Amazon is planning to open its largest retail shops so far, report

Amazon is planning to dramatically expand its brick-and-mortar footprint with the opening of large sites similar to department stores, a report claimed on Thursday, August 19.
The company that made its name with online shopping has in recent years taken a growing interest in physical outlets, opening bookstores, grocery stores, and premises selling its growing range of electronics, among other items.
But a Wall Street Journal report this week says the e-commerce giant is planning to open multiple “large stores” to “extend its reach in sales of clothing, household items, electronics, and other areas,” with shelves featuring Amazon’s own-label products as well as goods from “top consumer brands,” people with knowledge of the matter said.
The first openings are likely to take place in California and Ohio, with the stores expected to cover an area of around 30,000 square feet. That’s almost 10 times larger than Amazon’s existing 4-Star sites, and similar in size to the smaller stores that have been opened recently by the likes of Bloomingdale’s and Nordstrom.
The Journal’s report comes a year after a similar one from the same publication 12 months ago that suggested Amazon could even move into sites vacated by the likes of Sears and J.C. Penney, whose businesses have been hit by Amazon’s hugely successful online operation. No, the irony of Amazon’s reported retail expansion will not be lost on those hammered by the company’s meteoric rise since its launch 27 year ago.
This week’s update from the Journal makes no mention of when Amazon might open its first large store, but the report appears to confirm that the Seattle-based company is moving forward with its apparent plan to further expand its physical retail presence.
While many may see it as a bold step considering the growing popularity of online shopping, the reported move suggests Amazon is enjoying success with its current retail outlets and is now ready to explore a new format in terms of its own store operations.
Amazon opened its first retail store six years ago as a way to sell more books. Since then, it’s launched more bookstores and opened cashier-free grocery stores called Go that use cameras to track customers’ selections before automatically charging their account. It also opened Amazon Fresh grocery stores and in 2017 acquired Whole Foods, which has around 500 sites. In a further expansion into real-world retail stores, Amazon launched its 4-Star format that offers popular items from its online site.

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It’s Time for the Again-to-College Brews

How C-Stores Can Boost Profits as Parents Hit the Road Again

It’s that time of year again — and it’s been a long time coming. Back-to-school, in-person learning is finally a reality across the country. For parents and students alike, this time is filled with mixed levels of dread and anticipation. Among those who have been working and schooling from home for 15 months, it also means venturing out into town again and finally ending pajama days. Not to mention earlier mornings, more time driving in the car and, of course, more coffee in the morning and after-school snacking.

Convenience stores (c-stores) have a great opportunity right now to maximize customer value and grow sales. As people begin forming new habits for the next 10 months, it’s the ideal time to make a great impression to drive repeat business. CSP Daily recently suggested a few back-to-school tips for c-stores: clean up, enhance the taste and quality of prepared foods, and offer low prices. Good advice, sure. But I think there’s a more prescriptive approach for making the most of back-to-school demand.

Optimize foodservice

C-stores that offer quality foodservice are primed to capture more of the food-to-go market, which is set to grow 32% this year. We’ve already seen an uptick in the percent of fuel that head in-store to shop. So as school starts back, having an influx of hungry kids being driven around town may increase these sales even more.

To optimize foodservice, you must offer restaurant-quality food, quickly and consistently. But this can be expensive if not done well. It’s important to have  back software that provides a holistic view of demand by daypart and understand prep times and recipe requirements. I crave a good breakfast sandwich after school drop-off and the kids love hot pretzels after school, but we wouldn’t be happy if pretzels were only ready in the morning or if breakfast sandwiches were still sitting on the shelf at 3 pm. It takes detailed planning to ensure grab-and-go food is fresh and ready when demand hits. And it takes detailed recipe management production tools to ensure every order is made just right and waste is minimized. C-stores that do this well often see a 7.7 times increase in foodservice sales versus their peers.

Get inventory right

It’s no secret people like c-stores to be fast. The average shopper spends just 71 seconds searching for what to buy. That’s not a lot of time to make a good impression, but plenty of time to make a bad one. Clean c-stores are important, but so are shelves filled with products people want to buy — without having too much on-hand. We call this effective availability — the perfect balance of on-hand inventory aligned to demand. Not too long ago, clipboards, price books, and spreadsheets were good enough to place orders and maintain inventory. But that just isn’t true in today’s competitive environment when demand can shift suddenly and when there’s competition from virtually everywhere.

With the right back-office software, proper inventory management doesn’t have to involve a lot of manual work. Orders can be automated based on demand forecasting so that what’s arriving to the store is just the right assortment of goods to meet demand. Tracking inventory receipts against orders, pulling sales data from the POS and capturing transfers and markdowns can all be managed by exception, with alerts whenever there’s a discrepancy. Out-of-stocks can be detected with IoT-enabled shelf cameras. If there’s a recall, traceability at the product and lot number is key to keeping customers safe, your reputation intact and your business free from potential liability. Together, these things allow store personnel to focus on more important, like delivering exceptional service and a quick checkout. You optimize operations and reduce the cost to serve, all while delivering a better overall experience to the customers. Everybody wins.

Empower Your Employees

We all know the labor market is tight right now, and it’s about to get worse. This past summer when there was a big need, 32% of teens stepped in and took summer jobs, the highest since 2008. Now that summer is ending and kids are headed back to college, we’re likely to see a further dip in available labor.

C-store operators can focus on employee engagement to help increase satisfaction and improve retention. Empowering employees with mobile tools can make their jobs easier and more enjoyable. Doing daily tasks with a mobile back office system allows employees to stay out on the store floor, which helps build community and allows them to better serve customers. So, customer satisfaction rates increase as well.

How Luminate Store Execution Can Help

Blue Yonder’s Luminate Store Execution is a back office system designed to help c-stores gain visibility and control over the whole store, from inventory and pricing to advanced foodservice and integrated forecourt management. And it does so with a mobile-first approach that keeps associates on the floor to serve customers and help drive loyalty. Advanced food production planning and recipe management ensures food’s always fresh and ready, at the highest quality. Demand forecasting and automated ordering transforms inventory management from being a chore into a competitive advantage. The system simplifies daily back-office tasks such as shelf labels, wet stock management, cash handling, rebate tracking, invoice reconciliation and more. It works with any AP system and POS so you can keep the systems and hardware you like.

For me, back-to-school means adjusting to new routines, finding a way to balance everyone’s schedules, and packing up the flip-flops and pool towels. It’s about realizing the kids are another year older and making the most of these years that go by so quickly. And then there’s coffee – lots of coffee. Fingers crossed the talk about global coffee shortages is only a rumor.

To learn more about how c-stores can win during back to school with the right back office software, read our latest eBook.

Read the “Back-to-School, Back on the Road” eBook

Three Methods Retailers Can Achieve a Put up-Pandemic World

In many parts of the world, but unfortunately not all, consumers are seeing a light at the end of the tunnel. After nearly 15 months of minimizing and even avoiding shopping trips to protect their health, consumers are making their way back to the outside world. But while many of us are venturing out again, many of the shopping habits we picked up during the pandemic or accelerated aren’t going away. According to a survey conducted by Digital Commerce 360 and Bizrate Insights[1], “64% of respondents planned to place more orders online in the next six months, 33% expect to order online and pick up in-store more often and 27% plan to order online and use drive-up or curbside services to pick up from a store more than in the previous six months.”

In our world of unified commerce where consumers expected personalized customer-centric experiences across channels, businesses need to employ a few key strategies to succeed going forward.

Continued Investment in Speed and Convenience Options

In order to meet customer expectations during the pandemic, retailers quickly implemented fulfillment options such as buy online pickup in store (BOPIS) and curbside pickup. These offerings not only gave consumers safer ways to get products, but also made shopping more convenient. As a result, fulfillment flexibility is a must have  –  consumers today expect to be able to check store inventory online, make the online purchase and then pick up items in-store, curbside, or have them delivered to their home.

Retailers that made investments in their omni-channel options saw tremendous growth. Curbside pickup sales at Target grew 600% year over year. The retail chain’s ecommerce sales grew an explosive 145% in its fiscal year ended Jan. 30, 2021[2]. Walmart’s online sales grew 79% for its fiscal year 2021, which ended on Jan. 29[3].

Retailers must continue to expand omni-fulfillment options, curbside pick-up, BOPIS, as well as same-day delivery, while simultaneously investing in operational efficiencies. For example, while more than 50% of major retailers now offer curbside pickup, businesses need to differentiate themselves by offering a seamless and effortless fulfillment experience. [4] Companies can ensure that they have real-time inventory visibility, the right alerting mechanism to ensure customers are informed when items are ready for pick-up, and an easy customer check-in process so customers aren’t left waiting for their order. Customers utilizing these new omni-fulfillment options expect seamless and efficient processes from click to collect.

Make Stores a Destination

The success at Target, Walmart, and Best Buy in the last year showed us that while e-commerce grew 44% YoY in 2020, stores were at the heart of this growth[5].  Of the nearly $200 billion in new e-commerce spending in the U.S. in 2020, $37.44 billion came from click and collect [6].

Stores have to offer consumers differentiated experiences to stay relevant and to become more than a place for click and collect and curbside pick-up orders. The stores of tomorrow need to unify the online and offline worlds. If you’ve been to an apparel, electronics, or even a big box hardware store, customers come inside to touch materials, try on clothes, see the size of items – i.e., fridge or a TV – and see how items look side by side.

Stores give customers opportunities to see things in person and speak to expert staff who can answer questions. A great example of differentiated experiences is the makeup counter. Customers can easily purchase mascara, foundation and eyeshadow online, but in-store beauty experts are able to demonstrate products in real-time, share tips on the right product for an individual’s skin type, and provide insider deals to customers who walk in the door. The stores of tomorrow can’t just be a place to buy goods, but they must offer consumers with delightful and personalized experiences.

Focus on Profitability

During the pandemic-induced e-commerce boom, retailers invested in e-commerce speed and convenience options to meet customer preferences. These investments certainly helped retailers see exponential e-commerce growth as referenced above. However, while many essential businesses such as Target, Walmart, and Costco saw sales go up as they were allowed to stay open and, in many cases, they had invested in omni-channel capabilities prior to the pandemic, others didn’t fare as well. Increased costs of delivery, increased labor costs, warehousing and higher return rates, along with investment in e-commerce technologies quickly added up. To offset these expenses, retailers need to improve e-commerce operating costs.

E-commerce doesn’t have to reduce margins or increase costs. In fact, when done correctly, new omni-channel options can accelerate business to new financial heights. Click and collect is a win-win for both businesses and customers. Retailers can reduce shipping costs and last-mile costs, while consumers enjoy the speed, convenience, low cost, and now safety of this shopping method. Unlike curbside pickup and other fulfillment options, the beauty of click and collect is that customers have the opportunity to browse the store and purchase additional items when they pick-up their online order.

Change isn’t always easy. But with a few small steps, businesses can set themselves up for success in a post-pandemic world.  Blue Yonder can help businesses become more competitive by offering speed and convenience options, creating engaging in-store experiences that unify the online and offline worlds, and optimizing fulfillment.


How Blocking the Suez Might Dampen Summer time Demand

In what feels like an anti-climactic end to an incredible story, the Ever Given – the boat that broke the internet when it blocked the Suez Canal back in March – has finally docked at Felixstowe, England, with its cargo from the Far East – a full four months after it was scheduled to arrive. 

It was one of those great black swan events that kept many of us enthralled for days, but what can this whole event teach us about supply chain resilience? Billions of pixels of digital news have been used to describe how supply chains need to understand the macro picture, like shipping delays and supply impacts. Today, I want to focus on the micro. I want to follow the ripples of the Suez Canal situation all the way to the UK high street.

In an earlier blog, I wrote about volatile customer demand and how a modern machine learning forecasting algorithm needs to account for uncertainty. To re-cap, the Blue Yonder demand forecasting service looks for relationships between influencing factors, such as weather, price, and season, rather than attempting to layer on top of a demand forecast based on historical sales. That is the key to understanding uncertainty and driving better forecast accuracy. Now that the Ever Given’s cargo has finally landed in the UK, there is a lot of uncertainty about to disembark.

Uncertain Supply

The Ever Given holds around 18,000 shipping containers containing a mix of perishables and non-perishables. The perishables will be destroyed, but many of the non-perishables will have been timed for start of spring. Some may go directly into UK market via discount retailers or re-directed to markets further afield.  For what remains in the UK market, retailers are faced with inventory that is out of sync with the season.  Couple this with the increased cost of shipping caused by the pandemic and you’ve got the perfect storm of tight margins, increasing prices and too much stock.

Uncertain Demand

Based on historical data, we know that customer sensitivity to price change is not uniform, either geographically or across the year. A price change for T-shirts in mid-summer may not have the same effect on demand in spring, unless there’s also an unseasonal heatwave. The location of the store also plays a critical role in this relationship, with coastal stores typically seeing higher traffic during the summer. 

This is far from a typical UK summer though. Temperatures have been hotter and drier in the north, while the south has recently seen storms. Meanwhile, with COVID-19 restrictions on travel and changing regulations, more people are staying at home for holidays.

Many of the items on the Ever Given were originally due to be sold at the end of spring. Seasonal items are typically discounted at the end of the season, but with higher shipping costs, increasing retail prices and potentially more local competition on the high street, you need to understand how your customers are likely to behave, while being ready to pivot when they surprise you by shifting purchases back to stores, or looking for outfits to hit the town again.

Blue Yonder Forecasts Better

Blue Yonder can help automate your demand forecasting with its granular, proprietary forecasting service designed to self-learn trends at local levels and dynamically respond to the crazy weather or changing store patterns from the stay-cation craze of 2021. A demand forecast that understands complex uncertainty but simplify human control can help build better allocations, improve resourcing and ultimately feed into better pricing decisions. It will help your business teams navigate the uncertainty that surrounds us every day, and lead to improved business KPIs.

Black swan events like the Suez Canal blockage will always occur, and tools like Luminate Control Tower can help us better manage them. We cannot reasonably predict black swans, nor can we learn anything meaningful from them for future forecasts. It is the daily uncertainty that we need to manage; and if the management of day-to-day disruption is automated, planners should have more time to deal with the black swan events when they occur.

Like the slow progress of the Ever Given out of the Suez Canal, the effects of uncertainty can take a long time to manifest in the market. With the lived human experience of pandemics in short supply, highly intelligent and automated demand forecasts are the critical foundation of a resilient supply chain. Major shocks get most of the attention, but markets are uncertain every day. Sometimes because of weather, sometimes because of price, generally because of the combination of all the factors operating together in a connected network at the local level.

If the future of retailing continues to be uncertain, the heart of your supply chain needs to do more than cope. It needs to thrive by embracing uncertainty.  Blue Yonder’s unique approach has been designed to deliver the supply chain of tomorrow. Please contact us if you’d like to discuss how we can help transform your business.

Unleash the Energy of BOPIS for Again-to-College Buying

There’s never been a better time to be a retailer. After nearly 18 months of remote learning, school districts across the US are mandating a return to in-person learning. Colleges are bringing students back to campus. According to a recent report from Deloitte, 1-3% growth seen in the recent past.

And just like we’ve seen items in short supply in other categories, this year parents can expect the same when it comes to back-to-school items. Tablets and computers, along with sneakers and licensed character backpacks are only available in limited quantities the supply chain strains seen since the pandemic This means parents can expect limited stock levels and choices for many coveted items, along with fewer discounts.

With the shopping landscape continuing to be impacted by pandemic, parents need all the help they can get from retailers for a seamless and efficient experience. Offering omni-channel capabilities such as buy online and pick up in store (BOPIS) can give shoppers a convenient shopping experience while saving them time and money.

Many consumers prefer BOPIS since it allows them to shop online without dealing with shipping costs. When shopping online, consumers can find out what’s available and what’s out of stock immediately, thus helping them avoid wasted trips to the store. This is a great experience for shoppers and it’s a win for retailers too. BOPIS both offers the advantages of digital shopping and encourages customers to continue to engage with brick-and-mortar stores where they are likely to add more items to their cart.

Let’s walk through a traditional shopping experience versus BOPIS. If you’re a typical parent, you’ve received a comprehensive list of supplies that your kiddos need, and if not, many retailers have copies of your school’s list in the store. When you go down the path of visiting your favorite retailer this back-to-school season, be prepared to visit one or more retailers to get through your shopping list. If you’re lucky, every item will be available in one store. But if you can’t find all your must-have items, that same process will have to be repeated till the list has zero items left. And don’t forget, it’s often hard to find items with crowded stores when everyone is shopping for the same things — yellow folders with 3 prongs, pink erasers, college or wide ruled notebooks.

When you go down the path of buying items online, you can quickly see the availability of items at your favorite retailer(s). If your retailer lets you search for your school’s list, you’ll likely be presented with all items on your list. You can accept the selection or make substitutions or deletions. Once you have everything you need, you can select the fulfillment method of choice — in this case BOPIS. In a matter of minutes from the comfort of your home, your shopping is complete. Now the only thing left is picking up items in the store.

Making life easier for parents doesn’t require retailers to overhaul their existing technology stack. Blue Yonder’s Luminate Commerce microservices can be augmentatively added to existing solutions to help organizations drive e-commerce growth. With solutions such as Inventory Availability which gives busy parents the ability to see what and how many items are available at their local store, and the Commits microservice that tells them what fulfillment options are available — such as BOPIS, curbside, ship to home, etc. — and when items will be fulfilled, retailers can empower today’s shoppers to make smarter decisions. And for retailers, Luminate Order Fulfillment supports store fulfillment activities (curbside, BOPIS, ship from/ to store, same day delivery/last mile) by streamlining the process of accepting, prioritizing, picking and packing, and finally handing/delivering orders to customers. Blue Yonder’s e-commerce microservices can make your retail establishment the go-to destination for back-to-school shopping and every other major shopping event.

BOPIS should be in the arsenal of every retailer today. It’s not just that these omni-channel options cater to the demands of customers, but they enable businesses to gain an economic advantage. With back-to-school season budgets up this year and many items in short supply due to supply chain issues, offering the best customer experiences can give organizations a leg up.

To learn more, click here.

The place is My On-line Order? Will It Be Early or Late?

U.S. e-commerce sales are projected to continue rising 17.9% in 2021 to $933.30 billion[1] and   worldwide e-commerce sales are projected to grow to $4.2 trillion[2]. Clearly, millions of us are shopping online and many of us fell in love with online shopping during the pandemic when many non-essential stores closed, and we need safe and convenient ways to buy goods.

However, while online orders continue to grow, order accuracy and fulfillment accuracy leave much to be desired. While customers expect the online shopping and order fulfillment process to be efficient and accurate, they often experience out of stocks, flakey delivery dates, shipping delays, and early arrivals resulting in poor customer experiences.

We have all experienced the following scenarios. We search for a few products online, find the items and add them to our cart. After a few minutes or even longer, we go to the checkout and make the purchase. Unfortunately, when the confirmation comes through, one of the coveted items isn’t there. You get an out-of-stock message. Nothing kills the customer experience more than this. 

In fact, I ran into this scenario last fall while trying to buy dumbbells like most Americans trying to stay fit while gyms were shut down. I searched the website of a local big box retailer and found a store within 10 miles that had what I was looking for. I was so excited to finally get my weights and more than willing to drive two towns over. Utilizing buy online pick up in store, I thought I was buying my weights along with a few other things. Unfortunately, instead of driving out of my way to pick up the coveted dumbbells, I was picking up items that I could have easily found at a store closer to my home.

Another scenario that’s become quite common in the last year is shipping delays or early arrival of packages. Order by/get by reliability has gone down. With customers starting to get out more often, going back to the office, and with package theft becoming a huge issue in many areas, knowing exactly what day an item will be delivered has become even more important.  Unreliable fulfillment times plague not just small retailers but even the household names that we’ve come to rely on. That Monday delivery speeds up to become a Sunday delivery when we’re not home, or that expected Tuesday delivery turns into a Thursday delivery. 

In most cases, the clothes or shoes I recently bought online were nice to have items and not urgently needed, but unreliable delivery dates meant I really didn’t know when items were going to arrive until the last minute. Shifting fulfillment dates creates bad customer experiences. When customers buy items online, they are buying items based on where they are located if they choose BOPIS or curbside, or when they will be available. Customers have come to expect 3-day shipping or BOPIS in 2-4 hours to mean just that. Even in scenarios where items aren’t needed immediately, reliable fulfillment is a must have.

While it may seem daunting to address these issues, nothing could be further from the truth. Implementing the right e-commerce technologies can improve the order and fulfillment process that inevitably enhances customer experiences. Let’s start with our out-of-stock scenario.  Implementing Blue Yonder’s Inventory Availability solution can help retailers and other businesses get a real-time view of all available inventory across their stores and warehouses to make real-time sourcing and order promising decisions. The solution enables businesses to expose store inventory to online shoppers in order to utilize inventory. Based on geolocation, retailers can show customers what’s in-stock/out of stock, present urgency messaging such as “2 items left,” and show items available for pick-up and/or available for shipping. 

And equally important, the microservice supports product reservations enabling consumers to reserve products during the shopping journey and then purchase those items either immediately or within a period set by the retailer. In my example, once I placed the dumbbells in my cart, the product should have been “reserved” for me and instead of showing 9 items left, the system should have showed 8 items left to other customers.

Let’s talk about accurate and reliable order by/get by dates. When we shop online, we have come to expect our favorite online retailer to tell us when we will receive our shipment. We expect almost frictionless online shipping experiences with near immediate results (delivery).  You can call it the Amazon effect or just a heightened change in expectations. But the reality is that retailers are competing based on their online experiences now. One late delivery or a package with missing items, and the customer can with a click of their mouse find alternative stores. 

Blue Yonder’s Commits microservice enables retailers to provide the speed and convenience options that customers expect along with accurate order by/get by dates and optimized order fulfillment. Consumers today expect definite delivery dates and it’s no longer acceptable to offer a 3 to 5 business day delivery window. With Blue Yonder, retailers can tell customers from the beginning of the shopping journey when products will be delivered or available for pickup.

Offering accurate commitments and multiple fulfillment options from the beginning of the shopping journey presents businesses with an opportunity to gain new repeat customers, minimize cart abandonment, and increase conversion rates.

To bring this all together and really understand what’s happening with orders at every stage of their lifecycle, you need a nimble order management/order services solution that tracks and executes orders from click to collect. Blue Yonder’s Order Services microservice along with visibility from Customer Order Visibility works in concert with Inventory, Omni-Channel Fulfillment, and Order Fulfillment to give you a full picture of orders and fulfillment. It provides a central service to manage and orchestrate orders seamlessly across internal and external services, which ensures a single source of truth for all order transactions and provides visibility at each step of the order lifecycle to ensure order and fulfillment accuracy.

The Order Services microservice enables organizations to execute required order validations and coordinates required interactions with required systems. No matter where an order sits in its fulfillment lifecycle, businesses and their end customers have real-time visibility.

Delivering on the promise to customers has never been easier. It simply requires organizations to support digital transformation through the implementation of nimble e-commerce microservices. Blue Yonder Luminate Commerce microservices can offer organizations just that.  Through our e-commerce microservices leading retailers have exposed store inventory to online shoppers, provided accurate fulfillment dates, optimized orders to maximize margins and reduce costs, and gained visibility of orders from click to collect. To learn more about these solutions, click here.  



Picky Soccer Mothers Select Stock Availability

As a retail product marketer here at Blue Yonder, I spend a lot of time talking about the skyrocketing popularity of omni-channel, the power of end-to-end visibility, and how customers have increasing demand for convenient and easy shopping experiences. But it wasn’t until a recent incident with my 12-year-old son, Jeremy, where I fully understood how commerce solutions that include AI and ML can actually help make people’s lives better.

Let me set the stage. It’s 9:30 a.m. on a Saturday, and it’s the last soccer game of the season. I’m drinking coffee and feeling good, since (for once!) I’m ahead of schedule. Just then, Jeremy tells me he can’t find his shin guards and must have them to play. “No problem,” I thought, still feeling confident. “The game doesn’t start until 11 a.m. We’ve got plenty of time to go to the sporting goods store across town, get new shin guards, and make it to the field.” Just then my husband called from work to remind me the game actually starts at 10 a.m. That happy, calm feeling was now gone.

There were only 30 minutes to get out the house, shop for shin guards and get to the field. Knowing we didn’t have a moment to spare — and how important it was to Jeremy to make the last game — I realized I had to know exactly where to find shin guards even before leaving the house. The sporting goods store I had in mind was 20 minutes away, in the wrong direction, so that was out. It was time to browse online for other local retailers along the route. The first retailer showed they sold soccer equipment but didn’t show what was in stock and what wasn’t. Nope, too risky.

I checked a different retailer’s website and saw three pairs of boys XL shin guards were in stock at the store near me. We jumped in the car and headed that way. We ran in the store, grabbed the shin guards, and were in and out in six minutes. Jeremy finished getting ready for the game along the way, and we got to the field — I am not making this up — at 9:53 a.m. Warmups were still going on, so Jeremy was able to play his last soccer match — and it was all thanks to inventory availability.

Later that day after the game, it hit me like a ton of bricks. People don’t shop thinking about technology or even channels, they shop based on what’s easiest for them in that moment of need. When I needed shin guards, I didn’t think about microservices, or what they enable. I only thought of Jeremy and how important it was to him to finish the season playing alongside his teammates.

But let’s talk about the innovations that made this experience a reality. The retailer had to know every item that was in stock across every location. Plus, inventory balances would need to update in real-time to give me the confidence shin guards would still be in-stock when I arrived. This requires understanding where inventory is located across channels and locations and for the retailer to have a singular view of this data.

Blue Yonder helps retailers achieve a holistic view of inventory availability at both the enterprise and local levels to deliver seamless customer experiences. Retailers can share this data with consumers at the beginning of their shopping journey to help guide their purchase decision. With geolocation, customers see what’s in stock at each location and whether it’s available for in-store shopping, curbside pickup or shipping. This not only gives customers peace of mind regarding their purchases, it helps drive incremental sales for retailers that can offer alternatives if a single store is out-of-stock. In my case, this visibility gave me the peace of mind that my local store had the shin guards Jeremy needed.

That Saturday, I was thankful for all the behind-the-scenes technology that made my shopping experience so positive. I realized how much of an impact inventory availability had over that tiny but important slice of my life that day, and how it was the one thing that made it possible to get Jeremy to his game on time — with shin guards! The experience got me thinking about what would have happened if I had to shop the old-fashioned way and take my chances at the store without inventory availability. How different would our day have turned out?

Check out the infographic below to see a side-by-side timeline of choosing a retailer with inventory availability — versus choosing one without.

An Clever Technique to Enhance Demand Forecasting

I’m a cyclist. But I have a confession to make. I’m a fair-weather cyclist. While riding my bike helps keep me healthy and gives me time to think, when I get caught in a rain shower, I know I’ll be spending a significant chunk of my afternoon cleaning mud and gunk off my bike. And so, based on my willingness to accept risk that day, I make a judgement call. Before I leave the house, I always consult the weather app on my phone. Anything more than a 30% chance of rain and I stay inside.  I estimate that has saved me hours of de-greasing in the past year alone.  

I find it interesting that concepts that we readily accept with our personal devices don’t always seem to resonate in the workplace.  When I’m considering whether to risk cleaning my bike after a ride, I rely on a weather forecast that may or may not materialise. I don’t question whether the forecast is right, I accept that it is uncertain; sometimes it rains, sometimes it doesn’t. I make my decision based on a preference for staying dry.  

Demand Forecasts are Uncertain 

The same principles of risk and uncertainty that we accept in weather forecasts apply equally to demand forecasts. Order too much and you lock up capital in slow moving inventory or eat into margins for perishables Order too little and you run out of stock and disappoint customers. Planning inventory relies on an accurate demand forecast. Understanding that forecasts always include a level of uncertainty is the critical first step toward resilient supply chain automation.  

So how do you build a resilient demand forecast that understands uncertainty? Traditional approaches to forecasting are fundamentally flawed. Basing a demand forecast on sales history alone doesn’t measure true demand. Local out-of-stocks are written into the sales record alongside historical weather patterns and events, creating future manual work for demand planners, such as holiday and cultural events like Easter, or trying to “correct” last year’s wet-and-washed-out summer. This problem is compounded when daily profiles are applied to a baseline forecast before manual adjustments are made. 

Weather only repeats itself 15% of the time, but it’s often used as an influencing factor for demand.  We shouldn’t be surprised that demand planners spend a considerable amount of their time tuning algorithms then adjusting the output to something that looks more “correct,” based on their experience. The problem with experience, especially in today’s fast changing market, is that no-one really has relevant experience that they can draw on.  

McKinsey research tells us that the past is no longer a guide to future behaviour, as consumers increasingly shift channels and are looking for new brands and more convenient experiences. Forecasting capabilities that look backward to predict the future are fundamentally flawed. They struggle to adapt to changing shopper behaviour and cannot measure uncertainty without making assumptions. They leave demand planners exposed to inventory risk. 

Embrace Uncertainty in Demand Forecasting 

Blue Yonder corrects these flaws by forecasting via a unique and more accurate approach. Our demand forecasts are built on machine learning analysis of the relationships between many different historical data sources, such as weather, special events and price. We don’t use artificial intelligence to layer influencing factors on top of a baseline, but rather look at how strong each influencing factor is at any given point in time and use this as the basis for forecasting into the future. Missed sales are accounted for and special events are automatically moved as calendar dates shift. 

Once trained, the forecast engine tests itself against actual sales every day to ensure that as customer behaviour changes, the model is able to self-correct. Configurations like weekly profiles and assumed statistical distributions are made redundant as the forecast is created every day from the ground up, using the most recent data to improve accuracy. This changes the role of demand planner from algorithm tuner into data custodian and strategic advisor. 

Our unique demand forecast predicts the full spectrum of demand, not just the mean, and it calculates the probability of every unit of demand at the item, store, day level rather than assume a shape or profile. This information becomes valuable when you later want to make inventory decisions, recommend price changes or make assortment changes. Irrespective of how close your mean might be to historical sales, there is always a chance that customers will want to buy more or less of what you predict.  

A demand forecast that intuitively understands what factors drive shopper behaviour is useful for predicting demand for all retail assortments. Fresh produce demand can vary widely across the week as the weather changes. Promotional demand varies depending on pay day, local competition and the season. And, of course, seasonal products like BBQ accessories and clothing can depend disproportionality on weather. Chasing volatility manually cannot be accomplished with the precision required to make a difference at the point of purchase. Planners might plan at a cluster level, but shoppers act locally.  

Accurately understanding this complexity at the local level is extremely useful for creating better demand predictions but automation is not possible without trust between humans and the machines that serve them. The complex reality captured by our forecast engine is presented to humans in a meaningful way, with data grouped in buckets that make sense in plain language. Weather, promotion or trend rather than temperature or shelf position, breaking the black box problem that plagues most machine learning solutions.  

By adopting an automated, self-learning demand forecast like Blue Yonder’s, planners no longer need to tune algorithms or adjust forecasts to account for changing weather or promotional calendars. The forecast can be largely automated, leaving planners to focus on system-generated exceptions, and collaborating with others on how to best use more intelligent and accurate forecast to drive better results, like getting the right amount of inventory where it is shoppers are likely to want it.  

This re-imagined approach is all very simple to the user. A lot like my Sunday afternoon when I can skip giving the bike a bath and focus on more productive things.  

Trendy Order Companies for Most Flexibility

This blog is co-authored by Nina Seth, Product Marketing Director, and Sumit Mittal, Product Director – Commerce Solutions

It goes without saying that COVID-19 changed the face of retail and how we shop. E-commerce was rapidly growing prior to the pandemic, but this transformative event created an inflection point. The pandemic pushed even more U.S. consumers online, contributing an additional $105 billion in U.S. online revenue in 2020 and accelerating e-commerce by two years, according to Digital Commerce 360 estimates.[1]

As customers rushed online, businesses of all sizes faced the challenge of keeping up. Not all businesses had invested in technologies supporting a digital transformation. Many scrambled to implement online shopping, curbside, and buy online pick-up in store (BOPIS) to meet customer demand for speed and convenience options.  And once they offered these new options, many couldn’t fulfill products on-time. Even e-commerce powerhouses saw shipping delays.

The last 15 months have shown us that consumer expectations have completely changed. Shoppers want seamless, personalized and accurate customer-centric experiences across channels. Consumers want to quickly see what’s available and where, how it can be fulfilled, when they can get it, along with continuous and accurate updates about their order. With high expectations and alternatives at consumers’ fingertips, businesses need to invest in the right e-commerce technologies to retain customers. Store and brand loyalty are out, while accurate inventory, speed and convenience are in.

Traditional OMS Creates Pitfalls

Many businesses have relied on traditional order management solutions (OMS); however, OMS’s aren’t nimble, require a system overhaul and can take years to implement. These monolithic solutions aren’t built to scale to support e-commerce and don’t offer the flexibility businesses need to rapidly scale up or down with consumer demand.

Often an OMS is not properly connected to other systems leading to pitfalls for both retailer and end-customers alike.  Without a single record for orders, a customer can end up receiving different messaging. For example, a customer placing an order could see one message on the website showing delivery in 5 to 7 business days, and then the order confirmation email could provide completely different information. And the actual delivery time could be different than the website and the confirmation message.  For businesses looking to address pain points today, a traditional OMS won’t solve problems in time nor support their digital transformation.

Flexible Order Services Keep Businesses Competitive

This is where having the right order management/order service comes in. In the increasingly complex world that spans multiple channels (stores, digital storefronts, marketplaces, call centers), organizations need nimble order services solutions that can help orchestrate orders from click to customer regardless of how products are fulfilled. The best order services solutions track orders across channels and enable businesses to deliver on the promise to customers. Being able to quickly implement order services capabilities can mean the difference between staying competitive by offering accurate inventory visibility and fulfillment options versus flying blind for another 12-18 months.

Many organizations have started their modernization journey and are looking to supplement their current implementation, while others have just embarked on their digital transformation and need new capabilities to drive modernization in their organization. Regardless of the scenario, Blue Yonder now offers a robust order services solution to address these requirements.

Blue Yonder’s Order Services and Customer Order Visibility

Blue Yonder’s new Order Services microservice, along with proactive actionable insights from Customer Order Visibility (COV), provides fulfillment transparency to businesses and their customers by managing orders across geographies, brands and channels, utilizing modern fulfillment options such as ship from store, BOPIS, curbside, and same-day delivery. This microservice enables businesses to manage and orchestrate orders seamlessly across internal and external services, which ensures a single source of truth for all order transactions and provides visibility at each step of the order lifecycle to ensure order and fulfillment accuracy. Details of all orders are then available in one place for staff to check and update order status and for customers to understand when they can expect their order.

Blue Yonder’s Order Services is a highly performant and scalable API-based microservice that can be surgically added into a business’s existing systems and takes only months to deploy. For organizations looking at time to value, Blue Yonder’s service can quickly address immediate requirements and grow with the business.  It allows organizations to modernize their tech stack while using the systems in place. And since the solution is designed to address the needs of organizations driving digital transformation, it’s built for internet scale. Along with our microservice, our team of industry experts help scope and design implementations that drive organization’s e-commerce growth to provide ROI.

Order Services and COV give retailers the right capabilities and insights to deliver on their promise to customers. Serving customers today requires being nimble. Customers want to shop in the way that’s most convenient to them.  Regardless of how customers shop, retailers need technologies that help them seamlessly manage orders from click to customer.

Learn how Blue Yonder can help you here.


Amazon Prime Day 2021 Client Survey: 4 Tendencies From This 12 months’s Annual Buying Occasion

As vaccination rates continue to increase, consumers are shifting spending habits from hand sanitizer and disinfectant wipes to new clothes and personal care supplies. Retailers are seeing strong sales heading into Q3 as a result.

Amazon Prime Day, typically held over the summer, was pushed into October last year due to the pandemic. As many consumers return to “normal” spending habits, this year’s annual event was in many ways the retail industry’s first big test on its road to recovery.

To help uncover the latest consumer trends for Amazon’s annual shopping event, Blue Yonder surveyed over 1,000 consumers who participated in Prime Day to explore the impact of out-of-stocks, competing retailer deal days and more.

Here are four trends we uncovered.

Out-of-stock products highlight consumer re-entry into public life:

32% of consumers said they experienced out of stock products when shopping on Amazon Prime Day.The biggest categories impacted by out-of-stock products were Amazon device accessories (Kindle, Alexa, Fire Stick, etc.) (37%), beauty products (22%), automotive/Powersports (20%) and health/personal care (20%).78% of consumers spent the same or more on Amazon Prime Day this year compared to last year, with 46% of consumers saying they spent more.

Beauty continues to be a massive growth vertical for Amazon and was one of the top performing categories during this year’s Prime Day. As people return to social gatherings, sales of self-care products such as deodorant, teeth whitener, and nail polish are on the rise.

Consumers participated in other retailers’ deal days, but Amazon Prime Day is still #1:

60% of respondents made a purchase on Prime DayConsumers participated in other deal days from Walmart (35%), Target (26%), Best Buy (15%), and Ebay (8%)73% of consumers went to Amazon to look for deals first

Amazon remains the first place consumers look when they are seeking discounts. However, Prime Day is no longer just for Amazon. This year, other retailers like Walmart, Target, Best Buy and Ebay launched their own competing deal days, offering sales on everything from groceries to apparel. Although Prime Day still reigns supreme, Amazon no longer owns the entire share of the market.

Consumers increasingly use Prime Day for back-to-school shopping needs:

38% of consumers said they made back-to-school purchases on Prime Day this year23% of consumers said they made back-to-school purchases on Prime Day when asked the same question in a 2018 survey

Consumers are getting ahead of back-to-school shopping this year compared to last year when in-person learning protocols were more uncertain. During back-to-school shopping season, retailers can use technology powered by artificial intelligence (AI) and machine learning (ML) to drive accurate demand and assortments to reduce waste with dynamic segmentation. Blue Yonder’s Demand Planning solution ingests hundreds of demand-driving variables and uses ML to provide a unique demand projection with calculated business impact and risk. This enables higher planner productivity, better inventory management and an improved understanding of demand drivers and customer behavior.

Despite Amazon’s investments in reverse logistics, consumers do not intend to return items purchased on Prime Day:

76% of shoppers did not purchase any items with plans to return them (multiple sizes, styles, etc.)51% of consumers still prefer to return Amazon items through UPS; 25% prefer Kohl’s, 11% prefer Amazon Hub Lockers and 9% prefer Amazon physical retail locations

The pandemic forced retailers to invest in their returns processes. In addition to making the returns process as seamless as possible, retailers can use technology to minimize returns in the first place. For instance, AI and ML can be used to create return-conscious pricing models, which are especially effective during industry-wide sales events, like Prime Day, where brands are heavily discounting fashion items.

For example, if a graphic tee costs $60 or $70, and it’s not exactly to a customer’s taste, they’re going to want their money back. But at $25, returning the item might not be worth the consumer’s time. AI and ML can help predict the best price to minimize returns.

Where does the retail industry go from here?

Amazon Prime Day provided valuable insights for retailers as in-store shopping continues to return.

First and foremost, retailers need to ready their stores because consumers are returning to in-person shopping. Ensuring front-end and back-end technologies can meet consumer needs from inventory to returns will be crucial. Additionally, back-to-school is on the horizon and consumers are shopping earlier than years past. Retailers should consider adopting AI-powered demand planning solutions to ensure they have the right inventory and assortment during this critical shopping period. Finally, returns continue to be a challenge for retailers and consumers alike. Retailers should consider employing an end-to-end supply chain solution to bolster their returns process and better the experience for both retailers and customers alike. This, combined with return-conscious pricing, can help minimize returns and maximize profits.

Retailers, what did Amazon Prime Day 2021 teach you?