Mastering the supply chain conundrum with CX

BY Australian Retailers Association
08 August 2019

To future-proof your retail business, you’ll need to understand the symbiosis between CX and supply chain.

What do iconic retailers such as Nike, Starbucks and H&M have in common? They’re featured in Gartner’s Supply Chain Top 25 2018 report as customer experience (CX) champions. What can retailers learn from these leaders, and how can they apply their winning strategies to deliver top notch customer experiences? Let’s identify three things that great retailers do well:

Putting the power of choice into the consumers’ hands

The concept of choice has exploded with the rise of e-commerce and the technologies that serve it. Before, retailers relied on the physical footprint of brick-and-mortar stores, now e-commerce is pushing and pulling consumers in – and promoting choice by giving consumers the ‘endless aisle’, 24/7 accessibility, and a multitude of shipping services. A retailer that needs no introduction when it comes to this is Amazon.

All in all, it comes down to knowing what customers want and ensuring that your supply chain infrastructure and technology stack, well, stacks up. Neopost Shipping’s latest report, ‘Great Expectations: Shipping, CX & Gen Z’ found that 98% of Gen Z consumers abandon their cart when they can’t find a shipping service at checkout that can deliver their order on time, with 44% then proceeding to find a competing retailer who can.

The power is already in consumers hands – but on which side of the coin would you prefer to be? Supporting the nature of how consumers shop today is easier than you think – consider a shipping software solution that helps you build a wide range of shipping options as part of your CX strategy.

Scaling success with smart supply chain practices

According to Australia Post's Inside Australian Online Shopping 2018 e-commerce Industry Paper, in the last year, Australian e-purchase experienced 19.2% growth, compared to an 11.5% increase from the year before. More than ever, future-proofing your retail business with supply chain strategies that can scale and flex according to market trends is imperative.

Some of the innovations that global players have successfully adopted include fit-to-size automated packing machines that are 10x faster than manual fulfilment. These machines are not only cost and operationally efficient, they’re also supporting a greener tomorrow by reducing package volume and the amount of packing material.

Similarly, retailers such as Decathlon are experimenting with customised automated parcel lockers in their stores to draw online shoppers to pick up their Click & Collect orders. Done at scale, in-store lockers can lower the cost of shipping and fulfil online orders whilst driving basket sizes up - as online customers often pick up additional items while visiting a physical store.

Logistics leadership in retail

Retail is constantly evolving. From the Walmarts to THE ICONICs of the world, a strong leadership position when it comes to supply chain and logistics can be a significant competitive advantage for retailers of any size. The challenge for many is untangling the complexities that comes with building and executing a best practice shipping strategy. Retailers must juggle consumer-facing demands such as delivery choices and transparent tracking of their shipments with a logistics process that considers the different practices of last-mile partners.

Having the right tools to help automate time-consuming processes from the shopping cart right through to when an order is delivered in the hands of a customer, can drive losses incurred in the shipping and fulfillment process down. In fact, it can even transform into a conversion and retention tool if done right; 71% of consumers will buy again from a brand that provides them with a positive shipping experience, and 56% will do the opposite when the shipping experience is poor. Leading from the front when it comes to how your retail business drives supply chain and logistics innovation is key to success.

KPMG’s Global Retail Trends 2018 report forecasted that by the year 2020, customer experience will overtake price and product as a key brand differentiator. But Gartner’s report tells us that we’re already there. Consumer expectations are already evolving to expect more, and top retailers are already making headway in meeting these expectations.

To survive the next evolution of retail takes more than just hard work – retailers need to step up and put supply chain innovation on the agenda or risk the ire of today’s choice-empowered consumers.

Understand the next generation of consumers by downloading Neopost Shipping’s 2018 report, ‘Great Expectations: Shipping, CX & Gen Z’: http://bit.ly/GreatExpectations-AU

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ABOUT THE AUTHOR

Australian Retailers Association

Founded in 1903, the Australian Retailers Association (ARA) is Australia’s largest retail association representing Australia’s $310 billion sector, which employs more than 1.2 million people. As the retail industry’s peak representative body, the ARA works to ensure retail success by informing, protecting, advocating, educating and saving money for its 7,500 independent and national retail members throughout Australia. For more information, visit www.retail.org.au or call 1300 368 041.

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