The following guest article has been written for Business Leader by Derek O’Carroll, CEO, Brightpearl.
Have you ever found yourself browsing Netflix in search of the TV show or film that fits perfectly with your mood? Even with nothing at stake, it’s often difficult to decide what to watch.
We’re so overwhelmed by the plethora of options that we end up paralysed – unable to get up off the sofa, but not willing to commit to an hour of viewing time because it might not be the correct choice.
This happens in other aspects of our lives too, pairing a tie with a shirt, deciding on a particular flavour of ice cream, choice is difficult. Twenty years ago psychologists Sheena Iyengar and Mark Lepper conducted a study to determine if a wider array of choice led to an increase in sales.
They set up two jam tasting booths at a grocery store, one offering only 6 flavours, the other offering 24. The results showed that those presented with the choice of 6 products were 10 times more likely to buy than those with 24 on offer.
So, when it comes to television shows and jam flavours, a surplus of choice may lead to an inability to make a decision.
Too much retail choice
Now consider that you’re the owner of a retail store, looking to make a significant investment in technology for your business. This decision has huge ramifications and you have very little time as the market moves so fast.
There are also more than a hundred solutions and technology partners available in any given area – from payments, to delivery, and from email marketing to your ecommerce storefront.
It’s no wonder then that a recent Retail Tech Stack Report found that 41% of businesses simply abstained from making a technology investment last year due to too much choice. Not only that, but 51% of retailers cited that they did not have the time or expertise to confidently select a technology vendor.
Decision making paralysis is a dangerous thing for retailers, particularly in the current climate which is forcing the adoption of new business models in order for merchants to thrive.
Those who failed to make the correct technology investment last year have found themselves ill prepared for the massive shift to online shopping over the past four months, and consequently, many have been forced to close temporarily, or worse, fold altogether.
Even household brands such as Primark and B&Q were caught out by their inability to sell online and ship products Direct to Consumer, and have been reporting massive losses, while scores of independent fashion boutiques without any infrastructure in place for an ecommerce store have also gone under.
Thriving online retail
However, there are notable examples of brands who have been able to pivot online and thrive during the pandemic – because of their previous investment in agile technology platforms that support multichannel commerce. Since lockdown began Hair & Beauty company CoolBlades have seen an incredible 650% increase in sales, compared to the same time last year.
They attribute much of their success to the firm’s ability to handle the exponential rate of demand, on account of its investment in a digital operations platform that allowed the team to manage thousands of orders across multiple online channels without missing a step. Without the right technology the brand claims that like many others it would have had to close its doors during lockdown.
Covid has taught us a number of lessons, including that the correct technology can prepare retailers for any eventuality, but a lack of investment can be a deathknell to brands.
The C19 crisis is forcing retailers to act much more quickly than they normally would and entering into technology partnerships will become increasingly common.
A quick glance at Shopify’s recent sales surge shows some merchants are rapidly adapting operations to survive the coronavirus. In the post-lockdown landscape, it’s vital that brands make considered decisions with a view to the long-term.
In an era of rapid change, flexible, quick to deploy technology stacks that can support multi-channel commerce will be vital for brands to respond quickly to drastic flux in their environment, including the potential for a second wave of the virus.
Navigating the post-coronavirus landscape will be a complex time for retailers, but the one thing they can no longer afford to do is be paralysed by choice. The time for action is now.