Innovation in Retail

One may wonder what is the common link between Sears,WalMart,7 Eleven,JCPenney and Woolworth except for  retailing.What makes them globally acceptable and hugely successful ventures?

The answer lies in their determination to innovate constantly,revolutionize the retailing industry and bring about drastic changes in consumer behavior, reinventing and reinstating the rules of the gamble called Retailing. Significant and rapid demographic, economic, social and technological shifts are creating a fertile environment for new ideas to better serve customers, steal market share and re-invent entire industries.

We have learnt in our books that products and businesses have a life cycle(consisting of introduction,growth,maturity and decline phases) and the gamble is to keep the product equally enchanting to the customer even after years of use and to prevent prototypes of the same snatching away market share in the later stages of life. For retailers in the maturity phase of their life cycle, innovation is the most important tool for growth rather than organic expansion in the years ahead.

Today’s fast changing consumer behavior,largely due to various new products forcing them to do so, bring about huge opportunities to innovate. In fact one is dependant on the other.

•   Opportunities of innovation can be realized in changing consumer preferences created by demographic, social and economic changes in lifestyle.Catching the wave of opportunity at the right time can give huge impetus to a retail.
•   Customer focussed approach leads to value add to a customer shopping experience. Hence adding extra services and information to the already existing product creates competitive differentiation.
•   With too many products in the retail,customers today are spoilt for choice and assistance to help them choose the right product to suit their needs can be nothing better that adding value symbiotically. Allowing shoppers to sample the merchandise before buying, utilizing on-demand information kiosks, partnering with celebrities to provide a seal of approval and creating online communities provide consumers the help they need.
•   Consumers want it fast; they want it now; and, they want it first. The need for speed in the shopping process will continue to drive changes in store concepts, design, location, merchandising, transaction processing and payment. This provides a unique opportunity to innovate.
•   Social networking is the say today.Making products easily available to the customer,providing them information abundantly in various social platforms fosters common interest amongst buyers.discussion forums and blogs can help as a merchandising platforms.
•   Mass customization and personalization not only bring consumers close to retailers but also help build brand loyalty.

In the past few decades, most retail innovations focused primarily on efficiency in response to mass market opportunities. While ongoing innovations in technology and operating strategies will continue to improve efficiency retail innovations have become more customer-centric and will continue to do so.The day is not far when individual attention will be given to customers for the sole reason that customers are the life blood of Retails.After all customer is the king. 


-Indira Nanda
  LIBA-PGDM