The evolving retail space provides an exceptional opportunity for organizations that are prepared to rise to shopper expectations, but getting there alone is nearly impossible. Today’s shoppers are more demanding than ever before, with the assumption that all shopping platforms are completely synced at all times. When’s the last time you checked inventory for a favorite store online, reserved an item that you needed for store pickup, and then grabbed it on the way home? This scenario will only continue to grow in regularity, with 44% of smartphone users expecting retailers to allow inventory checks on their mobile phone. A single organization would struggle to provide all of the technology that shoppers require, but leveraging partnerships in a collaborative retail environment allows retailers to ultimately outpace the competition.
Collaboration: Key to Successful Retail Environment
One of the challenges that CPG brands are citing in working with retailers is their inability or unwillingness to implement new technology as a method of positioning their products in the store and activating shoppers before their attention wanders. CPG brands such as PepsiCo are finding themselves working less with store merchandising teams and more often with operations and technology groups to ensure that store infrastructure will support their needs. Some CPG brands are willing to bring tech to the stores themselves, especially when actionable insights from shoppers is part of the package offering. Retail technology is truly ripe for innovation, particularly in terms of specific implementations such as shoppable video. Retail gurus recently met at NRF 2018 to vision-cast what the future of retail will be beyond 2018 — and collaboration between retailers and brands continues to top the charts of ways to grow buzz and connect with consumers.
Partners Make Collaboration Successful
One of the world’s largest retailers detailed why collaboration is so important to them. Walmart is a firm believer in working closely with brands to provide an exceptional shopper experience which brings people back in droves. Their 2014 initiative with The Campbell Soup Company brought new focus to sustainability by actively measuring the impact that the Campbell’s initiative was having on the environment. This data then fed into Walmart’s metrics around collaborating with suppliers to reduce 20 million metric tons of GHG (greenhouse gases) from its supply chain by the end of 2015. The data was used to raise awareness of the project and shared with other CPG suppliers, many of whom went on to launch a carbon-reducing project of their own.
Leaders at HanesBrands noted that “executive level awareness and support for sustainability, along with customer commitment, including the leadership of Walmart, are promoting continual improvements in cost reduction and initiatives leading to GHG reductions.” By raising this awareness, Walmart has become a lifetime leader in reducing the carbon footprint of its end-to-end supply chain.
Aside from executive support and awareness, partners also provide another valuable takeaway: cost savings. The partnership between Walmart and CDP (formerly known as the Carbon Disclosure Project) included infrastructure and data management — two of the most critical requirements for a successful partnership. As online e-tailers work to upend the relationship between shoppers and their local retailers, it’s more important than ever that retailers form a close data bond with their featured brands. Amazon’s audacious purchase of Whole Foods stores across the nation was a warning that the crossover between online and brick-and-mortar retailers is imminent and inescapable. This points to the requirement that retailers form a closer bond with their customers by providing them with exceptional service. Every interaction between shoppers and retailers should add value to the customer, providing them with information they need to make a buying decision or an upsell.
How Partners Contribute to Success
Granted, not every partner can be Walmart. How do traditional retailers and suppliers come together to form an airtight bond around shoppers to provide exactly what they want, where and when they want it?
The managing director of professional development at the Path to Purchase Institute recently noted that retailers are viewing their relationship with CPG marketers as a “true partnership” that is “more strategic and less transactional.” This speaks to the long-term nature of these partnerships, where retailers and suppliers should be able to come to the table more as partners than as one organization in a position of power. While retailers have been able to demand concessions from suppliers in the past due to their sheer size, retailers are now seeing that suppliers bring a great deal of data-driven value to the table as well. This shift to equalize power is thought to benefit both sides of the equation, but the real winner are the shoppers who gain an improved overall shopping experience.
Shopper Behavior Tracking
It’s only when retailers and brands agree on a holistic view of the shopper that the partnership becomes a true win-win. Shared data allows both parties to follow the shoppers through their winding path to purchase — one that may start at their desk at work, follow through a smartphone while idling in traffic or at the doctor’s office, before ultimately ending at the store several days later. Learning how to attribute the shopper’s path to purchase allows both parties to be smarter marketers and focus efforts where they are paying the greatest dividends. Shoppers expect a true omnichannel experience where information and stock levels are consistent, regardless of the platform accessed: in store, online, or through a mobile app. Retailers are always on the lookout for CPG partners who are willing to extend their brand virtually through media investments, unique product packs, and shopper-exclusive programs.
Together, retailers and suppliers are finding ways to collaborate that benefits both organizations and shoppers. Even with recent upheavals in the retail industry, partnerships continue to add value and new ways to sustain value across the retailing spectrum. These two groups are finding that individually executing actions meant to sustain growth are not as effective as working together in a mutually beneficial and collaborative approach.