BrazilHow Argon helps luxury retailers with omnichannel strategy and operations
Global consultancy Argon & Co has helped clients around the world break through with successful e-commerce and omnichannel strategies in the luxury retail space. To find our more about the firm’s track record in the Middle East, we spoke with managing partner Stefan Westdijk and consultant Bouchra Ghrayyeb.
Transformation is key for the future of retail players that are hoping to stay afloat in the tides of change. From digital transformation to procurement strategies, supply chains to store operations, there are many important factors that retailers need to get right.
One increasingly important area for retail is omnichannel strategy. This refers to a seamless and integrated customer experience across multiple channels, like online stores, physical stores, and mobile apps. It ensures that customers can interact with a brand consistently and smoothly, regardless of the platform or device they use.
“Our primary focus areas in the luxury space are e-commerce and omnichannel strategy. We work closely with luxury brands to navigate the complexities of digital transformation, particularly in enhancing their e-commerce logistics, supply chain management, and omnichannel operations,” said Westdijk.
“Our goal is to ensure that luxury brands can provide seamless and personalized customer experiences across all platforms, which is increasingly crucial in today’s market.”
The online driver
E-commerce is largely seen as the only space in retail that is currently driving sales, with the rest of the industry struggling. For the last two years, brick-and-mortar sales have stagnated, never really managing to sustain healthy growth after the difficult period during the pandemic.
For that reason, in order to hit their targets, retail players must have a bulletproof digitalization strategy in place. Retailers need to aim for engaging online experiences that translate to sales, especially in the luxury space, though shifting to ecommerce is not a silver bullet and omnichannel strategies should be holistic.
Luxury retail has proven to be a very strong subcategory in the Middle East, among other places like China. One estimate projected that the Middle Eastern luxury goods market could double in size by 2030, much of that driven by online sales.
“We have worked with a well-known luxury brand that aimed to redefine its e-commerce logistics requirements and review its distribution model,” said Westdijk.
“The project involved synthesizing current and future logistics volumes, formalizing logistics requirements such as inventory and quality control, and benchmarking costs and services against market practices. Our recommendations led to improved storage and volume forecasts, ultimately enhancing the overall efficiency of their logistics operations.”
Adopting innovative tech – which is clearly a major part of omnichannel strategy and the overall digitalization process – will be a major trend for luxury brands going forward. For example, AI and machine learning will play a part in creating highly personalized online shopping experiences.
“AI is able to analyze customer data to offer tailored recommendations and services, crucial for differentiation in the luxury market,” said Ghrayyeb.
“Omnichannel integration with IoT (Internet of Things) technology ensures seamless integration of online and offline channels, allowing luxury brands to deliver consistent and personalized experiences across all customer touchpoints, whether online or in-store.”
Similar innovative technology, like advanced analytics tools, will help companies optimize their supply chains by using real-time tracking of inventory and shipments, which can be a game changer. This can help teams understand which products are available when needed and improves customer satisfaction.
“The retail industry is undergoing unprecedented change worldwide. The last decade has seen the rapid growth of e-commerce pure players, which have very different cost structures to traditional players,” said Westdijk.
“With rising consumer expectations and pressures, digital initiatives are necessary to transform the customer experience, develop consumer insight, and evolve supply chain management, sales forecasting, price management, promotions, and store operations.”
