Retailers Not Prepared To Manage Their Digital Operations

With the number of digital assets and digital orders growing 24% and 16%, respectively in 2023, research shows that fewer than half of retailers are underprepared to manage the pace and complexity of their digital operations 

Incisiv, a next-generation industry insights firm that helps retailers and brands navigate digital disruption,  announced the findings of an executive survey titled Digital Complexity: Thriving in Unpredictable Times. The survey, conducted in partnership with Fluent Commerce, commerce tools, and Contentstack, found that retailers expect major increases in operational requirements around fulfillment and digital-related functions in 2023. 

With the pace and complexity of operations in digital retail rising rapidly, most brands feel inadequately prepared to deal with these new challenges. The survey also found that fewer than half of retailers believe they can effectively manage all aspects of their digital operations over the next twelve months. 

“As digital demand regresses to the mean, and with increasing macroeconomic uncertainty, the fight for the shopper dollar will intensify over the next 12 months. Delivering on the fundamentals of inventory availability and anywhere fulfillment is critical and there is still a lot of work to be done in this area. Building a personalized and relevant shopper experience is where the leaders are focused,” said Gaurav Pant, Chief Insights Officer, Incisiv. 

To adapt accordingly, retailers need to focus on the capabilities that impact them the most and must upgrade omnichannel capabilities, specifically in areas of digital fulfillment, content management, and personalization. 

Key findings of the research include: 

  • ● Retailers expect the complexity of their digital operations to increase over the next 12 months:
    81% of retailers expect their product returns to increase 

    •  69% of retailers will increase their online SKUs 
    •  67% of retailers will increase the number of digital assets they utilize 
    •  65% of retailers expect the number of store fulfilled digital orders to increase 
  • Most are underprepared to effectively manage them: 
  •  46% of retailers stated they will be effective in managing the growth of their product returns 
  •  43% of retailers stated they will be effective in managing their online SKU growth
  • 32% of retailers stated they will be effective in managing the variety of their digital assets. 
  •  35% of retailers stated they will be effective in managing their store order fulfillment 

 Retailers were forced to invest in commerce and fulfillment capabilities during the pandemic just to stay in business. Content and campaign management was given far less attention and now retailers must catch up. For instance: 

  • 39% of retailers stated their current store fulfillment platform will not meet their needs
  •  40% of retailers stated their personalization platform won’t meet their needs
  • 42% retailers stated their product catalog system won’t meet their needs
  • 43% of retailers stated their content management system won’t meet their needs

“The stark reality of ecommerce marketing is that content is non-negotiable: to win and hold customer attention, content must be everywhere, and it must always be evolving,” added Neha Sampat, CEO, Contentstack. “Marketers need tools that support this reality, such as MACH-based technology that sets marketing departments up for speed, freeing teams from dependency on IT, and enabling agile, collaborative, and scalable processes.” 

Jamie Cairns, Chief Strategy Officer, Fluent Commerce, stated “In regards to fulfillment, two of the main challenges include inventory accuracy and fulfillment optimization. What is the most effective way to solve both issues? With an order management system—one that is MACH-based, offers flexible fulfillment logic and workflows. Second, retailers need to have the ability to provide an accurate, near real-time view of inventory at scale.” 

“There’s more to running a successful business than just ensuring you’re two steps ahead of having the products consumers want and need. They need the flexibility and scalability to provide the experiences customers want today, and tomorrow” said Michael Scholz, Vice President of Product & Customer Marketing, commercetools. “Retailers need an agile and flexible commerce portfolio and an ecosystem of best-of-breed technology, such as MACH (Microservices, API-First, Cloud-Native and Headless) solutions. These enable businesses to unlock infinite opportunities, effectively tackle these new challenges and future-proof their business against changing market forces.”