"New formats, new channels, customized offers are top of mind for retailers"

In a response to Dataquest, Lula Mohanty, Vice President, Sectors at GBS-GD, IBM india elaborates major trends shaping the overall e-commerce and retails industry. She also speaks on the subject of technology, the emerging patterns and trends that will change the future of this sector. Edited excerpts...

What is the current scenario of the global retail market?

The scenario is positive overall. Our observation, based on discussions with various clients, is that while organized Retail Sales in mature markets have been fairly flat, due to new ways/channels of shopping overall, Global Retail would grow in the 3 % to 4% range and that, for sure, is a positive sign. The Growth Market Units is where there is additional momentum and action towards organized retail. Small store/niche customized stores catering to specific demographic requirements are expected to out pace the large traditional big box, one-size-fits-all type of stores.

What are the emerging patterns and trends that you think will change the future of this sector?

It's the era of the empowered consumer. He is dictating a new set of terms in the dynamic between buyers and sellers. An empowered consumer is generating an explosion of mobile and social interaction. These customers are empowered by technology and transparency. They expect to engage with companies when and how they want, through physical, digital and mobile means. They want a consistent experience between all channels. They compare notes and instantly share. And they can champion a brand or sully a reputation with the click of a mouse. A trend to observe is the consolidation of some of the Retailers, along with continuous need for in-country Retailers to go Global or partner with global leaders.

What are the key challenges that players in the retail sector face?

Simultaneous to soaring customer expectation, global supply chains have also become increasingly interconnected and complex. New formats, new channels, customized offers are top of mind for retailers. Being prepared to respond to this highly-networked empowered, consumer is the biggest challenge. Keeping pace with technology advancements follows close. Retailers also face challenges from local or in-country regulations as they expand their global foot print.

How is technology playing a role in the growth of the sector? What are the opportunities you observe in the sector?

While there is a lot of data available, making sense of the data available on different channels to help the Retailer in decision making is where technology, consultancy and services come into play. Technology is providing an omni-channel experience to the Customer; it is spawning new ways of Mobile and Web Commerce.

Technology facilitates tools that enable the Supply Chain transparency. For instance, tools that convince the highly-networked, socio-economically savvy consumer that that ‘organic' is truly organic, or the dress or jewelry she bought is not from a country or company that does not comply with child labor laws and so on.

Technology also enables sustainability initiatives like waste prevention, coupons and catalogs by email.

How do you engage with global clients, i.e tell us more about your offshore consultancy services?

We focus on helping our clients respond to the empowered consumer's needs, navigate the changes needed and capitalize on increasing complexity. We leverage our rich assets & innovation. Our focus on industry-based research and innovation dates way back to the days of the bar code which we know is the defacto standard. Industry-leading solutions-honed through multiple implementations-enable greater predictability of business outcomes. Our consulting is linked to implementation.

By building our strategies and methodologies around real implementation experience, we are able to consistently and successfully execute on the advice we provide to our clients. We can offer capabilities that are not inhibited by borders. Global, local and on-site expertise, managed by a common governance framework, enables our clients to grow strategically, mitigating risks and meeting changing market requirements

What are the advantages and challenges of the same?

It enables retailers to provide targeted offers and focus on increasing customer loyalty and wallet share. On the flip side is the continuous need to prepare and respond to new and emerging technologies.

What is IBM currently doing in the global retail space?

As mentioned earlier, IBM in Retail dates back to the days of the Bar code...UPC code. We are effectively leveraging our R&D along with consulting linked to implementation to set foot on a several First of a Kind Projects with our Global Retailers on new initiatives.

With our global presence in 176 countries, along with our refined and tested Globally Integrated Enterprise (GIE) strategy, we are enabling retailers to effectively set foot on the GIE journey themselves.