Making it to the big leagues in retail isn’t as simple as it used to be. eCommerce is set to dominate the retail environment, bringing with it a whirlwind of change. In fact, experts predict that by 2026, retail eCommerce sales will soar to just over 8 trillion USD. With this evolution, modern shoppers have come to expect more than brand optics and flashy product lines, and are well-versed with the latest tech: fishing for discounts, scrolling through hundreds of brands, and sifting through online reviews in minutes. Competition is fierce, more so than ever before, and young, new-age disruptors, innovative startups, and even behemoths of retail, all find themselves on a relatively level playing field, thanks to modern technology and advancements in automated tech and AI.
The world is in an age where any eCommerce business can equip itself with global-scale, robust, state-of-the-art solutions to help them rise to the top and the ones who don’t, fall behind. For those new to retail tech and how to utilize it, it can be difficult to pinpoint where exactly to allocate time, resources, and money. That’s where we come in – Intelligence Node’s product suite and vast content archives have everything your brand needs to catch up (and exceed) your competition.
Read ahead to uncover eight key focal points to drive your digital retail strategy and achieve maximum profitability!
1. Modern Pricing That Converts Consumers
Amid the hustle towards innovation, creating brand value, outperforming competition, and capturing global audiences, where does pricing lie in your brand’s strategic hierarchy?
- Outdated pricing strategies in retail
- Price-sensitive, tech-savvy consumers
- Intense online competition
- A massive scale of products and services sold
- Constantly shifting trends and market shifts
- Complex, slow, and often inaccurate solutions
““Shoppers today have real-time visibility to compare pricing on any given item, at any given time and location. This Shopper capability oftentimes exceeds the visibility of many retail merchants, who are still working with antiquated legacy systems to process days-to-weeks old competitor pricing data. It’s imperative that Retailers strive to “catch-up” with their Shoppers, in order to be competitive for purchase decisions that are being made today.””— Lyle Walker, VP of Strategy, Intelligence Node, with 30+ years of experience helping retailers leverage data r
Over the course of 2022, roughly 50% of consumers in the US said they had grown to be more price sensitive– making price one of the top factors in determining whether or not they will make a purchase. That’s why today, lagging behind in promotional activities and discounts could cost you shoppers, who can compare prices in split seconds and shuffle through dozens of choices with ease. To avoid this, it is important to monitor shifts in pricing across the market, as well as seasonal changes. In an oversaturated market, however, it is impossible to track all your potential competitors at once. It’s more challenging still to adapt to their activity and pricing quickly and efficiently. With Intelligence Node’s price optimization suite, learn how state-of-the-art, powerful automated pricing tools can transform your approach to pricing and boost margins, free up your time and resources, and sharpen your awareness of competitor activity.
2. Dynamic & Competitive Pricing
The eCommerce business boom has created an incredibly competitive environment: today, major retailers switch up their pricing rapidly (and constantly) and it is all too easy for any one of hundreds of competing brands to undercut the best of your products with nothing but a more appealing price tag. Dynamic pricing is everywhere: for example, Amazon’s massive online marketplace leverages user data and market trends to change their product prices every ten minutes! This swift, dynamic pricing strategy earned the eCommerce business roughly 25% higher profits.
- Global competition with multifaceted pricing strategies
- Seasonal changes in pricing and discounts
- Constant changes in demand
- Flexible shopping options allow customers to compare prices easily
- Blind discounting and pricing can lead to businesses selling themselves short or missing out on shoppers
- Slow implementation timelines for price changes
This has been observed worldwide, and according to a survey conducted with 2000 UK-based shoppers, 40% agreed that they switched brands while shopping because they found other brands with better prices. Similarly, one in three shoppers prefers to switch up the brands they buy from, and do not practice brand loyalty. Switching up prices to stay competitive makes a difference- and the key to this is maintaining an accurate overview of competing products and prices in real-time. Without the capacity to track competitor movement at a global scale and make changes to strategy on the go, brands are liable to lose shoppers in swathes, and struggle to keep up. Further, as prices change with the seasons and trends, it is imperative that brands stay aware of competitor activity and rapid market shifts in real time to stay afloat. To understand how automated tools and AI solutions can level up your pricing game instantly, discover more about dynamic and competitive pricing solutions below!
3. Assortment Planning & Product Availability
Modern-day shoppers are empowered by the flexibility to choose between endless options across brands, vendors, and price points. If ever a retailer does not have the right products available: be it sizes, styles, unisex collections, or discounts, it is easier than ever for a customer to simply switch retailers or brands, rather than wait for stock to return. One simple search and dozens of alternatives are instantly available to accommodate their needs- costing your brand precious sales in the name of poor inventory management, and ineffective utilization of historic data, shopper trends, and competitor insight. The perfect example of tackling product availability issues in modern retail is illustrated by fashion retailer and eCommerce business ‘Guess’. The brand, by onboarding modern planning tools was able to double their operating margins to 12% and collate its sales data effectively enough to create plans that differed by region across hundreds of stores worldwide.
- Seemingly unpredictable trends and buying patterns
- Outdated and manual assortment planning strategies
- Identifying seasonal vs permanent products across geographies
- Calculating the correct volume of merchandise to meet consumer demand
- Complex, overwhelming sales data that is difficult to interpret
According to the Harvard Business Review, “72% of stock-outs were due to faulty in-store ordering and replenishing practices”– an avoidable issue, easily managed by effective assortment management practices. However, inventory planning is not exclusive to availability issues. Curating the correct assortment in terms of size, style, color variants, etc., that resonates with key audiences helps your brand ensure it is up to date with shopper and global competitor sales trends. Retailers must take advantage of modern retail tech to help strategize and accurately forecast their assortment availability ahead of their competition to avoid losing out on sales. Learn how below!
4. Digital Shelf Optimization
In today’s digital world, a strong Digital Shelf (and Omnichannel) presence is of utmost importance. By definition, the digital shelf is the online manifestation of a brand’s retail activity- but some brands take it a step above and beyond. Hershey’s, for example, has created a stellar digital experience with flexible delivery options, excellent visibility, intuitive design, and engaging visuals, descriptions, and purchase options for shoppers. With a razor-sharp focus on conversion via its eCommerce business, the chocolatier has invested largely in a content-driven digital shelf, optimizing its every offering for the best possible online shopping experience.
- The battle for first-page visibility on marketplaces
- Unclear product images, descriptions, and nomenclature
- Inaccurate or insufficient displays of assortments and product variants
- Unoptimized pricing
- Limited reviews and ratings
A memorable, effective digital shelf entails a strong base knowledge of what works in a digital environment.
- A seasoned eCommerce retail player ranks high on SERPs by investing in strong SEO solutions to ensure visibility. When shoppers use Google or similar search engines to find a product, first page results enjoy 95% of the total traffic.
- The highest-performing products on marketplaces and search results also display attractive year-round pricing, executed via dynamic or competitive modern pricing strategies
- It is advised for SEO and to rank on the digital shelf to ensure detailed product imagery and descriptions for users to look into as they shop
- It has even been seen that reviews and ratings have an impact on sales, as 90% of shoppers are more likely to convert after reading positive reviews
The cumulative effect of all the features and functionality of your digital store can thus be sharpened and optimized to boost sales. To level up your brand’s impact on the online arena and dominate the digital shelf, keep your team up to date with its best practices, challenges, market trends, and consumer expectations. To begin, take a Digital Shelf deep dive with Intelligence Node today.
- How Can Next Generation Digital Shelf Technology Help You Grow?
- Digital Vs Physical Shelf: What Each Means for Omni-channel Retail
- 8 Ways Retailers Can Leverage Customer Reviews Using Machine Learning
- A Comprehensive Guide to the Digital Shelf
- Own the Digital Shelf with these 5 Best Practices
- 5 Digital Shelf Challenges Every eCommerce Business Should Address
5. Supply Chain & Trend Forecasting
Largely owing to the massive surge in demand in the wake of the pandemic, supply chain issues have compounded to an all-time high in recent months. Compounded with the shutdown of manufacturing plants and closed borders, eCommerce businesses have found themselves with a surplus of the wrong products and a dire shortage of items in high demand. One such instance includes Macy’s & GAP, both of whom were caught unprepared as consumer trends shifted. When shoppers changed preferences from loungewear to dressier officewear this year, the stores were forced to offer markdowns on their excess loungewear, impacting their margins, as the switch back to daily wear moved faster than anticipated. On the other hand, Intelligence Node’s trend forecasting model specializes in identifying (And eliminating!) such instances. For example, in November 2021, as market signals indicated a drop in visibility and price of ‘jogger jeans’, we were able to correctly identify a trend reversal ahead of time: a prediction that could save brands from potentially overstocking low-demand products.
- Severe resource shortages and slow movement of goods
- Inability to effectively predict sales volumes and demand in advance
- Slow moving products between channels
As production facilities slowly reopen to full capacity this year, retailers must remain wary of slow movement of goods and interrupted supply of specific base materials. Now, at the cusp of the recession, is the perfect time for businesses to take close stock of their supplier relationships (see ‘MAP’ Policy) and identify touchpoints with higher opportunities for disruptions (such as distance between ports and suppliers) wherever possible. Even with the best of assortment planning, keeping popular items in stock is often out of retailers’ hands- this is where trend forecasting can connect the dots. Trend forecasting is a term used to describe the technical ability to identify trends and attributes with a high probability of future success. Without data intelligence guiding your inventory planning, your brand could be liable to overstock or understock key items, dampen your sales growth, and waste valuable time and shelf space. Read below to equip your retail store with the best tools to avoid supply chain and inventory issues!
- The Importance of a Supply Chain Strategy for eCommerce
- 5 Supply Chain Strategies Your eCommerce Store Can’t Be Without
- 5 Ways to Utilize Your Distribution Data to Improve the Supply Chain
- Supply Chain Metrics That Matter
- Proven Right: How Our Trend Forecasting Model Went From Probability to Actuality
- Is Your Product Primed for Future Success? Know with Intelligence Node’s Probability Model
6. Accurate and Efficient Product Matching
When dealing with massive, complex, and multifaceted data sets, there is no room for human error. To eliminate that risk, AI Product Matching enables retailers to instantly compare their products’ prices against exact or similar matching products by competitor brands accurately in a completely automated process. For example, a CPG player may decide to analyze its own “SPF 50 Sunscreen” product against the same product by other retailers. According to the size, brand, color, price range, model, etc. of the product, similar and exact matches can be extracted to compare and analyze the performance of each to alter pricing strategies accordingly.
- Lack of fast, accurate, and reliable product matching data
- Inaccurate identifiers for products: title, attributes, image
- Slow, inefficient automated solutions
- Inability to match and compare products against competitors
Accurate product matching enables retailers and strategists to make informed decisions about the pricing and positioning of their products. Intelligence Node boasts unparalleled product matching capabilities of 99% accuracy, providing your business with simplified, actionable data and insights to help boost your profits with straightforward strategic changes. For a deep dive into the details of product matching and its importance in automated price optimization, read below!
- The Tech Powering Intelligence Node’s 99% Product MatchingAccuracy
- 6 Product Matching Use Cases for eCommerce Businesses
- Product Matching AI: The Secret Weapon Powering Successful eCommerce Teams
- The Role of Web Scraping in Modern Retail
- How to classify and match products with Machine Learning
- Why Retailers Must Use A Price Comparison Engine For Their Ecommerce Website
7. MAP Monitoring
MAP (or the Minimum Advertised Price) is the minimum price set for a product below which retailers and resellers are not allowed to sell. The MAP of a product is an incredibly useful metric that helps brands maintain their brand value and image, identify potentially unauthorized sellers, or even counterfeit products on third-party marketplaces and websites.
- Loss of sales and margins
- Loss of brand equity
- Rampant copycat sellers
- Similar counterfeit products on third-party marketplaces
- MAP violated products eat into your brand and retailer sales
An example of a brand with excellent MAP enforcement is Dyson. The brand has prioritized awareness of counterfeit products with a clear reporting protocol on its website- allowing shoppers to report counterfeit vendors as they find them. According to a recent Forrester report, with a combination of airtight supply chain management and a robust MAP policy, Dyson has established best-in-class brand control for its eCommerce business. This can also be credited to controlled distribution processes- its excellent DTC experience has enabled the brand to push sales directly from its own channels, eliminating the need for third-party vendors. These measures have helped seal Dyson’s margins and tackle counterfeit activity on a global scale, proving that effective brand control and MAP monitoring can push your brand and sales performance sky-high.
A weak MAP policy renders your business vulnerable to scams and infiltration of fake sellers, who dilute your brand image and eat away your margins. Every year in the USA alone, MAP violations cost retailers 2.6 billion USD in lost revenue, and 20% of products tracked by Intelligence Node report MAP violations daily. That being said, with accurate market oversight and the ability to identify potential infractions instantly, AI tools such as ours empower you to tackle these issues head-on. Learn how below!
- Combating Counterfeit Activities Online And Protecting Your Brand
- Consumer Attitudes & The Growing Counterfeit Concern
- A Robust MAP Compliance Across Online Marketplaces
- Enforcing a Robust MAP Policy to Protect your Brand Reputation
8. Consumer Behavior & Shopping Trends
With a ‘full stack’ of retail solutions and modern technology at your sleeves, the world of retail is yours for the taking. However, the impending recession is sure to create a wave of changes in shopper behavior and ‘intentional’ spending habits in the year to come.
- Variable consumer behavior and preferences in a global market
- The recession and the changes that will follow
- Next generation shoppers and shifting priorities
Keeping an eye on the market as well as your target consumer base will help your business navigate these unprecedented times, informing your strategic decisions for the foreseeable future. To stay abreast of consumer trends and market shifts across various segments, here are some resources to help you gear up for 2023 and beyond!
- Winning the Retail Brand War: Growth in 2023
- Luxury’s Success Against All Odds
- The Ultimate Guide to Home Decor Trends in 2023 and Beyond
- The Beauty Industry Glow Up of 2022 & Beyond
- 50 Key Statistics to Win Online Consumers in 2023
- The Changing Expectations of Millennials & Gen Z Shoppers
- Preparing for 2023: Retail Trends to Watch Out for
With that, you’re at the starting line of improved efficiency, profitability, and online visibility. But a blueprint is just the beginning: be sure never to miss out on the latest news in retail by subscribing to Intelligence Node’s Newsletter- and to see how you can optimize your digital strategy with AI, book a demo today! This new year, watch your profits, efficiency, and turnaround time hit records with Intelligence Node.