It started out with 4 pillars (or 4P's): Product, Promotion, Price and Place. People did not count for much back then. In early 1980's with the revolution in management fuelled by such publications as "In Search of Excellence", "Re-inventing the Corporation" and many others, suddenly people woke up to the importance of people and added that to the retail arsenal. We're now able to talk about the 5th pillar of Retail; People.
I believe a strong contribution from all pillars of Retail is necessary to achieve the success that any retailer strives for. I have seen many examples of failed businesses when they neglect to keep an eye on all the pillars or prefer to focus on one more so than the others.
The objective of this short article is not to get into the nitty gritty of how we should be looking after all the pillars. What I want to do, though, is to announce yet another and very powerful pillar of Retail. We call it the "Pixel" to remain in compliance with the "P" convention. It stands for technology. Now, we talk about 6P's of Retail.
Increasingly, technology is playing ever more influential role in retail success. Information Systems, starting with customer records, inventory control, loss prevention, supply chain, workforce management and business intelligence changing the efficiency and effectiveness of retail operations to a point where retailers who do not embrace the technology move to the forefront of businesses that are doomed to fail. Please acknowledge and embrace technology as one of the pillars of retail and view it as something that will help your profitability and overall success of your business.
Balancing the pillars
Too much attention focused on one pillar creates an imbalance. Think of the three-legged chair - remove one of those legs and the chair falls over. Retail businesses must have a balanced approach to all areas of their business. Failure to focus on all pillars with a balanced approach causes the business to 'fall over' or fail to reach its potential.
Increase sales and decrease costs
To conclude, technology today is an essential part of the retail strategy because it helps not only to increase sales but also to decrease costs. Technology is a new tool for retailers to create better customer experiences, develop pools of customer data and better manage stock. Though all 6 pillars should be cared for, technology is the one bringing headaches to retailers. Technology is embedded in our life in such a way that using it is inevitable. Take Facebook for example, I have a friend that is still resisting the Facebook movement. So many times he was in a situation of disadvantage, whether at university or now at work, did he miss out on certain information or could not participate in the conversation. Well technology in retail is essentially the same. You can resist the changes and miss out on opportunities or you can slowly integrate it in your strategy.
You do not have to learn about all the technology available today but you must start monitoring it in the same way that a sport store monitors games, and would have bought more football jerseys in preparation for the State of Origin.
A recent retail chains study by Retail Technologies Inc., found that 52% of mid-sized retailers stated that one of their biggest challenges was keeping up with changing new technology; 46% of larger retailers also faced issues trying to keep up with technology changes. OK, so technology is essential to stay competitive but how do you find places on your "to do list" to add yet another chore? How do retailers keep up to date with new retail technology? This is the subject of another article; it will explain the strategies that can be used and the resources available to help you monitor technology. Click here to read it.
Matt Parmaks is a senior consultant and EVP with DMSRetail ( http://www.dmsretail.com). He is the author of numerous management and retail related books and articles. You can reach him at [mailto:firstname.lastname@example.org]email@example.com
SUBSCRIBE TO SI eNEWS to receive monthly, tips, trends and news about the Retail Industry as well as discounts and promotions from SI Retail