Insights That Matter on Shifting to a Digital-First Mindset
A note from David Bassuk, Co-Lead of our Retail Practice:
It has been quite a year for the retail industry, with one disruption hitting after another and making profitability hard to come by. But retail is a resilient industry, and the smart retailer will take both internal challenges and external disruptions like inventory pileups, supply chain issues, inflation, and labor shortages head-on.
Amplifying these challenges is the consumer, who holds all the power and makes loyalty harder to come by than ever before. Today’s consumers are increasingly starting their buying journeys digitally – looking for reviews or product information, doing price comparisons, finding newer brands.
To meet these consumers where they are, we’ve been asking retailers to indulge in an interesting thought exercise: “What if you were an online business that happened to have stores and not a stores business that added on an online channel?”
This small but powerful shift in mindset—what we call Digital-First Retail—can completely change your way of working and unlock incremental value across every aspect of the business. I recently presented at WWD’s Apparel & Retail CEO Summit alongside my colleague Sonia Lapinsky to talk about this mindset change. And this was also a big topic of conversation at the Sourcing Journal Fall Summit, where my colleagues Murali Gokki and Ryan Poole spoke.
Below, we have some thought pieces and articles on ongoing disruptions and practical advice on how to tackle it. We hope you’ll find these useful as you plan for 2023.
Online. Offline. Bottom Line. The Philosophy of Digital - First Retail
Retailers continue to invest a lot to keep up with the omnichannel customer. But, for most, increased digital penetration is leading to shrinking profits—so their bottom lines stay right there, at the bottom. Until now.
To keep up, retailers must shift to a Digital-First mindset. This isn’t about more than “brick-and-mortar” vs. “e-commerce” or sales and marketing channels. It’s a shift in operating models, metrics, and processes to connect with consumers across all touchpoints. The challenge? Only 55% of retailers agree they have the right capabilities to interpret their data, and only 30% agree that they could better adapt their existing ways to utilize new technologies.
Fashion in Focus: New Norms and Paradigm Shifts
After a few turbulent years, the apparel industry is settling into a new normal that looks nothing like it did before. And with continued disruption now “expected”, in this second annual Fashion in Focus Survey Report with Sourcing Journal, we explore how equipped and prepared companies are to weather challenges and changes.
How are apparel brands engaging the digital generation? How many fashion companies still use Excel for planning? What is the industry really doing about sustainability? Explore the trends that are top of mind for the industry’s leaders and see how your company compares.
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Retailers can’t afford to wait for a cash crunch; here’s what to do now
Consumers in the U.S. have been resilient over the last few months with retail sales up 7.8%. High inflation is, however, wiping away any real increases for retailers and there are plenty of headwinds brewing. Most retailers are expecting revenue shortfalls compared to their original FY’22 business plans, which were more optimistic off the back of record sales in 2021.
In the face of an impending economic slowdown and potential liquidity crisis, delaying action is the worst tactic. Our retail consultants look at how smart retailers can prepare now.
Tales from the shop floor: How retailers can act in the face of recession
With double-digit inflation, rising borrowing costs, falling UK consumer demand sitting alongside the constant need to innovate, ESG concerns, and supply chain challenges, you could forgive retailers for feeling like the world is against them at present. In recent times consumer confidence has only been lower during the 2008 financial crisis and will likely worsen over the coming months.
So, given the tsunami of challenges facing the sector, what actions can UK retailers take now to weather this impending storm? Our retail team examine the winning formula dominating board room agendas at the moment – combining “Back to Basics” with the need for agility.
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