B-t-s Holds Opportunities, but Retailers Also Face Hurdles
Retail analysts and the National Retail Federation are pegging this back-to-school and college shopping seasons to be one of the strongest on record. But industry observers and solution providers are noting that robust sales also come with challenges.
JoAnn Martin, vice president of JDA Software’s retail industry strategy team, expects consumer spending for the b-t-s season to “reach new heights” but anticipates “competition to be fierce for retailers.”
Here, Martin discusses the factors influencing the retail landscape and shared her predictions for the shopping season.
WWD: How are top retailers preparing for b-t-s 2018 — from inventory to staffing?
JoAnn Martin: Unemployment in May of 2018 was at 3.9 percent, the lowest it has been since 2000. Retailers are feeling the tightening of the job market and, as a result, you have retailers such as Kohl’s and J.C. Penney already advertising seasonal hiring for not only the back-to-school period, but also holiday 2018.
They are fighting for talent and hiring further out than they have in the past to secure that talent. According to the 2018 NRF back-to-school survey, most b-t-s shoppers, or 77 percent, plan to start at least three weeks before school begins, up from last year’s 74 percent. Retailers will be anticipating the demand and building inventories to meet this need.
WWD: What obstacles might retailers have to overcome for the b-t-s shopping season?
J.M.: Retailers are facing a more diverse competitive landscape than in years past. They have formidable competition, challenging traditional retailers from avenues such as subscription services, delivering hyper-personalized experiences and assortments, to auto-replenishment services, that are direct-to-consumer, to social sites.
Gone are the days of in-store-only promotions; online retail is multifaceted and requires more predictive supply chains to meet the needs of the changing consumers. Of course, there is no match for the mega marketplaces like Amazon, Alibaba and even Walmart for retailers. However, retailers will be looking for ways to differentiate their product offering with exclusive items while promoting commodity items to acquire customer loyalty on future orders for repeatable purchases such as computer paper.
WWD: What are b-t-s shoppers looking for, in terms of their online and in-store experiences, this year?
J.M.: The customer will continue to seek out convenience when purchasing. Expectations of free shipping and “buy online, pick up in store” will be a price of admission for many retailers. Customers are looking for a frictionless experience in peak times like these and they will profess their loyalty to those retailers who can deliver the experience.
WWD: How can retailers deliver on these experiences for the b-t-s shopping season and beyond?
J.M.: Having the right product, in the right place, and at the right time is the only way to deliver the personalized experience many retailers are looking to maintain. Retailers that can provide inventory visibility to their associates through the latest technologies such as the Internet of Things visibility or through anticipating customer needs and personalized assortment expectations through artificial intelligence and machine learning will be winners. Ultimately, satisfying the customer demand through managing product stock levels at size and color will be a differentiator for the customer experience and will resonate with consumers.
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