As omnichannel retailing evolves and consumer behaviors shift in ways that put greater pressure on retailers and brands, tech companies such as Aptos are rolling out more robust platforms that integrate processes via unified commerce, which replaces the single-point solutions of the past.
Here, Nikki Baird, vice president of strategy at Aptos, talks about unified commerce and how retailers and brands are leveraging it to drive conversions and smooth out the shopping experience.
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WWD: What were some of the main themes for Aptos at the NRF show?
Nikki Baird: The main theme was around unified commerce and that it is more than just selling. It also involves the inventory side of retail. We must look at the product side of the house and the customer side of the house. You can have the best customers in the world, but if you don’t have products to sell them, you’re not going to be successful.
And the reverse is true as well.
You can have the greatest products in the world, but if you can’t find customers to buy them, then you’re not going to be successful. So, our announcements at NRF focused on where we’ve been making progress around that vision of unified commerce.
We talked about store inventory management, a new solution on the Aptos One platform, and how it’s a universal service. Our first solution on the Aptos One platform was point of sale. And we’ve been working hard on building out those capabilities to really offer the depth of point of sale that retailers expect in modern retailing these days.
Part of the reason retailers have a lot of challenges with their IT is that they have solutions that were built in a single-channel world and they’re trying to integrate them and make them all work together. What they really need to do is take capabilities that are used commonly across solutions and transition those into universal services that can serve as the single source of truth across various applications.
SIM and our Universal Promotions Manager are examples of two solutions that we’ve built on Aptos One that bring to life the value of universal services.
WWD: How would you describe the value proposition of unified commerce?
N.B.: Retailers must be able to capture every customer no matter how they interact with their brand. And retailers must be able to match demand to their inventory, wherever it might be.
Across all different kinds of retailers, I think there’s a general understanding that if you don’t have everything connected behind the scenes, you can make mistakes or sub-optimize in ways that make you lose money fast.
As we learned with order management and order splits, you want to be able to access the inventory in stores and then be able to connect online consumers to that inventory. But if a shopper has a multiline basket online, and you’re shipping one thing from this store and one thing from that store and one thing from another store, the boxes and shipments just killed all the margin that you had from that sale.
Retailers want to do what’s right for the customer, but this shouldn’t come at the expense of profitability. That’s why unified commerce — and having your backend and front-end processes in sync — is so important.
WWD: What about returns?
N.B.: We see a lot of emphasis on being able to facilitate the return in-store. Even for retailers that historically were like, “Yeah, we’re not really big on omnichannel,” now they’re like, “OK, we want to do returns in-store as soon as possible.”
There are two things driving this. One is the cost, obviously. With the store as a collection point for returns, you can collect a large quantity of returns and then ship them back in a pallet to the warehouse rather than deal with a lot of partial shipments from consumers direct to the warehouse. I also think there’s added value in that return interaction at the store level — for instance, in terms of quality control and reduction in returns fraud.
The other benefit of returns in-store is the opportunity to turn that refund into at least an exchange, if not an add-on of something else. There’s a good business case for driving in-store returns.
WWD: What was the overall mood like at NRF?
N.B.: It was not clearly good or clearly bad. The holiday shopping season, I think, was slightly better than expected, but that slightly better was not enough to unleash jubilance at NRF. There was some weariness in waiting – like, “I just can’t wait for the economy and consumer spending to get very predictable before I can invest.” We had lots of conversations with retailers that have been sitting on the fence for a while who were like, “This is the year. I can’t put off tech investments any longer. 2024 is decision time.”
WWD: What are the challenges and opportunities facing apparel and footwear as we navigate 2024?
N.B.: As I mentioned earlier, figuring out consumer spending is still up in the air. Every time we think that people are going to stop spending, they don’t. But this is a game of musical chairs, and at some point, the music’s going to stop, and somebody’s going to be left without a chair. We must figure out when that time is going to come.
I’ve heard people talk about things like “revenge spending” as the dominant consumer theme for 2023, and now it’s “wallet detox” and “buckle down and get real” for 2024. Retailers were conservative in their inventory purchases last year — not to the point that they ran out of inventory, but there were a lot of Valentine’s Day items that were out Dec. 26, indicating retailers weren’t dealing with a lot of leftover stock.
WWD: Is this the year for RFID?
N.B.: Yes, especially in fashion. We can have arguments all day long about the RFID use case for cans of peas, but in fashion, it is a no-brainer. The tags are cheap. The readers are getting cheaper. And there’s a lot of merchandise that’s coming to retailers already tagged by the brands. Financially, RFID adoption is a much smaller jump than it used to be, and the business case is just as strong — if not stronger.
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