Why Faster Time to Market is the Ultimate Retail Differentiator
At the forefront of evolving customer expectations, the retail industry has weathered several waves of disruption. Retailers have been quick to adopt digital, setting the ball rolling on customer centricity. They were also the ones to brace-up for a pandemic no one saw coming and keep up inventories and essentials despite never-seen-before turmoil. What kept them going, helping them pivot to the next goal every time the paradigm shifted? It was the ability to deliver in the shortest possible time.
This holds true for globally spread supply chains shifting inventory between warehouses or delivering an order to a customer’s porch. For retail, the shortest way isn't only the fastest, it's also the simplest, easiest and most rewarding.
With the fastest time to market as a driving force, retailers — much like many players in other industries — pay attention to what works. This shifts the focus to streamlining internal processes (e.g., procurement, manufacturing, warehousing, in-store retailing, deliveries), which in turn leads to greater collaboration for a more seamless factory-to-the-front-porch journey.
This is why simply delivering on customer needs is no longer a differentiator. Retailers need to deliver on them in record time. Here’s why two-day deliveries have shrunk to two hours, which have provided leading retailers — both online and in-store — the edge they have even in challenging COVID-19 times .
The faster-time-to-market mindset and execution encourages robust standards of procedures. It helps retailers institute resilience and develop better customer relationships that lead to incremental payoffs in the long run.
Being the First Isn't a Fluke
Let's admit, it's not only retailers that are moving fast; customers are too. The acceleration is not only in turnaround times, but also in the pace of change in customer behavior. This puts retail as an industry in a dizzying whirlwind — where retailers innovate, create demand for those innovations, and then take them to the market — all at breakneck speed. This is why Walmart, Target, and Amazon.com want to know our locations and how we like our coffees.
Therefore, being the first to launch isn't something that happens at a whim. It's a culture that retailers must be willing to adopt at scale, starting from how their systems and employees work, right down to how they choose to execute order fulfillment — be it in-person deliveries or buy online, pick up in-store (BOPIS).
Here's how the domino effect created by the first in line to adapt to the change enables retailers to stay ahead of the curve consistently:
- Helps prioritize offerings: Sometime early last year, retail clothing brands witnessed a spike in sales of tops, without a corresponding increase in the sales of pants or skirts. It took some time for them to realize this is the new work-from-home attire. Adapting to similar shifts in customer preferences will require retailers to re-allocate resources across supply chains to high-demand, high-impact offerings. This will ensure fast-moving goods and products stay in stock and can be delivered within record time frames. Customer data and behavioral patterns help a retailer create a product heatmap that facilitates demand forecasting or helps meet spikes.
- Directly impacts ROI: How about a drive-through for retail stores where orders are waiting to be picked up? Walmart is working toward one, with robots assembling the order and significantly reducing the time to fulfillment. Despite a high Capex, Walmart clocked over $500 billion in revenues in the 2020 fiscal year, leagues ahead of Amazon. When retailers drive strategic investments on initiatives that speed up time to market, the returns bump up. This creates a virtuous cycle where retailers invest in tools and technologies, human resources, and augmented, automated supply chains to cater to customer needs for near-instant gratification. All of which, in turn, helps retailers work with aggressive timelines to meet customer expectations.
- Influences market share: We all know Amazon's Kindle as the game-changer device for e-books. But very few hands would go up if asked about Sony's Reader. This is despite the Kindle trailing the Reader by a good 14 months way back in 2007. The reason? As per the Harvard Business Review, Sony operated in silos and didn't enlist the publishing industry as an ally. Amazon, on the other hand, with its rather lesser technologically advanced in comparison Kindle, sought out publications, and the rest is history. When retailers want to push products to the market faster, they turn to partnerships and transcend traditional business boundaries. This helps them play to their strengths while fostering an ecosystem that works together to make the product a success. The impetus for faster time to market then leads to a higher market share as factors driving momentum for the product multiply.
- Enables faster growth: In a bid to take products faster to market, retailers have to join forces with logistics companies, manufacturing firms, even government regulatory bodies. The world has long gone flat — i.e., taking a product from one geographical location to another within record timelines is now an expected norm. Pulling this off calls for strategic cross-border partnerships. The crucial aspect here is when retailers chase faster time to market, they also see faster growth. As they put customers first, they make strategic business decisions and forge allies that enable them to execute order fulfilment seamlessly. This, in turn, unlocks potential growth opportunities that take them beyond the business models or locations they began with.
- Facilitates curated selling: As is evident, leading retailers don't do different things; they do things differently. They anticipate imminent needs, cut down cycle times, and ensure customer satisfaction by delivering orders in record time. However, all of this would seem herculean if not backed by data. Retailers that develop insights into customer behavior and drive hyperpersonalized offers continue to maintain the market edge. Customer segmentation is now becoming highly individualized, triggering a move away from broader-strokes marketing to focused, personalized recommendations. Knowing what a customer wants is key to delivering it faster.
In Conclusion: The Early Birds Rule the Roost
It goes without saying, Amazon's muscle power or Walmart's ingenuity don't come easy or cheap. However, the rules by which these behemoths play the game are the same. They prioritize customers and make it easier, enriching, and more meaningful for them to buy things. And that's how they rule.
The invisible hand at work here is data and the myriad ways it comes into play. The faster time to market as a differentiator is an old one (albeit a few years old), but it keeps retailers in the game. Speed is the new deciding factor for success. If retailers work with agility while servicing customers, as well as build nimble supply chains, they make the cut easily.
Understandably, every retailer may not have the expertise or tools to channelize inbound, first-level data into something that can help envision the customer archetype. This is where strategic data management partners come into play — those that understand the intricacies of geographically spread supply chains and can read the trends that influence customer behaviors. All of this needs to be overlaid with an understanding of how retail works — e.g., how inventory is managed, which customer groups are likely to make a purchase through social media, how to ensure online payments are seamless, etc.
It's time for retailers still working with legacy applications and technologies to expand their horizons and look beyond their traditional business models. Working with an evolving ecosystem of partners and stakeholders will position them for growth and help in building market share and mindshare that will act as a springboard for everything they do.
Vandana Singal is director, solution consulting at Pimcore Global Services (A Happiest Minds Company). Pimcore is an open-source platform for product information management (PIM/MDM), digital asset management (DAM), content management system (CMS), and e-commerce.
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Vandana Singal is Director, Solution Consulting at Pimcore Global Services (A Happiest Minds Company). Pimcore is an open-source platform for product information management (PIM/MDM), digital asset management (DAM), content management system (CMS), and eCommerce. She has extensive experience in managing presales, product development, and multifunctional teams.