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GUEST COMMENT Embracing agility in a global retail market
by Jamie Merrick
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Barriers between regions continue to be broken down by retailers and consumer goods manufacturers operating in an increasingly homogenised market of global brands, single currencies and common languages.
Our research of 1,000 UK consumers aged 16-34 years old revealed that 63% are no longer concerned about which country an item comes from when shopping online. Retaining loyalty is just as challenging with less than half (43%) of millennials remaining loyal to a particular retailer or brand manufacturer.
Millennials from around the world are seeking to shop with businesses that are flexible and adaptable enough to listen. They want to interact with retailers that adjust to their needs and desires. In addition, they want this culture of experimentation to be underpinned by a strong core of customer service.
Highlighting that service is now more important than where goods are coming from, 29% of UK consumers and 31% of global consumers expect the same delivery times for an item, irrespective of which country it is coming from.
Keeping up with competition
The emergence of consumers that are communicating, connecting and socialising in a different way is creating a significant change in attitude that needs to be addressed. Price alone won’t make retailers competitive when competing internationally. Technology is lowering the barrier to entry for new suppliers, services and products. There is simply more choice and consumers are taking it as they become more global in their outlook.
Yet, there is evidence that UK retailers and brand manufacturers are struggling to cope with technology-savvy and demanding consumers from across borders. Careful consideration needs to be given to the logistical arrangements that are needed to facilitate an increase in demand. In total, 76% of the 100 UK retailers and brand manufacturers that were surveyed admitted that they have been caught out online by sudden spikes in demand or trends that have led to a particular item going unexpectedly out of stock.
Retailers not only need to roll out technology that consumers demand, but they need to fully embrace and understand it, in order to drive value to the business. Technology should be an enabler, not a barrier to innovation.
Navigating a global common market
In order to navigate the emergence of a global common market that is filled with diverse social communities, proliferating brands and channels, retailers need the agility to quickly respond to changes. It’s also important to remember that despite increasingly common models of behaviour between different cultural groups, there are key differences that will determine the scale of success in any given geography.
Reinforcing the complexities of competing in a global retail market, 28% of retailers agreed that entering new international markets is a challenge. A further 26% highlighted that competing with international competitors that are entering domestic markets is also a significant test.
While online channels may offer the quickest and cheapest way to build brand awareness in new markets, any engagement needs to take into account variations in behaviour. For example, it may mean sympathising with consumers in certain jurisdictions that are nervous when it comes to data security and data-sharing, by introducing more visible and clear policies that demonstrate with who and where your data will be shared (or not shared). Alternatively, it may mean taking advantage of the opportunity to smooth out the checkout process, especially in countries where convenience is a top priority.
The ultimate key to success is in developing a digital backbone that enables retailers to rapidly scale their business across multiple countries. To overcome the challenges inherent in competing in a cross-border retail market, brands need to use digital platforms that integrate ecommerce into part of a wider omni-channel approach that can respond to the common modes of behaviour between national groups, whilst being flexible enough to adapt to nuanced regional differences.
Jamie Merrick is head of industry insights at Salesforce Commerce Cloud
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