What can 2011 teach retailers for next year?
We may not yet be into the busiest days of Christmas the busiest time of the year in retail. But the UK retail sector has a lot resting on 2012 and is in dire need of a boost. Karmesh Vaswani, retail IT consulting head, highlights key trends retailers should consider next year to support commercial success
We may not yet be into the busiest days of Christmas – the busiest time of the year in retail. But the UK retail sector has a lot resting on 2012 and is in dire need of a boost. Karmesh Vaswani, retail IT consulting head, highlights key trends retailers should consider next year to support commercial success
Currently, there are 23,000 less retail jobs in the UK than this time last year, and average sales volumes have seen just 0.6 per cent growth in September 2011 compared with 2.2 per cent in 2010. To compound matters further, internet-based companies such as Apple, Google, Facebook and Amazon, are starting to take advantage of their physical-world connections to outpace competitors still using a traditional retail models.
Here, Karmesh Vaswani, vice president and head of retail, consumer packaged goods (CPG) and logistics in Europe at Infosys, highlights four trends.
M-commerce powered by mind reading
“Four million Apple iPhone 4Ss were sold during the weekend of its launch – a clear sign that the smartphone revolution is here to stay,” he said. “In 2012, retailers must adopt a more unified approach to their multichannel strategy, ensuring customers can access the deals normally found online or in store, direct from their mobiles; at their own convenience and disposition. At the same time, we will see a growth in consumers giving trusted retailers access to their preferences on social media sites and their locations linked to GPS capabilities on the mobile. Retailers must take advantage of this two-way communication in order to build a truly mobile engagement model.”
Consumers won’t be caught without their sledges this year
January 2011 hit the UK with the heaviest snowfalls for 30 years, costing approximately £14.5 billion in lost business over just three weeks. The weather caused havoc, disrupting supply chains and leaving retailers scrambling for goods. “With similar weather predicted for 2012, retailers must act now to protect their offerings by adopting ‘action-based’ business intelligence – collecting real time information from trusted sources to continually update their supply chains,” Vaswani said. “By ensuring the supply chain is flexible and using a network of multiple suppliers retailers can put themselves in a strong position to cope with freak weather.”
Emerging economies as prime customer markets
“The ‘BRIC’ countries [Brazil, Russia, India and China] represent 40% of the world’s population,” he continued. “Their importance in global economical forums has grown over the past ten years and shows no sign of slowing in 2012. This population represents a predominantly untapped market for UK retailers and 2012 will see it become priority targets for many.” However, he said they can’t afford to take a ‘one size fits all’ approach as these markets hide multifaceted diversities, such as local dialects, regulations and various established competitors. “To tackle this complexity, retailers in the UK will turn to new technologies, such as cloud computing, to efficiently rollout scalable global IT infrastructures to these new markets,” he advised. “Cloud models can be easily established, even in countries with limited IT infrastructures, as well as be tailored to meet local regulatory and compliance rules.”
2012: boom or bust for the retail sector?
With unemployment at 2.57 million and Europe’s struggling economy firmly in the headlines, 2012 will inevitably bring challenges for the UK’s retail sector. However, Vaswani concludes on a positive note, saying signs that 2012 will be a good year for retailers are also evident. “The 2012 Olympics for example is already boosting the UK economy,” he added. “For example, the recently opened Westfield shopping centre, which was built close to the Olympic grounds in Stratford, has already created 38,000 jobs. By improving accessibility to customers across multiple channels, simplifying complex supply chains and adopting ‘smarter technologies’ on a global scale, the industry can seize the opportunities 2012 has to offer.”