From NRF 2019: Personalized Fulfillment’s Role in the New Retail Customer Experience
January 31, 2019 by Omar Akilah
In January, the NRF Big Show kicked off in New York City. 30,000 attendees, including global retailers, industry pundits, and vendors from all over the world came to hear insights from the intersection of retail and technology. Now that the dust has settled on the main stage and I’ve had time to internalize all the incredible content and learnings, one thing is clear: It’s all about new retail’s customer experience.
On day 1, Sucharita Kodali, VP & Principal Analyst at Forrester stressed the importance of integrating inventory and customer location early in the funnel to improve the new retail customer experience and influence buying. She highlighted features such as buy online and pick up in store (BOPUS) and same day delivery — shown as early as on the product details page — are now table stakes for retail. Target was showcased for their ability to pivot and offer immersive omnichannel capabilities blending online and store experiences. The big question is how? Amazon and Walmart, with vertically integrated technology stacks, are able to test new features that influence the customer experience, A/B test, and continuously evolve. Target is also capable in this space, but like many other brick and mortar retailers, had an IT landscape full of packaged solutions that didn’t do the trick. They solved this issue by externalizing inventory, availability, & promising, similarly to Petco. The common theme: technology has to enable the new retail business strategy vs. hinder it. In this case, intelligence is required to determine where inventory is and how much is available to sell relative to where customers are. This isn’t as easy as you might think. Retailers must be hyper-focused on local inventory availability and customer location intelligence as the foundational building block to converting more sales in new retail.
On day 2, we heard Brian Cornell, CEO of Target, highlighting the 4 keys of success in new retail and they are customers, stores, technology, and — you guessed it — fulfillment. He shared the aggressive investments they’re making to regain their leadership position by leveraging their store assets to deliver the new retail experience. Here, stores function not only as physical retail locations but also as fulfillment centers. As a previous leader of the Target Transformation Team, available to promise (ATP), I will tell you that Target was able to accelerate their transformation by migrating from an ecosystem of IT packaged solutions to highly performant, flexible, and extensible technology solutions. This allowed their IT group to support their growth and realize the business strategies highlighted by Brian. What about everyone else? Well, I’m convinced retailers of all sizes can answer the call of the new consumer — and it isn’t to throw away what you have and start over — it’s to augment your solutions with the right technologies. Fulfillment is the fourth leg of the stool in new retail alongside brand, product/assortment, and price, and should have its own technology stack that drives the features and capabilities retailers need to offer their customers.
In summary, to influence buying and transform your experiences, key fulfillment features (e.g., BOPUS, ship from store, same day delivery, etc.) should be weaponized and used as differentiators. Knowing where your customer is and how you can best serve them (with your current assets and capabilities) is critical. This can be difficult given the use of traditional packaged software and the need to blend in-store and digital experiences required for new retail. The new retail experience is one that needs to be fast and convenient, and it needs to be customer-centric — a concept we call personalized fulfillment. This is a new concept and technology platform that enables retailers to provide the new retail customer experience and execute business strategies to improve and influence customer behavior (i.e., more clicks of the buy button). At NRF, we finally heard retailers and analysts alike stress the importance of making personalized fulfillment table stakes in the new retail experience. Without a focus on enabling it, today’s shoppers will simply buy elsewhere.Amazon,ATP,Available to Promise,BOPUS,e-commerce,Inventory Optimization,National Retail Federation,New Retail,NRF,Personalized Fulfillment,petco,Retail,Walmart