Modern Retail

What’s in Store for Retail in 2019? Manhattan Associates Makes its Top 5 Predictions

LONDON – January 23, 2019 – With shoppers becoming ever more demanding and retailers under pressure to deliver the seamless service experience consumers crave, Manhattan Associates, Inc.(NASDAQ:MANH) has identified five key themes it believes are set to dominate the retail agenda in 2019:

  1. Holistic Customer Experience Management
  2. Expansion of Omnichannel Fulfilment Strategies
  3. Making Ship from Store Profitable
  4. IoT Enters the Store with RFID Leading the Way
  5. Smart Returns Management

“As consumer expectations rise, new innovations emerge, and geo-politics cloud economic conditions, the pace of change in retail in 2019 will continue to accelerate with profound implications for the way retailers connect with their customers,” commented Craig Summers, Managing Director, UK, at Manhattan Associates. “We see five key trends that are likely to influence the retail scene and shape retailer strategies in the coming year.”

1. Holistic Customer Experience Management

Creating exceptional shopping and service experiences is fast becoming the key to retail success. However, many retailers fall short when it comes to offering this because they can’t effectively manage a customer journey through every touch point, both physical and digital. In 2019 we will see retailers invest to bridge this gap and embrace tools and technologies that have not only been specifically designed for the complexity of modern commerce but enable them to really listen to their customers. This new era of customer engagement will allow associates – in the store and in call centres – to have actionable customer insights at their fingertips; offering better service and ensuring customer loyalty. But retailers cannot forget the growing population of digital natives, young buyers who look for self-service options online first. Whether in the contact centre, the store or online, leading retailers in 2019 must be able to engage anywhere.

2. Expansion of Omnichannel Fulfilment Strategies

The ‘buy anywhere / deliver anywhere’ expectations of today’s omnichannel shoppers may just make 2019 a ‘make or break’ year in the history of retail. For retailers without the means or commitment to embrace omnichannel commerce, the future is becoming bleak. For those who have started down the track, continued devotion to delivering on the customer promise will be required to have a shot at survival. Retailers must become committed to being able to fulfil anywhere in 2019.

The warehouse will become a critical enabler, as retailers look beyond the store and recognise that the warehouse will be critical to support omnichannel commerce. The ability to process wholesale and store replenishment wave processes simultaneously with consumer-direct wave-less processes becomes critical in the time and cost-constrained world of unified commerce. We will also see more retailers implementing advanced automation in the warehouse. The use of robotics in new and existing warehouses is expected to boom and the ability for these new technological resources to work with inventory awareness effectively, alongside human capital, is key. For many, the mindset has often been man versus machine, however, if retailers want to future-proof their warehouse in 2019, they must look to the synthesis of man and machine to drive growth and efficiency.

3. Making Ship from Store Profitable

The retail store network should be an advantage against the large, online market-places. However, store fulfilment duties, along with customer service and selling is a major challenge for store associates. As such, stores are, in many ways, more complicated than a distribution centre, so the traditional ‘closest location’ sourcing logic doesn’t work when hundreds of stores are added to the network. The good news is, the latest omnichannel technology is making ship from store a sustainable, more profitable part of retail’s new normal. Where store associates are equipped with intuitive and responsive apps that guide them through tasks across multiple orders, allowing them to easily pause and resume, fulfilling orders quickly during periods of downtime becomes a practical reality. Additionally, an order management system that learns in real-time, and understands not only location and hard parcel-shipping costs, but understands markdowns, closeouts, in-store labour capacity, and more, means ship-from-store can be done efficiently and profitably for retailers investing to fulfil anywhere.

4. IoT Enters the Store with RFID Leading the Way

Inventory accuracy within the store has traditionally been a huge challenge for retailers, as items tend to move within the store, as they are left in changing rooms or returned to stock in the wrong location. As retailers accelerate the rollout of store-based fulfilment options such as ‘click and collect’ and ‘ship-from-store’, it is crucial that they have a high level of inventory accuracy within the store.

As the cost and size of RFID technology drop to a level that allows companies to embed RFID chips into smaller, everyday products, retailers are able to monitor the status of each item of inventory, wherever it is in the store. This level of accuracy also creates better associate experiences, as team members who are locating items for store pickup or shipment can be directed to the exact location of the items needed. Not only does this mean the promises being made to the customer can be delivered faster and more efficiently, it lowers overall costs for the retailer.

5. Smart Returns Management

2019 will be the year when retailers must begin facing the returns bullet. After years of growth in online orders being returned for free and low or no cost shipping putting increasing pressure on margins, expect to see retailers embracing various approaches this year to try and take back control. Modern order management technology can offer an accurate, real-time view of all network inventory, including inbound and received returns, allowing pioneering merchants to begin looking for ways to leverage what is becoming an ever-increasing source of new supply back into the network, in creative ways. In parallel, by embracing online fitting tools that create accurate sizing measurements, providing better merchandise descriptions and offering free return shipping, retailers can significantly reduce the impact of returns on the bottom line. And do not be surprised to see some merchants begin to explore policy changes to try and take back a little ground in the quest to reduce the negative impact to margins created by a growing segment of the customer base who can be considered serial returners.

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Craig Summers

Craig Summers

Craig Summers is Managing Director, UK at Manhattan Associates. Prior to this he spent time in a variety of senior leadership roles such as Senior Director at Oracle and Enterprise Sales Director at IBM. Craig is an expert in all things customer experience and drove significant change in the Oracle CRM / CX business, transforming its traditional ‘on-premise’ software business into a dynamic, transactional Cloud / SaaS business.

Summers is also an advocate of ‘Authentic Leadership’ and enjoys spending time actively leading people to realise their potential and exceed their goals with a focus on business performance, customer success and operational excellence.