Gerald Heath, commerce practice principal, at OLR Retail examines how medium sized retailers benefit from implementing cloud-based services.
Technology provides a competitive advantage, and no more so than in the retail space where it has levelled the playing field.
A desirable product proposition coupled with a scalable platform has allowed even the smallest of start-ups to go head-to-head with established big brands, leading to a rise in medium sized businesses. Research from Grant Thornton suggests UK medium sized businesses are set to grow by a further 6.7% in 2015 and could add an extra £50 billion to the UK economy this year.
But in spite of this rosy outlook, emerging retailers face a double edged sword when it comes to achieving growth. While their size makes them more agile, continuing to grow and compete effectively in a more demanding, connected and crowded marketplace is no easy feat. In fact, there is plenty of evidence to suggest that most eCommerce businesses stop growing and indeed fail altogether – with failure rates reported to be as high as 97%. For many retailers getting over the growth wobble is the hardest task.
To grow successfully, these retailers must underpin their operations with retail systems that can grow with them, precisely the advantage of running commerce in the cloud.
A commerce cloud system has the ability to accelerate at the same pace as the retailer, meaning the technology will always remain up to date, so they can overcome their growth wobbles quicker. This will be particularly beneficial if an e-tailer is looking to adopt a multichannel approach, expanding into physical stores, as the data stored within the technology can be accessed from multiple locations. This will enable a single view of the business which can help them manage inventory and the supply chain more effectively.
A cloud commerce solution not only enables the retailer to scale but it can also support them by allowing them to capitalise on ‘burst capacity’ to take advantage of peaks in seasonal demand via rapid store rollout.
Similarly, rapid deployment in new territories is important for growth and to steal market share from competitors. This can be achieved through crafted templates which can be replicated in multiple geographies. Through software-as-a-service (SaaS) functions, rapid storefront enablement and rollout means retailers can quickly define product catalogues, enable checkout, search and merchandise products, author content pages and target customers with promotions.
So as mid-market retailers seek to grow, cloud based solutions offer the scalability and flexibility to take them to the next level.