The ‘Unified Retailing’ business model

Ali Athar

We have been working with retailers for over 30 years. In the recent past, we have seen the emergence of the ‘Amazons’ and how they have taken market share away from traditional retailers, who are now hurting.

The traditional retail business model needs to change. It was developed in the 1970s and was extremely category/product centric. Driven by the then-modern techniques of ‘merchandising’, it blossomed and succeeded in creating the national chains we all know today. But it is no longer competitive.

Online retailing started in 2001 and has grown exponentially. In response, many traditional retailers set up online silos – initially to learn and then to compete. In 2007, retailers started trying to integrate the two silos through the principles of multi-channel retailing. But that has proven expensive as it has layered increasing costs onto an old and out-of-date business model.

It has not succeeded in stemming the flow, growth and popularity of the ‘Amazons’.

Our proposal is a new approach we are calling ‘Unified Retailing’ which, we believe, will help traditional retailers accelerate performance in the digital era and compete more effectively with the ‘Amazons’.

Why ‘Unified Retailing’?

Online retailers started in specific product categories but, unconstrained by space, they have seen their range footprints increase dramatically. Today, they have become more and more customer centric. Their customer-centric business models (led by marketing and engagement through social media) and processes are completely different to traditional retailing business models. And they are winning.

Unified Retailing brings these two models together. A retailer’s brand identity is clearly still determined by product excellence. But we think its operating model in the future needs to be much more customer-centric.

Moving to a Unified Retailing business model delivers significant sales uplifts, stock reductions and cost reductions, potentially doubling profits.

The 5 Pillars of Unified Retailing

The new Unified Retailing business model has 5 key pillars on which it needs to be built.

Unified Commerce - Unified Retailing Pillar 1

Unified Commerce Platform

A single sales platform that supports all customer touch-points and channels.

  • Single view of customer, product and stock
  • Single cross-channel, customer-centric marketing engine
  • Clienteling for VIP customers – proactive customer engagement
  • Mobile consumer app linked to store staff – engagement beyond the store
Customer centricity - Unified Retailing Pillar 2

Customer Centricity

Putting the customer at the centre of all operations and decisions.

  • Seamless and unified omni-channel customer journeys
  • Recognition of two categories of customer – VIP and casual
  • Single marketing engine for promotions, vouchers and loyalty
  • Personalised curated offerings and ranges
  • Creation of events in support of channels
  • Localisation
  • Engagement via social media
Price Optimisation - Unified Retailing Pillar 3

Price Optimisation

Intelligent pricing strategies that optimise margins without impacting price perception.

  • Competitive pricing strategies
  • Price, promotions and markdown management
  • Margin optimisation
Order management and Stock optimisation -  Unified Retailing Pillar 4

Stock Optimisation and Order Management

Reducing stock investment without impacting sales and utilising it efficiently to meet customer demand.

  • Reduction in stock (including display-only stock and supplier stock)
  • Routing orders to the stock
  • Despatch from store
  • 30-minute click and collect
  • Hub-and-Spoke stores
  • Minimisation of markdowns
Unified Supply Chain - Unified Retailing Pillar 5

Unified Supply Chain

A more closely linked supply chain that brings efficiency and increases uniqueness through collaboration.

  • Increased vertical integration
  • Digital supply chain from purchase to pay
  • Increased supplier collaboration
  • Cost optimisation and better deal management

>> Contact us for 30-minute presentation on How to Achieve Unified Retailing
>> View our complete Unified Retailing platform 

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