Despite expectations that retailers should invest in tech, inspiring brand love and loyalty still comes down to delivering amazing product.
Thanks to the rise of ratings and reviews systems where people can sound off about their purchases and experiences, consumers are primed to offer their opinion and expect their feedback to make a difference. In fact, two-thirds (66 percent) of those surveyed for a MakerSights report agreed that they’d want more ways to share insights and feedback with their favorite brands. Turns out that not only do people want to help brands develop better products but 75 percent also said being included in co-creation would influence their purchasing decisions as well as their brand loyalty. That’s significant, given the 49 percent of consumers whose annual spending on clothing, shoes and accessories runs between $250 and $1,000.
On top of that, there’s a growing awareness among product stakeholders in fashion that technology can improve speed, processes and outcomes. For its inaugural State of Technology in Retail research, MakerSights, the AI retail product decision platform adopted by the likes of Roots, Allbirds, Levi’s and Madewell, heard from 254 employees clustered at organizations with revenue less than $50 million (37 percent) and or in excess of $1 billion.
They’re employed most commonly as buyers or merchants (31 percent) and designers (20 percent) but people in wholesale functions (18 percent) and product development (13 percent) weighed in, too. Sourcing pros (7 percent) and planners (11 percent) rounded out the survey group, where most (50 percent) work at department stores. More than one-fifth (21 percent) described their employer as a primarily wholesale brand, while the remainder were evenly split between vertical brands (15 percent) and digital natives (14 percent).
Most (70 percent) said sales at their company are seeing a positive upward trend, though for 22 percent sales are flat and the trajectory is downward for 8 percent.
The struggle to bring to market hit products could be among the factors dragging on sales at the companies where growth is flat or declining. Surveyed professionals believe this struggle is their greatest challenge (43 percent), though 40 percent wrestle with managing inventory accurately and pricing strategies plague another 32 percent.
Direct-to-consumer brands are commonly believed to have a data advantage when it comes to knowing their customer preferences, but there’s plenty of room for improvement. Sixty-nine percent of digital natives feel they have a good grip of what consumers want, 12 percent more than the wholesalers who said the same.
Incorporating technology, many believe, is not only a priority within their organizations (61 percent) but another 81 percent say specific tech like artificial intelligence and automation are key to improving their job performance.
Asked where tech would make the greatest impact, 51 percent chose product allocation, ahead of the 44 percent who believe pricing stands to gain from granular tools. The remaining 35 percent see sampling and prototyping as ripe for tech-based disruption, in line with the 46 percent who see 3-D printing as the most “intriguing” tech advancement relative to AI and predictive technologies (40 percent) or fit tech and body scanning (35 percent).
However, survey takers harbor many common concerns regarding technology, and especially automation, in the workplace. One-third worry that tech tools could dilute creativity and a similar number (31 percent) fear they could be automated out of a job.
MakerSights, which competes with First Insight on the decision-making front, just released an update to its AI-powered demand forecasting platform that integrates tightly with retail calendars to better streamline planning processes. This will improve product-focused teams’ access to historical sales data, customer feedback, internal perspectives and other data streams when they’re evaluating new product viability, according to Matt Field, MakerSights president. Clients were seeking better decision making across the full retail calendar, from early stages of assigning dollars.
Some brands use MakerSights to evaluate the majority of their new products while others target specific categories, Field said, explaining that “there’s no right or wrong way” to use the platform as long as the outcome is greater decision confidence.
Field believes retail has been the victim of underinvestment by tech giants but that’s been changing in recent times. Forward-thinking brands, he told Sourcing Journal, “acknowledge that we live in the era of the empowered consumer” and it’s no longer sufficient to dictate to them what will sell when they have more options that ever before. Future winners harbor a “shared appreciation” for the value of actionable data that leads to decision confidence, he added.
To date three-year-old MakerSights has raised $3.1 million. Steve Anderson of Baseline Ventures, an early investor in Instagram and Stitch Fix, has joined the startup’s team of investment partners.