IT courses for retailers: What should retailers be thinking about in the future?

Why the retail industry should use IT

Although the domestic retail industry is not in a major recession, the future is uncertain due to factors such as the declining birthrate, aging population, and tax hikes. In addition to the market size of the industry itself, its business format has changed significantly over time. From the former department stores to supermarkets, specialty stores such as home appliances and pharmaceuticals have emerged, and in recent years, convenience stores have become widespread, and online sales have become firmly established as a part of daily life. However, in recent years, IT and digital support has become essential, regardless of business type or sales scale. Cashless payments are now becoming commonplace even in small stores .

Here, we will discuss the reasons why the current retail industry should utilize IT. First, let’s summarize the challenges faced by the industry and the problems that can be solved.

Environmental factors surrounding stores

The challenges facing the retail industry can be broadly divided into two: environmental factors surrounding stores and management issues within stores.

The first environmental factor is the shrinking domestic market. Although the size of the domestic retail market currently remains at a plateau, the number of customers is expected to decline in the future as the total population declines. Competition will naturally intensify as vendors compete for a smaller pie. In such a situation, it would be a big negative if your store lags behind other stores in terms of IT services and management improvements that utilize IT.

Furthermore, even though the population is aging, the number of people who have become familiar with IT devices during their working lives is increasing. Unlike the elderly in the past, there will be more cases in which being digitally compatible will have a positive effect.
On the other hand, the decline in the working population due to the declining birthrate and aging population is creating a labor shortage, which is already becoming a social problem. Since the retail industry involves a lot of customer service work, a decline in the quality of human resources will immediately affect store profits. In addition, raising the conditions for recruitment will increase personnel costs.

Management issues within the store

Next, let’s touch on the problems within the store. Shoplifting is something you need to be very wary of at stores. Shoplifting incidents involving elderly people have become particularly prominent recently. Considering the effects of the aging population, this cannot be ignored, and it becomes necessary to devise ways to prevent crime.

Inventory management and turnover are also important in the retail industry. Too much inventory creates waste. If it’s too low, you’ll miss out on sales opportunities. In order to manage this properly and not waste unnecessary time, it is essential to utilize IT.

On the other hand, the most unfortunate situation that affects turnover and sales is the formation of lines at the checkout counter. If you wait in line for a long time, customers will be dissatisfied, and if people stop buying after seeing the line, you will lose sales opportunities. Also, as mentioned earlier, when it becomes difficult to acquire human resources, it becomes difficult to maintain the quality of customer service.
To overcome these challenges, it is desirable to use tablets and other devices to provide sales support that allows anyone to provide a certain level of quality service. Going one step further, various IT applications can be considered, such as customer service robots equipped with AI and systems that explain products using touch panels.

Initiatives to improve operational efficiency using IT

Next, let’s take a look at streamlining things like the back office. IT is also very effective in office work, sales, meetings, etc.

Increase meeting efficiency

The inefficiency of Japanese meetings is an issue that is often pointed out. In addition to the direct costs of transporting members and using conference rooms, holding a meeting also incurs costs that are difficult to notice, such as the time required to prepare materials and printing costs. One way to solve these issues is to use IT for meetings. First, if your attendees are in remote locations, host a video conference to reduce travel time and expense. Additionally, by viewing meeting materials on a laptop or tablet, you can reduce the cost of paper usage. If materials are converted into data, past materials can be searched and viewed immediately.

Increase sales efficiency

Sales is also a job that requires time and money due to travel and business negotiations. Moreover, if it does not lead to an order, it will be wasted, and if the project is ongoing, you want to reduce the time and number of times as much as possible. Especially when dealing with many products in a retail business, it is difficult to carry all the information around on paper. You are also required to quickly check inventory on the go. Due to these circumstances, it is necessary to convert all product information and inventory into data so that it can be searched instantly on a tablet or other device.

Increase the efficiency of information sharing

When multiple departments or members are involved in daily operations, sharing information is essential. Utilizing IT will also be essential for coordinating dates and times for frequent meetings. However, it is fine if you are in an environment where you can meet face-to-face on a regular basis, but if that is not the case, you will have to share information online.

E-mail is often used in such cases, but e-mail has its drawbacks, such as the difficulty of tracing past messages and the need to add CC when sending the same information to multiple people. When sharing information within the company, it is advantageous to use the chat and group functions of internal SNS, which can reduce the amount of time and effort required for communication.

Increase office efficiency

Even if you just call it office work, its scope is extremely wide, and IT is useful in every aspect. For example, when organizing staff shifts, if you manage them on paper, it is difficult to make adjustments when changes occur. Even if the shifts themselves are managed on a computer, if each person in charge does not reflect the changes immediately or neglects to confirm them, it takes time and effort. Therefore, by making it possible for anyone to check and make corrections from a smartphone, etc., and by issuing regular confirmation instructions, missed shifts and omissions can be alleviated, and changes can be easily reflected.

Although this also leads to information sharing, it is important that important data is not stored on a specific individual’s computer, but stored on a server or common business system so that anyone can view it at any time. . At the same time, make sure to maintain strict security so that only those involved can see it.

Marketing strategies for the retail industry using IT

IT is not just for direct operations. It can also be used as a marketing weapon to increase sales. Here, let’s take a look at digital marketing that utilizes IT.

Let’s create a system to sell with digital marketing

Marketing means conveying the value of a brand or product to the market, listening to the market’s voice, and creating a system that allows the product to sell without the need for sales. Traditionally, this has required costly advertising and labor costs for market research. However, digitalization has made it possible to implement measures with low cost and high reliability.

This is called digital marketing, and refers to a method of utilizing information and data through many types of channels, including a company’s official website, blogs, email, SNS, apps, and point cards. Digital marketing has become more effective with the spread of smartphones.

Marketing methods to attract customers

SEO

SEO (Search Engine Optimization) has traditionally been considered the most important and royal road. It is a measure to seek inflow traffic from there by displaying your company’s site as high as possible among the candidates that appear according to the keyword searched by the user. The page must contain appropriate keywords and provide the information the user is looking for.

Social media

For example, you can create an official account on SNS, gather followers there, and direct them to your website or campaign site. The key is to create a sense of intimacy by communicating with customers and potential customers.

owned media

It is a web media that publishes the knowledge, experience, know-how, and latest information possessed by companies and brands, and attracts viewers with its interesting content. Include articles introducing products and services, inquiries and download links for materials, etc., to lead to actual purchases.

Listing ads, SNS ads

SEO is a method that aims to display at the top of search results, but listing advertising is a method of displaying your site in an advertising space with a fixed space in search results. Prices are determined by auction for each keyword. Similarly, SNS advertisements display advertisements mixed with SNS posts.

Marketing techniques for contacts

LPO

A landing page is a page that is set as a link destination from an advertisement. The purpose is to lead to product purchases, inquiries, requests for information, etc. LPO (Landing Page Optimization) increases this probability by strongly attracting customers on the first screen, then giving them credibility and good impressions, and finally guiding them to take the desired action.

E.F.O.

EFO (Entry Form Optimization) is a method to reduce the number of people leaving the landing page, input form, cart, etc. on the site. Especially in the case of carts, if someone adds an item but leaves midway through, it will be a loss. The key is to avoid causing stress to users.

Web chat

This is a method of chatting with users in real time on the site and communicating with them as if they were serving customers at a physical store.

Marketing techniques for repeat visits

email marketing

This is a method of sending e-mail newsletters and step-by-step emails to people who have requested information or made purchases, encouraging them to access your website or campaign site. It is important that the information contained is not just information, but is useful to the recipient. If possible, we will customize the content to suit the person’s characteristics.

retargeting ads

Retargeting advertising is based on information about websites you have visited in the past and delivers advertisements in association with those websites. Ads for related sites and services will appear on the screens of people who have previously visited your site, so you can expect them to visit your site again.

How to advance IT management

Although IT is useful for improving business efficiency and marketing, there may be concerns about actually implementing it. However, in the retail industry, it can be said that IT management has no choice but to proceed. Finally, we will introduce how to proceed with IT implementation and the expected effects for each type of question or anxiety that the person in charge has.

Isn’t IT unrelated to management?

If you are the type of person who believes that decisions based on intuition are important in management and have nothing to do with IT, you may be reluctant to adopt IT. However, management involves competition with other companies and responding to the environment. You are required to always keep up with the latest business conditions and take the best possible action. For this purpose, it is important to convert management-related matters into data so that it can be analyzed freely. If you look at the IT and cashless policies that the government is promoting, and the market where smartphones are becoming more popular year by year, it would be hard to say that IT has nothing to do with business management. Furthermore, as mentioned earlier, IT implementation such as video conferencing and document sharing directly leads to improved management efficiency.

Where should I start?

If you’re the type of person who doesn’t know where to start, start with the part where you can expect the most results. To do this, first try to find out what the problem is in your company. Clarify your company’s strengths and weaknesses, what you are aiming for, and your vision, and recognize the gaps between them. Based on the issues that emerge, we think about how they can be solved using IT.

Can’t you see the effect of your investment?

Isn’t it possible to increase profits even with IT? Regarding this question, we will make and compare future predictions for the case where we do not implement IT and the case where we implement IT, and we will consider the difference between them. The key here is to calculate not only cost savings, but also new profits. Don’t forget the cost of implementing IT. There are limits to increasing profits through cost reductions and efficiency improvements alone. Please make sure to draw a story that will make you money.

No human resources with IT knowledge

The shortage of IT human resources is a problem throughout Japan. The questions we have introduced so far, such as “Where should I start?” and “What is the return on investment?” cannot be determined without human resources. If your company doesn’t have people who are knowledgeable about IT, you may want to train them through external training, hire new people, or consult an IT consultant. In any case, it is necessary for the future to secure IT personnel who can be consulted and requested on a daily basis.

I am reluctant to implement IT because it costs money.

Focusing only on immediate costs is not a good idea in the long run. IT is progressing day by day, and it is a field that changes so quickly that the situation can change drastically in just one year. If you want to keep the initial investment as low as possible, you can also use cloud services. Many of them are free or, even if paid, are available at a very low price if the scale is small.

summary

Regardless of the industry, there is a growing need for IT in both stores and back office operations. The rapid pace of IT adoption is no exception to the retail industry. In fact, it can be said that the retail industry has the potential for growth due to the introduction of IT. Please do not miss out on this trend, including training and securing human resources.

Microsoft is promoting “Intelligent Retail” through intelligent cloud and edge technology for the digital transformation of the distribution industry by “understanding the customer,” “empowering employees,” and “providing an intelligent supply chain . “ We are working to realize the themes of “re-creating the distribution business.” Based on these themes, we work with partner companies to support the realization of digital transformation specialized in the distribution and retail industry. Please check the “Intelligent Retail Solution Guide” for details.