In a Digital, Omnichannel World, Inventory Remains King
As consumers, we all love a good bargain. That’s why Black Friday and, more recently, Cyber Monday have become such huge shopping events during the holiday season. It’s all about the discounts. Or is it?
After all, does the size of the savings really matter if you can’t get your hand on the product? Are customers who brave the crowds or spend their time clicking through an online purchase ok with a “rain check” or the digital equivalent of one – a later delivery date? The simple answer is no.
Consumers today have far more power than they did a generation ago when shoppers would go to a store and roll the dice as to whether the product would be on the shelf or out-of-stock. Today’s consumers expect more – more insight into the availability of a product, more options when it comes to buying that product and more flexibility about how and when they take possession of the product.
For retailers, this has become the new normal – they need to unify commerce across channels— be it inventory, customer history, or delivery options. Today’s consumers expect retailers to merge physical and digital shopping experiences and the key to keeping them happy keeps coming back to inventory.
Real-time Inventory Tracking
According to a survey of retailers conducted by Manhattan Associates, only three percent of U.S. retailers say that have an accurate view of the inventory across their entire business – that’s in-store and online – 100 percent of the time. Compare that to the 26 percent of consumers who expect retailers to be able to check availability elsewhere, including online, or the 15 percent who expect the retailer to fulfill the order for home delivery when it’s not available in the store.
Those numbers will only continue to grow among consumers. But with such a small percentage of retailers able to provide that level of insight, the disconnect between the type of information consumers want and what the retailer can realistically offer will only continue to widen.
In addition, 80 percent of U.S. consumers have done some sort of homework online about a product before going into the store to make a purchase and they don’t want to waste their time traveling to a store only to find an empty shelf.
Disconnect between the type of information consumers want and what the retailer can realistically offer will only continue to widen. Retailers don’t have real-time insight into the network-wide inventory at any given moment.
Consumer Demands Keep Growing
Prioritizing Retail Investments
Consumers want control – hence the long-standing customer-is-always-right mentality – but the amount of control they want has increased. Today, they don’t just want visibility of the in-store stock but also over last-mile delivery – that is, when the product will be delivered, how much that delivery will cost, and which carrier will deliver it.
It's only a matter of time before consumers start measuring delivery time satisfaction by the hours, rather than the days.
And that brings us back to our original premise that consumers love a good bargain.
If there is no sense of urgency and the customer is motivated by pricing rather than timing, then retailers can have some flexibility in how they manage their inventory. For the right price, consumers might be willing to wait for the product, which then can be shipped directly from a distribution warehouse or even a physical store in a different part of the country that has an abundance of that product.
Sounds easy, right? But if retailers don’t have real-time insight into the inventory at any given moment, can they really deliver on the promise to give consumers what they want, when they want and at a price point that will recognize the urgency or delay?
As per the survey, nearly a quarter (22 percent) of U.S. retailers agreed that enabling a single view of network-wide inventory in real-time was a top priority. Meanwhile, nearly the same share are prioritizing customer service solutions (25 percent), creating more sustainable and environmentally-aware supply chains (27 percent) and enhancing shop fulfillment capabilities (22 percent).
The challenge, of course, is that none of these priorities work in a silo. Retailers are juggling myriad priorities – worthwhile, valiant ones – all at once. These take time, investment and they must work together so that the underlying technology is robust enough to handle the changing demands of the consumer of the future.
That doesn’t mean retailers need to anticipate every changing consumer demand. Instead, it means that they need the technology that will enable them to pivot quickly to meet those changing demands, to help keep them competitive and help them stay in business.
The simple truth is: If they break their promises to their customers, eventually their customers will look elsewhere to get what they need.