Next week, we’re going to be at IRX 2018. It’s the UK’s largest multichannel retail event. We’ve been before, spoke to a load of interesting people focused on driving their retail and e-commerce businesses forward and learned a lot. So we’re pretty excited to be heading there again. If you want to speak to us, we’re going to be at stand G64.
Ahead of the event, we’re anticipating the event's biggest talking points. These are some of the main concerns felt by retailers as they arm their businesses to deal with the rapidly evolving consumer landscape.
Scroll down for a digest of some of the stats underpinning the need for retailers to face change head-on, as well as our POV about how each of these developments impacts fulfilment.
Same-day deliveries are redefining the customer experience
Amazon, typically, has led the charge with 2-hour deliveries in urban areas. ASOS quickly followed suit last year with same-day deliveries in London, Leeds and Manchester. It isn’t a novelty. It’s the natural next step for speedy deliveries:
51% of speciality retailers say that they offer same-day delivery (Boston Retail Partners)
The same study revealed that 65% plan to have those capabilities within 2 years
56% of consumers between the ages of 18-34 expect same day delivery, with 61% willing to pay more for the service
20% of UK retailers are still unable to offer next day deliveries (YouGov)
80% of shoppers want same-day deliveries (Temando)
The demand is there, consumers are willing to pay more for it...the only barrier standing in the way of reaping the rewards is the ability to actually deliver.
The capabilities for same-day deliveries live and die in the warehouse. In order to turn this desire into a reality, a few things need to happen:
- Inventories need to be watertight
- Fulfilment needs to have supercharged speeds
- Carrier relationships need to be locked down and reliable
Speeding up fulfilment can happen with a two-pronged attack. Invest in proven physical automation that reduces time-wasting activities around the warehouse: this will free up warehouse staff's time to perform other, more valuable, functions. And have the right WMS in place so that there are no doubts about inventory fidelity and full confidence in your ability to prioritise same-day deliveries.
For more about the impact that automation will have on the majority of warehouses, download our latest whitepaper.
We’re living in a mobile-first world
Here are a few facts about mobile-first shopping:
41% of American consumers used smartphones for online shopping during the 2017 Black Friday Weekend (Consumer Technology Association)
UK citizens look at their devices more than a billion times a day (Deloitte, 2015)
Looking specifically at retail, mobile purchases overtook those completed on a desktop for the first time in Feb 2016 (IMRG)
The share of sales has only increased since then: 60% of all online sales completed between 6 am and 9 pm on Cyber Monday came from mobile shoppers (Campaign)
Spend on mobile devices is predicted to exceed £82bn in 2018 (Mobile Marketing)
Change isn’t a’coming, it’s already here. Creating directional, simple mobile experiences that encourage purchases on the first visit should be a major concern for all online sellers. Beyond continually honing UX, there’s a lot of buzz around taking advantage of what Google affectionately refers to as “micro-moments”; small windows where a consumer uses their smartphone to kill time. Leveraging these moments is seen as a significant stepping stone in creating a truly omnichannel retail experience.
But what about the warehouse? Mobile-first applies here, but in different ways. The core responsibilities of the warehouse (picking, packing, despatching) all happen on the ground. They’re carried out by people carrying around mobile devices. But, all too often, the design of the products being used isn’t led with a mobile-first mentality. It isn’t grounded in the practical reality of the jobs that need to be performed within the warehouse.
Mobile-first in the warehouse means that devices shouldn’t be reliant on the cloud, or on servers, to work. They should be able to communicate with each other without the fear of any external issues wreaking havoc. Mobile-first isn’t just a concern for your front-end; it should also be a major consideration for your back-end.
Personalisation isn't an option
The rallying cry of personalisation being king has been ringing out for a while now. As more and more retailers get clued up to effective personalisation tactics, the need to adapt is now more urgent than ever. Here’s why:
75% of consumers are more willing to shop with a company that recognises them by name, recommends options based on past purchases or knows their purchase history (Accenture)
74% of customers feel frustrated when website content is not personalised (Infosys)
Over 78% of consumers will only engage offers if they have been personalised to their previous engagements with the brand (Marketo)
60% of consumers are comfortable having their shopping interests and behaviours used by retailers if it expedites their online shopping experience (Magnetic/ MyBuys)
77% of consumers have chosen, recommended, or paid more for a brand that provides a personalized service or experience (Forrester)
Personalisation in the front-end is one thing. Extending this to the back-end, to incorporate customers’ specific requirements within each delivery, is another. This is particularly the case if your warehouse is dropshipping for another company, or if you work in B2B retail and e-commerce.
When dropshipping, you’re dealing with different companies’ brands. You need to make sure that the end consumer receives the right information and documentation; this is crucial to their overall brand experience. The details needed for each company will vary wildly. It’s important to have systems in place that automatically know what needs to be printed for each package to ensure that human errors don’t slip through the net.
B2B retail and e-commerce is even more complex. B2B businesses need to have intelligent websites that offer different permission levels, display custom catalogues and allow for easy re-ordering to really bolster their value proposition. And their warehouses need to be able to print off the right branded documents, will all of the relevant information, on demand. This is where a WMS becomes invaluable. Read more about the challenges faced by B2B companies in this blog.
Is it possible to compete with Amazon?
Amazon’s the name on everyone’s lips. Is it possible to compete with them? Does it make sense to work with them? Here are some of the stats driving the conversation:
10% of consumers now shop exclusively with Amazon (PWC)
18% of consumers shop less often at other companies’ websites because of Amazon (PWC)
Amazon held 43.5% market share of online sales in the US in 2017 (eMarketer)
Amazon has the biggest market share of UK online sales at 16%; Tesco trails in second at 9% (IMRG)
1 in 4 US citizens has Amazon Prime (Bloomberg)
Clearly, its market dominance is only going to increase. Its innovations will continue to drive up consumer expectations. E-commerce leaders are feeling a very real pressure to keep up.
Companies can’t compete on Amazon’s product range, nor on its convenience. So the temptation is to join their FBA (Fulfilment by Amazon) program to have their products available for Prime delivery. But not everybody wants to do this. A large swathe of retail and e-commerce leaders want to remain in control of the brands that they have worked so hard to build up.
So they need to be able to compete on speed. Again, this will involve having the right technology on side. For another view on automation, take a look at this blog; it should put you in the right mindset to work out what changes you need to make in your warehouse.
It’s important to remember that not everything’s going to be smooth sailing for Amazon either. There’s a problem with Prime; read our CEO Jonathan Bellwood’s blog about it here.
IRX 2018 is set to be a really positive event. If you’re there, come and find us at G64. We want to hear about the problems that your business is going through, learn about how you’ve overcome obstacles and gain a clearer view of the current supply chain landscape.