Customer Connect Day Amsterdam insights: How merchandising teams are using technology to prepare for the future
During our recent Customer Connect Day in Amsterdam, our team sat down with our customers to explore the future of merchandising and the strategies to maximize customer lifetime value.
We gained valuable insights into our customers' perspectives on Artificial Intelligence (AI) and Machine Learning (ML), their implementation of automated merchandising processes, and their ability to thrive in an ever-evolving world.
Here's a summary of the topics discussed and the insights shared from our customers:
AI and ML: exploring the world of AI-driven recommendations and predictive analytics from a merchandiser’s perspective
It’s clear by now that AI is shifting the way organizations work. In fact, experts predict that using AI at a larger scale will add as much as $15.7 trillion to the global economy by 2030 . But how exactly are leading retailers using it to level up the performance of their merchandising?
AI and ML is a fan favorite amongst merchandisers as it can help to accelerate time-consuming processes and improve the performance of digital experiences. What’s more, it can single-handedly improve and scale personalization by analyzing vast amounts of customer data, including purchase history, preferences, and browsing behavior. By understanding individual preferences, you'll find it easier to create a more engaging and tailored shopping experience, leading to increased customer satisfaction and loyalty.
Gone are the days of gut-based decisions. AI and ML algorithms use data to provide merchandisers with actionable insights. This data-driven approach can empower your merchandising team to optimize product assortments, set competitive prices, and respond swiftly to changing market dynamics.
The COVID-19 pandemic has accelerated shifts in consumer behavior, making adaptability crucial for merchandisers. AI and ML empower merchandisers to detect emerging trends and swiftly adjust strategies to optimize results. These technologies provide the agility needed to stay ahead in a rapidly evolving market.
The innovative nature of AI means some businesses see it as a threat. However, our customers use it as an intelligence tool to upgrade experiences and supercharge processes (if it’s used in the right way with reliable data to fuel the engine). They recognize that AI cannot replace human emotion, make intuitive decisions or be culturally sensitive.
Even though the value of AI is well understood, our customers also know how important it is for merchandisers to navigate potential ethical pitfalls. AI and ML can be huge drivers to save on costs and power efficiency, but legal liability means accountability sits with us humans. To mitigate risk, you need a platform that is transparent about how it uses data and a workforce with the right skills that knows how and when to use it. Internal training programs should focus on demystifying these technologies, providing hands-on experience, and fostering a culture of continuous learning.
It’s clear the future of merchandising is intertwined with the power of AI and ML and we’re thrilled our customers are embracing its innovative power.
Automating merchandising processes: discovering how automation can streamline and enhance your merchandising efforts
In a recent McKinsey survey of more than 30 retailers, merchants spent approximately two-thirds of their time gathering data, managing exceptions, “firefighting,” and participating in meetings. They only spent one-third of their time working on critical strategy and analytics or insights.
How are our customers’ merchandising teams automating processes to increase operational efficiency?
By leveraging data analytics and machine learning, you can optimize assortment planning, accurately forecast demand, and implement effective markdown strategies. The result is a finely tuned-operation that not only boosts sales but also maximizes profitability through intelligent, data-driven decisions.
For example, forecasting software can automate the prediction of future demand, allowing for better inventory planning, assortment decisions, and allocation of resources. This saves a huge amount of time and mitigates human error that could come into play without it.
The shift from manual to automated merchandising processes is not without its challenges. Overcoming resistance to change, ensuring data quality, and integrating new technologies seamlessly are common hurdles. The best way to jump them is to test and learn. For example, by using AB tests, you can make data-led decisions on what approaches are more effective to meet business objectives.
For a successful shift, there needs to be effort across the entire organisation, with shared goals to drive change.
Identifying industry and tech trends: learning how to adapt your strategies to embrace change and remain competitive
From AI and the Internet of Things (IoT) to robotics, businesses are presented with unprecedented opportunities to streamline operations and enhance competitiveness. Proactive adaptation to such emerging technologies is paramount for those aiming to lead rather than follow.
Automation is the key to efficiency in the merchandising workflow. From supply chain management to store layout optimization, retailers can use these technologies to enhance decision-making, reduce costs, and improve overall operational effectiveness.
Merchandisers are also using it in search. With technologies like GPT, conversational search interfaces are transforming user interactions, presenting new ways to engage with customers and streamline the search experience.
Our customers also highlighted the dominance of the Metaverse and social media to reach a wider audience, stay relevant, improve customer engagement and innovate marketing.
Failure to adapt to industry trends and emerging technologies poses a significant risk as those who lag behind are likely to lose competitiveness. A proactive approach is not merely an advantage but a necessity for long-term success.
But how can you get the entire team on board to drive change? Reluctance is natural, but fostering a culture of innovation and adaptability is essential. Clear communication, employee engagement, and targeted training programs can help organizations overcome resistance and drive successful transformations.
In conclusion, navigating the tech tide requires a proactive stance, strategic alignment, and a commitment to innovation. Businesses that embrace emerging technologies and industry trends while maintaining their core values will not only survive but thrive in the ever-evolving marketplace.
Thanks for all the enthusiasm and support from our customers. We look forward to bringing you more insights from our future Customer Connect days around Europe.