Retail Dude

Modern Retailers are totally IT dependent. No doubt that IT has helped Retailers to control their operations efficiently and reduce cost but it has few drawbacks too. Retailers become helpless when their IT system fails no matter whether it is a virus attack, software bug or a hardware breakdown. In spite of precaution and preventive measures which Retailers might have taken to avoid these, they are bound to happen sometime or other. And whenever they happen, it causes risk to their most valuable digital asset – ‘’Data’’.

Retailers now a day’s operate round the clock and take care of minute things due to competition but they put their productivity as well as profitability in stale by not taking adequate measure to back up and protect their data. A study revealed that almost 2/3^rd of the retailers takes a day or more to recover data due to system failure. Just imagine a scenario where a retailer is not able to access the data for last 24 hrs:

• No record of what sold in last 24 hrs.
• Stock matching cannot be done.
• No idea of what to order to keep shelves full.
• Record of new customer added to customer database for the day lost.
• Customer queries etc. for the day lost which will cause dissatisfaction to customers.
• Records of CRM and Loyalty program for the day at stake.
• Sales based incentives of employees for the day lost.
• Cannot verify cash.
• Details of the goods returned by customers lost.

Many retailers back up their servers at HO and also take regular backups. Servers are the lifeline of IT infrastructure and it’s necessary to ensure that they are safe and backed up. But still a large chunk of retailers do back up manually on even don’t do at all! Not all data which an employee is working on is on network as they keep them loosely on desktop and work on them even when they are away from network. As per an estimate almost 60% of organizations data are on workstation and not on their servers. Thus retailers need to ensure that both servers as well as workstations are backed-up automatically.

Frequency of Back-up:

How often retailers backs up data is again an important factor. Though most of the retailers back up every day end of the day, many even wait till end of the week which is suicidal. Greater the frequency lesser will be the loss from such disasters. A safer approach is to have automatic back up few times a day.

Test your DR (Disaster Recovery) Strategy:

Having regular successful back-ups and structured DR Strategy makes Retailers confident that they will be able to recover their data. But majority of retailers don’t even test there DR Strategy once a year also. Retailers need to understand that if they don’t test it regularly than it might not work when actually required, putting all efforts in vain and will put all their data on stake causing huge losses. To be on safer side, they should test their DR strategy quarterly.

Off late, loss of data has become a primary concern for retailers and has significant implication on their finance and productivity. A bad DR Strategy can challenge business continuity of the Retailers whereas a sound one can minimize the risk from such disaster.

- Rajeev Damani

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A close look at the technology, which we believe is going to be the choice of a lot of leading retailers. Microsoft has released a new technology called “Surface” which would enable retailers to have virtual showrooms hosted on there display tables, allowing customers the browse and customize options. Have a look!

Original Video: http://www.youtube.com/watch?v=D1IpDStL23M&feature=related#watch-main-area

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The “I” is now synonymous with the retailers, having accepted the change needed in the hour to “Integrate” processes of the business with “Information” technology.  With the increase in the scale of operations of retailers and the globalization of the whole business, Indian retail could only bank upon Information technology to come to its rescue. From the point of sale to the point of supply, the seamless working can only take place with the IT bone in place. However it’s the, retailers who must make sound decisions supported by a rigorous business case that delivers quantitative benefits far greater than the costs with the multiple technologies in place right from RFID’s, touch screens, smart shopping carts to interactive consumer consoles.

Most of the retail operations in functionality are complex and highly customized to the format or the chain itself. The high degree of product complexity, supply chain dilemmas all along with the multiple touch points that retail face (manufacturing, C&F, distributors, retail outlets and the customer himself) calls for an integration which can only be process driven through systems. But in reality retailers who do not manage the IT systems effectively will find that this becomes the pain point more than the alleviation of it. IT networks effectively impacts the cost of goods sold, through better management of critical processes like inventory management, supply chain management and to an extent merchandising activity. We all agree that retail scope varies across geographies even within the same borders. The only way to address this variability will be to track, measure and implement the optimum products at the right places. We cannot imagine doing that effectively today without information systems in place.

There will also remain a need to maintain a proper data architecture since many a decisions are accumulated from past records ie the measure of a given sales scheme or a particular seasonal discount in the past years that was successful. Some of the most critical decisions based on data warehousing will be forecasting of trends. Our new mantra of customer centric retail is unfinished without a CRM database for that matter. A strong base of customers is what all retailers look for; and in fact the Govt felt the need of a “Do Not Disturb” policy for the telecom products. Effective use of such databases for service retail is essential, although having such a huge database of customers is nothing short of a goliath act.

Retail analytics is one of the emerging fields to conceptualization of the business from scratch to its improvements, mainly a field based on numbers and its dynamics. Most large chains of the world like Wal-Mart, Tesco, Sears and likes had set up back offices way back into early 2000’s just to support their sourcing activities in India and now slowly foraying into their front ends once when their system architecture is now robust enough to compete. ERP’s have now become a necessity to most retailers than just a showcase for better and effective management, since the prominent retailers now have a vertical integration of their products. Life is surely made easier even when your products are outsourced. Optimization can only be achieved when you can track real time. RFID’s the next gen technology can only lead to smarter supply chain and inventory management. Touted as the revolution, we have previously seen what a smart store connected to your kitchen can do. The only dampener which is the cost will surely see a reduction in future.

The cost of implementation of IT structure as said earlier has to prove its mettle and managed properly. The initial set up cost is certainly high, which reduces over time as we head towards a more profitable business reaping its benefits. Other challenges in the IT landscape would be to manage the lack of standards to move to a universal platform or towards highly customized solutions which escalates cost. This is a double edged sword to walk for the sector. However to talk of its intangible benefits, the knowhow of an advanced retail solution can be relevant to the retailer’s long-term strategy and competitive positioning. Some of the mentionable aspects would be the brand perception (by using cutting edge technology to stay up beat), to a more brand evangelist and heightened brand or store experience for its customers.

So to say, that IT can support the strategic decisions, the operational moves and the customer interfaces is only a pool to be dived into. Certainly the way ahead will be to re integrate the IT structure itself from the customer POS to the back end supports. We could productively see spends on the store itself being the hallmark of a customer experience and also the point of customer delight. We could see more value added services like Mobile POS and intelligent systems which identify the store loyalists in an informed world.

To keep up to the shifting consumer spending patterns and trends, IT is definitely IN.

 Cheers!

Sudip

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Apple’s new iPod shuffle is smaller than a AA battery, and can store 1000 songs. The small has just gotten smaller, and they have achieved so by removing all the controls from the main players body and moving it to the ear buds itself, which it refers to as an in-line technology. Another attractive feature of the newly introduced shuffle is the “Voice Over” feature, as it turns out, the new shuffle was too small to hold a display screen, so the new shuffle will now speak to its users, it can announce the name of the songs currently playing song, the album name, the artist name, and it can even read out your playlist name, so that a user can easily switch into different options. Although a lot was expected from Apple for its new 3rd generation shuffle, and critics have taken a low down on the new launch, I would still suggest that Apple can still take us for a ride.

Check out the new Apple Shuffle: http://www.apple.com/ipodshuffle/

Hope it gives some new reasons to retail stores to sustain themselves ;-) 

- Sarthak

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So it’s about touch point, about reaching customers, about giving them information with experience and in return collecting information of customer to ensure future communication’s standard and again a good experience in that for the customer & it’s also about conversion rate, about an appeal to a potential customer to become a customer. In this tech. and digital age retailers have lots many tools that they can use to enhance customer experience and can increase their reach. But when, which and why they should use these tools is totally dependent on their requirements and return on investments. So I am not going to provide any guide on how to approach these tools but instead going to introduce a new touch point for the retailers which can be beneficial for their business. The tool named mobile and cellular marketing(also involved interactive marketing), which were there for some time now and retailers were using them partially like sending text message alerts , using bluetooth to send new offerings and offers etc., but with the launch of iPhone (touch and 3G) boundaries seems to be limitless. But now you wonder whats their in iPhone for a retailer. So some facts and figures for you -   Apple surpassed a number of  12 million as far as its sales in 2008 was concerned and this surpasses the expectations of apple who decided to achieve a mark of  10 million as a sales for 2008. This growth is coupled with 93 percent of iPhone owners who have added an application, it is clear that brands have a new and powerful marketing channel that they should embrace, as this will provide them a base of 10+ million potential customers whom they can reach with only one application in iPhone. There are thousands of applications in Apple’s Appstore and more and more are added daily. Some retailers already taken a step of initiation and launched their application for iPhone, to name some are – Amazon, Target, Gap and Sam’s club and many more on their way to do so.

Now the question is what kind of application a retailer is supposed to develop for an iphone. So a retailer can opt for an application with features like –  

1.        Get location of a nearest store even direction to reach there (using iPhone’s GPS), or call the store directly.

2.       Get a Detailed catalog of products and services as well as hours of service for a store.

3.       Get an update on offers/schemes/events etc.

4.       Promote products and use apps as a channel of marketing.

5.       Capture details of customer for CRM/Database.

6.       Food retailers/QSR/restaurants can get order from iPhone and get the food ready while the customer arrives. This will reduce delivery time a lot.

7.       Fun filled apps mostly seasonal and used to promote specific products

Apart from this there is no limit of how creative you can become in terms of application.

So far I talked about iPhone applications but as more and more smartphones are venturing into market the same principle can be applied albeit with a different feature set,  as Research In Motion launches the BlackBerry Application Storefront and Application Center, and Google’s Android gains wider adoption, also Nokia is planning to launch its music and application store this year. So this new medium should be leveraged as this involves less investment and greater returns plus reach - a digital touch point for retailers.

-Prateek Katiyar

P.S. - Readers are invited to

• Give viewpoint on “Whats there in digital touchpoint for Indian retailers”.
• Provide ideas for applications you want to see from your favorite retailers(Indian+global).

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Before proceeding to the main topic let me build up some context. I will first of all like to define what touch point means for a retailer.  Actually touch points are the instances of interactions between retailer and customer/potential customer. But take these interactions into broader meaning, because in retail if a window display attracts a customer to a store, this eventually comes under an interaction. So keeping retail business in mind I categorized these touch points in two broad categories –

1.       Active touch Points

2.       Passive touch points

Now the active touch points are those where a retailer/associate/customer facing group has a face-to-face/phone/email interaction. But a passive touch point includes advertisement/windows display/store atmosphere/word of mouth etc but these also have equal amount of influence on customer as compared to active touch points. Further these two touch points can be divided into “Managed touch points” like store atmospheres and the customer facing group these things a retailer can managed according his own wish and can also manipulate things , but there are some “Non-managed touch points” like word of mouth on which the retail don’t have any control.

But now in this era of technology one more dimension has been added to the touch points for the retailers. Now we can classify touch points for the retailers into –

1.       Traditional touch points

2.       Digital touch points

Traditional touch points are the touch points which include store display ambience etc, customer facing group, and TV/banners/Radio advertisements. But the digital touch points are those which involve websites/email/mobile SMS/MMS or Mobile applications.

Internet is here for many years now and maximum retailers now know the potential of web and are using it as a good touch point for their customers. This not only increases the reach of a retailer but also facilitates customers in many ways most prominent of them is convenience and time. But with the evolution of smartphones and the launch of much talked and promoted iphone this interaction/touch point reached a new height about which I will talk in my next post till then happy reading guyzz ………

-Prateek Katiyar

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Ever thought about spending a penny to save a Rupee.  

Sounds a great proposition, especially when recession is on upward swing & markets are hitting rock bottom.  So as our oldies said, money saved is money earned holds particularly true in today’s scenario, when cost cutting is the new mantra. 

So, to untangle one from the clutches of recession, a new service is launched, moneysaver, brainchild of 2 young entrepreneurs, Kunal Bahl & Rohit Bansal, who aspired to make every brand affordable for everyone by offering hundreds of discount coupons & buy  one get one free coupons on branded apparels, fine dining, casual dining, movies, entertainment etc.  

Moneysaver is a service that comes in handy to consumers as its affordable (Just Rs 100 monthly), accessible (Just a sms away), Available (More than 200 outlets where one can buy moneysaver recharge card.) & every month, subscribers are kept abreast with the latest offers through monthly catalogue. 

The entire model is based on the simple fact that everyone loves to strike a deal, to make a bargain and avail a discount. The research which their focus group discussions revealed was that Indian customers are not price sensitive, they are value sensitive. The perceive value not on the basis of whether they are getting the product cheap but if they are getting it cheaper. Money Saver stretches the concept to make it a win-win for all by feeding on ’dependencies’. Aiming to reach a target group of 15 million potential booklet buyers comprising young professionals, college students and housewives they know that this is exactly the same group that the expanding pool of retailers is trying to reach across the country. There website called www.moneysaver.in is full of such great offers.

Not only Moneysaver, but other companies are also trying to utilize SMS, Bluetooth, mobile websites, to cost effectively reach customers.  Bluetooth companies such as Telebrahma and CellMagix have been promoting offers and content to consumers inside malls, by sending information directly to Bluetooth activated phones.

(Guest Post)

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IBM Retail Store Solutions has been declared winner of the 2008 Point of Sale Green Excellence of the Year award for its SurePOS 700 series of point of sale systems from Frost and Sullivan. This showcases IBM’s outstanding efforts in energy conservation and safeguarding natural resources. SurePOS 700 system is powered by high-performance; energy-efficient processors that help customers reduce system energy consumption by nearly 36 percent.

-       Rajeev Damani

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Price optimization in general mean pricing you product in an optimized way so as to retain customers as well as increase bottom lines.

Pricing is a very important function of Retail. Right pricing can fetch you strong and loyal customer base. With increasing competition in retail space, rising real estate costs and rising fuel prices, it has become more critical than ever. As competition is increasing, now consumers have more options to explore and make the best deals and stretch their dollars. With Real Estate prices shooting up, fixed costs are increasing for retailers whereas Fuel Prices are increasing the logistic cost. So, all these factors are contributing to higher prices which repel customers and result into losses. So in order to be successful we need to optimize our price keeping in mind all the variables affecting it including competition. This will ensure that we retain and grow our customer base. Moreover we need to consider various variables which affect the demand of the products too while pricing (we all know law of demand and its relation with pricing). These variables are seasonality, price elasticity, cross-elasticity between items, and inventory presentation.

In an organized retail chain with number of categories, and so many variables attached to pricing, it is really difficult to manage price optimization. Each variable affects price in its own way. So, retailers need an efficient pricing approach which is customer centric, margin maximizing, competitive and which optimizes prices at SKU level across the categories. The pricing strategy must be long term and must be implemented keeping in mind the product life cycle.

To manage this complex function, we have good price optimization applications available in the market.

- Rajeev Damani

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Although this post strays away from the focus of this blog, but I could not resist the temptation of posting this information. For this is something I had always anticipated, and now its taking a real shape. Google, in a few hours from now, is slated to launch a all new web browser, written completely from the scratch, with a brand new java support, faster and better - Google Chrome!

It was with the emergence of websites like Facebook, MySpace and then gMail which made me realise that, Web is not all about serving information anymore! and its fast turning into the concept of “Service as a application”, Some blogs has speculated about Web Browsers to be replacing OS’s in the future, and I think Google Chrome is just a step closer to this speculation. I will not deviate much from the core of this blog, Here are a few links for catching up with the heat! 

Google Comic Strip for Google Chrome Launch:

http://www.google.com/googlebooks/chrome/

Speculated Google Chrome Launch URL’s:

http://www.google.com/chrome

http://gears.google.com/chrome/?hl=en

- Sarthak

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