Retail businesses have always had to deal with flux, but the disruptive nature of change today demands new approaches, as Aptos’ Richard Willis outlines.
The changes sweeping through retail today are happening faster and reaching further than anything we’ve experienced before.
Even though the sources of that change and disruption may seem endless, we’ve found they actually come together in three core megatrends:
- Consumer behaviours change all the time: with less time and money to spend on themselves, today’s consumers prioritise experiences and self-care over shopping.
- Traditional approaches to growth are dead: familiar business models and paths to growth are eroding. Retailers at the cutting edge are doing things differently – starting online then building digital, hyper-local communities.
- A new wave of technology disruption is on the horizon: retailers must prepare for ‘recombinant innovation’ — using and combining existing technologies to form new experiences.
An in-depth study of dozens of retailers showed those that are flourishing in this era of disruption share a common set of behaviours and practices.
We’ve distilled those into six key steps any retailer can follow to become an agile business that thrives on disruption:
1. Delight customers
The most successful retailers put their customers at the heart of everything they do. That’s not to say they try to do everything for everyone (that’s best left to Amazon). Rather, they differentiate themselves in their own categories by creating relevant experiences that align with their customers’ desires and core values. To do that, you need to know your customers and understand what motivates them, so you need new ways to collect and analyse data about them.
2. Be digital first
Winning retailers use digital properties to establish their brand promise and integrate it into their stores. That doesn’t mean abandoning bricks and mortar. It means rethinking the way you connect with consumers, and using digital channels as your first point of engagement to help you cultivate mutually beneficial relationships with them. To establish lasting digital connections, your content must be authentic, intriguing, shareable and useful.
3. Find your tribe
Know who your ideal customers are and foster a community around them. In a world of endless choices for consumers and competitors hungry for your business, you can’t be everything to everyone. You need to connect your brand to a way of life that resonates with your customers — by adding value to an existing community or building your own. Embracing digital channels is your route to success.
4. Be global early
Your tribe could consist of consumers anywhere in the world. You need to find them and be ready to compete against global brands. If you’re a smaller retailer, the objective will be to scale thoughtfully to reach your customers wherever they are. For a larger, established retailer, it will be a question of connecting with consumers globally in a more local, relevant way.
5. Foster an innovation mindset
To succeed in a volatile environment, you need to do more than simply roll out the latest tech or a bunch of new store concepts. You need to create a culture of creative thinking that rewards innovation. That means adopting a mindset that supports innovation: one that’s collaborative, open to change and new ideas, and excited to take risks.
6. Develop tech DNA
Retailers know they need to invest in technology to engage with consumers on digital channels, track operations, plan assortments and develop campaigns. What truly successful retailers are doing, however, is changing their culture from one that’s tech-enabled to one where technology is embedded into the organisation’s DNA. As well as using technology to connect all areas of their business, retailers use it to connect their brand to their customers — in store as well as online.
- If your organisation is ready to know more about how to thrive on disruption, check out Aptos’ Retail’s Change Manifesto. It’s full of practical guidance and real-world examples of retailers who are leading the way in this era of constant change.
Richard Willis is regional vice president international, solution consulting at Aptos
Willis is a seasoned retail technology professional who has worked with retailers for more than 25 years throughout Europe and globally. In his current role at Aptos, he supports retailers in their efforts to differentiate and innovate through the use of technology.