This blog is sponsored by SAP.
The retail industry faces constant change and uncertainty driven by new technologies and growing pressures. Retailers must grapple with continuous updates to their delivery models, evolving expectations from educated shoppers who demand innovation, supply chain disruptions, intense competition and the need for a vast data foundation to harness the power of AI. Specifically, how challenges from more than a decade of continuous supply chain volatility and the ongoing issue of tariffs in the US are impacting retailers.
A SAP Insights survey revealed that in the coming year, retailers plan to prioritize the expansion of indirect channels, enhance their existing market presence and enter new markets. To successfully address these priorities, retailers must go beyond simple tech adoptions and embrace an integrated foundation that transforms every aspect of their business.
“IT leadership and the technologies they introduce are key, acting as a force multiplier and moving the function from a support role to an enabler of agility and customer experience. For retailers, this is essential because today’s consumer expectations focus heavily on omnichannel journeys, real-time inventory visibility and personalization.
Retailers need a unified, intelligent, responsive retail platform that addresses every consumer and operational touchpoint to meet and exceed expectations. This transformation should be built on modular and consistent platforms to preserve a unified experience, and it’s critical to find technology partners aligned with the brand’s ethos to ensure success. Christoph Schroeder, SAP’s Global Vice President of the Retail Business Unit, noted, “Unified, intelligent retail platforms are no longer optional. They are foundational to delivering the responsiveness, personalization, and operational excellence that modern consumers expect.”
Driving customer-centric merchandising
Shoppers today demand a certain level of personalization and ease when making purchases. They are smart, but often feel overwhelmed by the number of choices available. To simplify the buying journey, retailers need to adjust their strategy, shifting from product-centric to customer-centric merchandising. This gives shoppers the opportunity to buy what they want, when they want, on the channels they feel most comfortable.
Retailers can no longer simply showcase the merchandise that is expected to generate the most revenue. To build brand loyalty, retailers must understand customers’ shopping habits and preferences. Such an understanding is key to optimizing product assortments, pricing strategies and flexible fulfillment options, ultimately driving profitability. This approach benefits not only consumers but also employees by equipping associates with detailed product information and in-store technologies.
Retailers need an omnichannel solution. With SAP Cloud ERP for Retail, retailers can benefit from a ready-to-use enterprise management solution that provides real-time visibility into their operations, makes data-driven decisions, and meets evolving consumer demands with the flexibility to deliver seamless experiences across all customer touchpoints.
Building agile and transparent supply networks
Beyond customer expectations, retailers must also contend with the unpredictability of supply chain disruptions that can be caused by delays, unexpected costs and inventory discrepancies. Retail solutions from SAP can help address these challenges. Retailers can build transparent and agile supply networks, allowing them to predict demand and match procurement, inventory, transportation and make logistics decisions that drive profitability.
Brands like Payless, faced with fluctuating market conditions, leveraged SAP Cloud ERP to transform their supply chain, enhancing data consistency and streamlining sourcing flexibility to reduce costs.
Creating seamless omnichannel and customer experiences
Meeting customers’ evolving expectations is not easy; however, to drive growth, retailers need to provide exceptional customer experiences. Many retailers are prioritizing market expansions into new locations to meet the growing demands of consumers for convenience and enhanced shopping experiences. Adopting an omnichannel strategy allows retailers to sell and fulfill from anywhere at any time.
The SAP Emarsys AI in Retail Report underscores the need for retailers to adopt a hybrid strategy, which emphasizes flexibility and choice. Shoppers still value the in-store experience. In fact, data reveal that 55% of recent purchases were made in physical stores, while 54% were made online.
With SAP, retailers can gain a unified, omnichannel view of each customer, create personalized offers and enable smart source ordering, leading to increased conversions.
Using AI-driven technology for growth and simplification
AI integration is no longer an option, but a necessity. Data from the SAP Insights survey illustrates that organizations see AI as the primary solution for growth and simplification. The SAP Business Suite integrates AI across enterprise resource planning (ERP), merchandising, planning, fulfillment and customer engagement applications.
Designed with retailers in mind, SAP Cloud ERP for Retail helps businesses expand and reimagine their operations. By addressing the needs of consumers and managing core operations from a single management solution, and streamlining operations. Retailers can oversee inventory, manage financial accounting, have real-time visibility, enable data-driven decisions and focus on customer experience and growth, while reducing operational complexities that are essential to driving growth.
SAP can help retailers:
- Boost efficiency with unified inventory, supply chain and customer relationship management
- Gain real-time visibility to make data-driven decisions
- Promote smooth data flow, minimize operational complexities and improve efficiency
- Leverage AI to empower retail innovation and adapt to business needs
The unified path to success
In the current state of the industry, retailers need to innovate. They need more than just operational efficiency. To deliver personalized customer experiences, retailers must implement integrated systems that unify applications, data and AI. Taking a unified approach will unlock various use cases across merchandising, supply chain, customer experience and omnichannel operations. Adopting a flexible and unified architecture will also foster rapid innovation and operational excellence.
To learn more, download the white paper or speak with a retail solutions expert at SAP about expanding profitability and growing customer service through innovation. For additional insights, access the SAP on-demand webinar, “How Birkenstock is Scaling Globally: Protecting the Brand and Elevating the Customer Experience.”