shoppers are finding it to be a big headache.
Fully 60 percent of such orders placed on Cyber Monday ran into problems, one study found. The wrong items were received, or orders were cancelled because the product was no longer in stock. Sometimes there was no notification an order was ready.
Shoppers in droves have taken to social media to complain about long waits at the service counter and other issues, an outcry that could get louder as a crush of gift-buying procrastinators begin descending on store counters in the final days before Christmas.
Read the complete article here.
JustEnough is helping leading retailers to successfully plan their omni-channel assortments, inventory and allocations in order to meet the demands of today’s consumers. Contact us to learn more about how we can help you overcome omni-channel planning challenges.
This is the sixth article in our series based on a research report JustEnough recently sponsored with Boston Retail Partners into the current state of the industry around Merchandise Planning which uncovered strategies that retailers can focus on to enable effective planning in today’s omni-channel world.
We will continue to look into the elements the survey found that retailers can focus on to enable effective planning in an omni-channel world. Please contact us, if you would like to learn more about how JustEnough solutions are helping leading retailers to successfully plan for their omni-channel operations.
Here is part six:
A holistic pricing strategy
Strategic pricing is critical to effectively meet customer demands and ensure they continue to shop your brand. Moving to an omni-channel environment makes pricing even more challenging as customers now have access to pricing from different channels.
The capability to strategically price goods throughout the season allows retailers to improve gross margins and profits. Currently, retailers formulate pricing strategies based mostly on seasonality, store clusters and promotional calendars. Unfortunately, this dated approach is often inflexible and forces retailers to systemically take markdowns on items that would continue to sell at a higher price in certain stores. For instance, while swimsuits may typically not sell at full price in cold weather stores in December, stores in New York may be able to sell them given their high traffic levels and number of international customers.
Traditional merchandise planning tools make it difficult, if not impossible, to execute a more nuanced pricing strategy. Also, older tools, lacking advanced analytics, might miss dynamic pricing opportunities and execute the same price at all stores in the same cluster.
Omni-channel planning tools allow retailers to take advantage of selling goods in the most profitable channel. While at first glance it may seem illogical to transfer goods from store to online fulfillment, an advanced planning tool will recognize at what price a transfer makes sense.
Finally, retailers should look to move towards dynamic pricing across channels to maximize margins. While this is still a distant dream for most retailers, a cross channel dynamic pricing model would allow retailers to recognize customers and offer them the price that they are willing to pay, and that is most profitable to the retailer. Some retailers are already utilizing such technology on the web, but this same idea could find its way into more brick and mortar retailers in the future.
Currently half of the respondents utilize the same prices across all locations and channels (Exhibit 12).
Exhibit 12: Pricing strategy
You can read the complete BRP 2015 Annual Merchandising Planning Report here.