Happy New Year! On to 2021…bold predictions for a better or simply a “normal” year!

Happy first week of 2021! I hope you all had a safe, happy and most importantly healthy holiday season. While the latest trip around the sun has challenged us many ways, there is a light at the end of the tunnel and hopefully better times ahead. Better, simply meaning more normal times! But let’s look at some BOLD predictions for what 2021 might hold in store for us.

Blanket prediction, with multiple Covid 19 vaccines having been approved and now getting into arms, the globe will move towards controlling the virus and allowing the world to put this pandemic behind us. Let’s hope this comes to fruition sooner rather than later. But what else can we expect?

• Stores are not dead…they’re continuing to evolve. Okay I might sound like a broken record, and yes this trend is not unique to 2021. But what is going to be different is the impact Covid 19 had on retail as a whole and stores in particular. It has been well documented of how the lock downs adversely impacted physical stores, restaurants, bars and a plethora of service business that could not be done over Zoom, Teams or Google meet. From a retailer perspective, 2020 accelerated a number of store shuttering, by some accounts doubling the closures from 2019. While brands like GNC, Pier 1 and Chico’s are closing stores, you still see other players such as Amazon, Warby Parker, Bonobos, Indochino and Peleton opening physical locations. We are not seeing the end of the store, we are seeing the accelerated evolution of how the physical store is being leveraged. Yes it will continue to be used to attract and drive traffic to come in and acquire inventory. But will take on an ever growing role – service center (think Apple genius bar), a return center (look at Kohl’s and what they have done with Amazon) or a micro fulfillment node (look for grocers to push this usage). As we emerge from the lockdowns, savvy brands and retailers will continue to rethink and retool how stores fit into their overall strategy. They will not be blindly shuttering those assets.
• Sustainability and the circular economy drives consumer behavior. There is no doubt that what we saw in 2020 was a massive acceleration when it came to ecommerce. And with those mountains of online ordering creating a tsunami of goods being delivered to our front doors, this will invariably lead to a return tidal wave of coming the other way. The amount of returns and how retailers and brands will handle this volume is potentially more than a headache for the industry. Forward thinking retailers will see this as part of a larger theme – sustainability. Returns are a part of the circular economy that has been growing. It is not only the amount of product coming back into the supply chain, but also how retailers will strategically address this as their overall go to market. How do retailers and brands ensure that sustainability is not an afterthought but is integrated throughout the business? Consumers’ sustainability awareness, are deciding factors in how they spend their money. Retailers and brands need to keep this in mind with regards to how they approach all aspects of their businesses – from sourcing to returns.
• Automation gets closer to the consumer. Yes I know, the robots have been here for a while now. But we will automation start getting closer to the end consumer. Granted robotics have already made their way into our homes – see the Roomba. When it comes to our supply chains, automation has been a presence for decades. Starting on the manufacturing floor and now pushing into the sourcing, warehousing and distribution parts of the supply chain. Look for automation to push into consumer spaces in 2021. From sanitization robots keeping public spaces hygienic, robots focusing on security and automation that will function amongst the public to complete order picking or store replenishment. We will also see more usage of automation in the last mile fulfillment, from Kroger to DHL, companies will seek to leverage autonomous robots and drones, to get our stuff to us when and where we want it. Look for automation to become a greater part of our lives, from our homes, to how we get products delivered to our doors and when we are out in public. Hopefully this is not the start of Skynet…
• Not your parents’ point of sale. My first prediction is the store is not going away it is changing…same can be said about point of sale (POS). The days of static, fixed cash registers has long been eclipsed by mobile and cloud based POS. But even this is evolving. POS will become untethered. Only requiring an internet connection and digital interface, modern POS will occur almost anywhere these two tools are present. You might say, so what, we already knew this…but this will expand into social media. We are already seeing a surge into Facebook, Instagram and TikTok to allow for transactions to occur on these platforms. We are finally seeing it come to content via your television (I remember working on a report in 1998 while at Forrester talking about this possibility). We are not far from science fiction shopping where QR codes and other scannable objects will be sprinkled through out our physical world allowing us to interact and shop almost anywhere. Advertisement on a billboard, scan the QR code to purchase. Walking through a park and there is a nice flower arrangement in a planter, take a picture via the PictureThis app and connect with local florists that can sell you the arrangement or individual plants. Our “limitations” to participate in commerce will continue to crumble, as POS becomes omni present. Retailers and brands need to be prepared to service demand anywhere and anytime…in locations not imaginable a few years ago.

Let’s hope that 2021 proves to be all that we hope for. Especially with regards to a wide spread vaccine. Captain obvious comment – but the ability to spread the vaccine globally will be a massive driver to getting the Covid 19 nightmare behind us. Fingers crossed this continues to march towards reality in the first half of 2021. What we did learn from 2020 was the major shock to our system accelerated the thinning of the herd. It also will reveal with brands, retailers and supply chains are best prepared for 2021 and beyond.

Happy New Year to everyone. Here is to a boring and normal 2021.

NetSuite brings full retail experience to a tablet near you

Last week was a tad crazy when it comes to conference season, there were at least 4 conferences I could have and should have attended. However until I can figure out how to be in two places at the same time I had to pick which events I could attend. One of those events was NetSuite’s SuiteWorld in San Jose. Unfortunately I was only able to attend the first full day, but what I took away from the time I spent was their new offering for retail.

They announced SuiteCommerce InStore – a next generation POS (point of sale) and retail reporting tool that bridges the online and brick & mortar experience. Click here for press release. This new offering from NetSuite, which builds on their existing solutions, follows the mantra launched from main stage. Is it an ERP or a web site? At the core of this statement is the belief that you must treat your business from a unified view. There is no longer a view of inventory that is for the eCommerce engine versus one for the traditional brick and mortar world. There is only one view – one that takes a view at ALL inventory, regardless of what channel it is destined for. What this means for retailers:

• Retailers, by providing a more complete view of customers, can now empower their stores to better satisfy customer needs. For example, if Lawrence Williams walks into a Williams- Sonoma store to purchase a new Cuisinart mixer, if equipped with this solution, the store manager and associates will have access to all the data associated with Lawrence. Did he search the web site for the mixer? What color? Which model? Did he look for other products? The store associate can now anticipate and deal with Mr. Williams’ needs more effectively.
• Much better coordination between the online and physical world. One of the most frustrating issues retailers face is have a promotion for a product in a store that could also be fulfilled online, but not having that full view of the inventory. Companies that leverage SuiteCommerce InStore, will be able to react with much more flexibility to fluctuations in demand or inventory, regardless of where the drivers are coming from. This unified view of inventory and customer is key when it comes to meeting the demands of consumers.
• A greater understanding of what is happening on the ground. Retailers have always struggled with gaining a richer sense of what is happening within their stores. POS (point of sale) data is nice, so are orders and even advanced video technology. But what if you could add a rich layer of information that tied in the online and in store experience of the consumer? Retailers will not only be able to empower their stores to better manage the customer experience, but they will also be able to collect behaviors of those customers.

It will be interesting to observe how this solution progresses. It fits into our Matrix Commerce model that looks at the places where digital has allowed the customer and the supply chain to converge. This, edge of the retail network, at the store level, is one of these intersection points. NetSuite retail customers should see this as a positive evolution of the retail solution. Over the past few months, many of the retail executives we have met with expressed the desire to provide their store locations with a complete view of the customer. NetSuite’s SuiteCommerce InStore solution addresses the needs of the retailer to gain greater channel agnostic insights.

Not your father’s POS system

Here is something to tickle your retail supply chain – we are under 50 days until Christmas. Avoiding the debate over the mass commercialization of the holidays, the reality is that consumers will, or already have, started their shopping engines. With so many retailers dependent on good holiday sales, for example Lego moves 50% of their sales between Thanksgiving and Christmas, the ability to properly capture orders is vital.

The POS (point of sale) systems, whether in brick and mortar or on line, are the vital touch point between the consumer and the commerce supply chain. Like with the majority of technologies, this has been impacted by the digital wave. POS systems are not longer limited to the larger systems synonymous with the corner store – remember the ones where numbers would pop up once the large typewriter like buttons were pressed. These systems have evolved into a new range of sleek mobile devices, and those large legacy systems are now smarter. POS systems are also getting into greater areas and increasing their reach – supply chains need to craft strategies about how to take advantage of the new data as well as the new places POS systems will pop up.

For example:

• The POS systems in the air. Those us that have been flying long enough remember the days when we were served a meal and drinks as part of our overall plane ticket. Today if you want a scotch on the rocks and a can of Pringles, you need to pay for these items. Airlines have put mobile POS devices in the hands of their staff to take your payment. Rather than just using these as order taking machines, airlines like Delta Airlines have made these mobile devices a much more valuable part of their supply chain. Beyond just taking payments, the mobile devices are enabled to communicate about customer and maintenance issues. So if the passenger in seat 7a voices a legitimate complaint, Delta employees can use the POS system to give that passenger 10,000 miles. If a seat is found to be broken or an overhead can’t open, the flight attendants can use the system to communicate the problem and location to the destination airport and schedule the appropriate maintenance.
• Infusing retail into other entertainment channels. We have all used to having to walk through the store when we leave a museum, zoo, aquarium or other attraction. But what about the movies? Get ready for your phone to become part of a POS system for the movie theater. I am not speaking of the POS when you are ordering your over-sized tub of popcorn, but post movie viewing. For example – you go see the Transformer movie, once the movie is over as you are leaving the theater there are QR codes on promotional posters at the exit and even pop up kiosks where you can scan your phone to find where to get the latest Transformer toy. There could potentially be a 3D printer right there allowing you to get your item made in place. If you scan the product at the movie theater you may be given a discount – incentive consumer to make transaction at that point. Your portable POS systems – aka your smart phone – will have an app that allows for this to happen and could also communicate with the closest Target, WalMart or other retail channel that carries the item. Or even tie back to Amazon and have the eCommerce giant dispatch your item immediately.

Of course there remains a continued evolution in mobile POS, companies like Square and Apple are allowing anyone with a tablet and connectivity to run mobile POS systems. Retailers can start looking at these mobile POS systems as great data sources – where do most of the transactions happen on the store floor? Are there still locations for impulse purchase displays? Can you tie these mobile terminals into the inventory systems? A prospective buyer is looking for a specific piece of cookware at William Sonoma. The item is there but the consumer wants it in sky blue. Using the mobile terminal the associate helping that consumer can instantly scan the inventory at different stores, identify where an item can be secured and ship directly to the store or to the consumer. The mobile device should also be able to pull up the consumer’s profile: are they a loyal shopper? If so the associate should have the ability to waive shipping costs or expedite the product.

Supply chains need to think of their POS systems as Point of Service, not sales. In a world of Matrix Commerce, these are the intersection points between the consumer and the commerce supply chain where the digital reality has great impact. How companies take advantage of this will determine who leads and who is a laggard.

 

Zero moment of truth – the true demand signal

I was reading a great eBook by our friends over a Google that discuss what they call ZMOT: the “Zero Moment of Truth.” Traditionally we have been taught to focus on two moments of truth. The first being when a consumer gets to the store shelf. At this moment, your inventory had better be available in the shape, color, size, price and quantity that the consumer desires. The second moment of truth occurs when the consumer begins to actually use the item. The experience had better meet their expectations or even better – exceed the expectations.

This model has changed with our 24/7 connectivity as well as the rise of mobility. Now there is what is termed the zero moment. This is the moment when your future consumer realizes they have a need or desire, maybe even want your particular product. With our global connectivity and enhanced by mobility, these consumers can now access a world of information that is at their fingertips…literally. We are starting to see the behavior shift this creates for both retailers and consumers. Retailers and manufacturers must have their house in order when a consumer arrives at ZMOT. The question is – how does this impact our supply chains?

There is a lot to be said of demand signals being picked up from data sources such as POS, order history, inventory levels to name a few. However what about the rich data that can found at ZMOT? An example: today a manufacturer can pick up POS data that shows a high demand for flu medicine. They might

What if you had this map weeks before the outbreak?

correctly assume that there is a flu outbreak in that geography and shift inventory within their system to meet this demand. But could this already be too late? What about looking for demand signals at the ZMOT? When consumers are searching on line for “signs of the flu” or “how do I tell I have the flu.” Google has already demonstrated how it can take data from ZMOT and predict the flu outbreak – click here for story. Rather than waiting to see what is selling, what about anticipating what is going to be looked for at the store shelf?

For your supply chain, it would be beneficial to leverage this data to better anticipate demand. Rather than waiting for the data coming from POS, leverage the information at ZMOT to anticipate how that demand will happen. POS and other data can be used in conjunction to adjust your demand signals. More and more consumers already know what they want when they enter your store or at the purchase point, those that can not only get to them at ZMOT but also leverage information from ZMOT will ensure that the first moment of truth is heavily in their favor.

The saying “you read my mind” can become a reality if you tap into the demand signal that is at the ZMOT.