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"Resilience: A key success factor for the retail sector"

Excerpt: The (electronic) retail industry is in a constant state of flux and continues to change constantly as a result of various environmental factors that can hardly be influenced by the company itself. In order to be able to adapt to this changing environment in the long term, "resilience" is a necessary corporate characteristic.

It is often said that the best business models are the most resilient. But what actually leads to resilience in business? According to Ron Willingham, author of Integrity Selling for the 21st Century, resilience is an indispensable trait for an enduringly consistent and seamless Customer Journey. It is the trait that enables companies to recover quickly from challenging environmental factors during tough times. These environmental factors can be political-legal, economic, technological or social. This macro-environment has a significant impact on the development of a company, but conversely can be influenced only very little or not at all by the company.

„Organizations need to reimagine both the workforce and work design to be resilient — and to able to sense and respond to change, repeatedly and at scale.“

Source: Gartner, Jordan Bryan (2020)

Following up with the example of the Corona pandemic, this article explains how retail companies created resilience early on to remain competitive during this challenging time.

What impact did the pandemic have on the retail sector?

Without a doubt, the retail sector is one of the industries that was most affected by the pandemic. However, much of the retail sector had already adapted to digitization before the outbreak of the pandemic, which meant that this environmental factor acted more as an accelerator for many companies’ digitization projects. 

"70-80% of B2B decision makers prefer remote interactions or digital "self-service" over in-person interactions, citing easier scheduling, travel cost savings, and increased efficiency as the main reasons."

Source: McKinsey, Survey „German B2B decision maker response to COVID-19 Crisis“ (2020)

Companies that want to build strong and well-developed sales and logistics management need to develop their eCommerce platforms and reach their customers personally. This is where Product Information Management (PIM) comes into place. To build an end-to-end customer-centric business model, relevant and consistent product information must be provided throughout the value chain. A PIM system helps companies complete, enrich, and customize product data and distribute it to the right channels for different stakeholders. A PIM system thus ensures that product information is retrieved platform-specifically and almost in real time, so that even small and medium-sized manufacturers and retailers can hold their own against large corporations such as Amazon, ebay, Otto and co. 

Digitization is increasingly making physical contact in retail obsolete, and we as shoppers expect our orders to arrive within hours or our questions to be answered in seconds. We have also entered the age of “contactless” shopping, which is changing customer behavior in a groundbreaking way. Companies that want to keep up with the current digital changes need to consider resilience and adaptability as priority capabilities for their business model.

How can PIM provide assurance to merchants?

Even if the topic of “digitization” was only a “nice to have” or had a “booster” function for some market players before the pandemic, it is now the be-all and end-all for companies – across industries and departments, along the entire value chain.

"According to a survey, the most popular digital project already underway to maintain operational stability is accelerating digital transformation. The focus is on centralization and thus combating data silos. Nearly two-thirds of respondents said a project with this target intention is already in progress. In addition, nearly 30 percent of respondents plan to implement such a project in the near future."

Source: Statista, Digital Transformation of Business Services (2020)

Retail companies have complex working environments, characterized by different information processes (RFI, REFQ, RFP, etc.). Manual processing of existing product data in silos and Excel sheets therefore leads to deficiencies and inconsistent structures compared to processing with PIM software. In order to facilitate customers’ purchasing decisions through customized or specific recommendations, the responsibility of manufacturers and distributors is increasing with the various types and countless quantities of products and their spare parts. Thus, a well-designed digital product catalog equipped with consistent product data becomes the most important tool for retailers. Product information management software provides the ability to manage this product data, including all relevant attributes, in a single data source to strengthen the company’s overall data structure.

The benefit of PIM for retailers

  • Better informed customers: Customers access accurate and up-to-date product information that enables better purchase decisions. In this context, rich product information also significantly improves conversion rates while reducing return rates.
  • Shorter buying processes: Personalized navigation through the entire product range, online assistants, contactless offerings such as self-service checkouts or online payment systems, will encourage customers to shop regardless of time and place.
  • Improved customer experience: Improved visibility in search engines and marketplaces, personalized offers, and fast processing of customer inquiries about products, provide a better customer experience along the customer journey. Relevant product recommendations also fully exploit cross-selling and upselling potential.
  • Superior Omnichannel Experience: PIM enables retailers to deliver a consistent omnichannel experience, providing product accessibility across any channel, platform, and device. Digital media such as images, videos, or 3D visualizations are also delivered in the right format for each channel. 
  • Increased customer confidence: In times of pandemic, building customer trust has been a major challenge as customer interactions happen online and without physical interaction. Therefore, product content is the most important thing to build trust. Providing current inventory numbers or shipping and delivery times for the product are as important as the product and its description itself.

A PIM system is the most important tool for retailers seeking shorter time-to-market and a consistently seamless product experience by improving their product data. But which software model is best suited for a retail company? 

On-Premise PIM

“On-Premise PIM” is the software model that is physically located on-site, purchased under a license, and maintained, stored and managed on the company’s servers. This allows the retailer to take full responsibility for maintaining and integrating the data themselves. 

Cloud PIM

“Cloud PIM” is a software model that requires no installation or deployment. It contains the PIM software in the cloud, hosted off-site by the provider. More importantly, it not only saves integration costs, but also provides greater resilience. With their customizable and dynamic features, cloud PIM systems are more secure and preferable by retailers. 

If you have decided to start your PIM journey, our experts will be happy to support you in making your retail business resilient and future-proof. Feel free to contact us for a no-obligation online demo and learn about the benefits of our PIM system for your industry and business model. If you are still not sure whether a PIM system will help your company, we also recommend our article “When do companies need a PIM system”. Here, various challenges from day-to-day business are described where a PIM system can provide concrete relief.

More articles:

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Was ist der Return of Experience Werden Sie zum ROX-Star!

What is the return of experience?

In addition to ROI (Return of Investment), ROX (Return of Experience) is a metric that should play a big role in e-commerce. Customer experience determines up-selling or cross-selling and also post-purchase reviews. The direct link between customer perception, customer experience and actual behavioral changes is quantified by ROX. The engagement of the employees in the service departments of the companies is also included in the consideration of the ROX. A PIM helps deliver the best quality data across all touchpoints.

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