Modern Merchandising Stage 2: Digitize Milestone Meetings
July 25, 2022
From Direct-to-Consumer brands to fast fashion to social commerce, the retail landscape has changed dramatically within the last several years. Yet most brands continue to approach merchandising the same way they did three decades ago, and it’s having increasingly devastating economic and environmental effects.
Today, consumer satisfaction and profit margins have hit rock bottom, while markdowns and waste are at all-time highs. Modern consumers keep products just half as long as they did 15 years ago, and retail overproduction has reached an astonishing 40% per season.
As we covered in our previous post, stepping outside their echo chambers and tuning into the real-time voice of the consumer is the first step for brands to evolve their merchandising strategies to a more data-informed, consumer-obsessed, and demand-driven model. Next, brands must embrace technology to streamline milestone meetings and enable more agile decisions that meet the real-time demands of modern consumers.
From flying decision makers around the world to flipping through 300-slide decks of assorted items, the traditional product creation and line review process is extremely analog, subjective, and time-consuming. Teams must operate within tremendously tight deadlines and work on multiple seasons at once to deliver on schedule, creating a staggering amount of stress and environmental waste along the way.
Stage 2 of the MakerSights Modern Merchandising Maturity Model maps out the tools and tactics brands can use to digitally transform milestone meetings in a way that enhances productivity, strengthens decision making, and drives sustainability. Read on to discover whether your brand fits into this stage, the top challenges and biggest opportunities you’ll likely face, and some of the specific actions you can take to reach maturity.
Start at Stage 2 if…
You have a clear picture of your current target customers and aspirational consumers.
Your team uses a variety of data sources to help guide assortment decisions, including historical sales performance, eCommerce activity, and direct consumer feedback.
Global stakeholders are flown into a central location to meet in person for all milestone meetings, where they often review a large number of physical samples — many of which don’t make the cut.
Assortments are organized and shared via PowerPoint, Google Slides, or a similar tool.
Key metrics (e.g. unduplicated reach, % investment depth, etc.) are manually calculated in a spreadsheet and recalibrated as assortments evolve.
Top Challenges and Opportunities
How to Reach Stage 2 Maturity
1. Identify opportunities to meet virtually.
Brands traditionally bring cross-functional teams from around the world physically together for milestone meetings. Stakeholders huddle around moodboards and swatches for hours at a time, their opinions growing louder and more forceful as their scheduled departures draw near.
Finding time for dozens of decision makers to come together is no easy feat, further delaying the already lengthy product creation and line review process. When teams do meet, the pressure to hit deadlines is on, trapping merchants in an inefficient cycle of “hurry up and wait” that typically ends in hasty decision making. In addition to the costs associated with plane tickets, rental cars, and hotel rooms — not to mention the loss of productivity due to travel — transportation is one of the leading causes of global warming.
Meeting face-to-face certainly has its merits, but the COVID-19 pandemic proved that technology has advanced to a point where employees can come together virtually without missing a beat. In fact, many teams find that they communicate better and are more productive during virtual meetings.
Consumer-obsessed brands looking to accelerate the assortment development process and minimize their environmental footprint should consider adopting cloud-based collaboration tools like the following:
Zoom: Zoom is an intuitive video conferencing tool used by small teams as well as those that host meetings of up to 1,000 participants. Attendees can share their screens to review documents as a group, and meetings can be recorded for easy reference.
Slack: Slack allows people to quickly chat with one another and receive conversation alerts in real time. Users can message each other directly or as groups, as well as create dedicated channels for specific topics. Slack also offers basic video chat.
Asana:Asana’s project management solution helps teams plan, track, and accomplish tasks. Users can discuss work, share files, and view progress from anywhere in a centralized space that reduces the need for meetings and enhances productivity.
Your team may be hesitant to forego in-person milestone meetings for digital collaboration, and that’s okay. We recommend starting by identifying a handful of early-stage gatherings that can easily be done online to help prove out the concept and get everyone feeling more comfortable.
2. Minimize physical samples
One of the top reasons for holding milestone meetings in person is to see and feel samples of new product colors, patterns, and fabrics. Teams often delay important assortment decisions as they wait for samples to be produced at various stages of the product creation process. Unfortunately, most of these never even become products, contributing to the 13 million tons of textile waste generated by manufacturers and retailers each year — not to mention exacerbating the post-pandemic supply chain crisis.
While there’s no substitute for feeling the difference between wool and cashmere, the quality of 3-dimensional computer-aided design, or 3D CAD, can help stakeholders accurately visualize product graphics, materials, textures, and more. This allows brands to quickly narrow down the number of samples they need to produce to only those that teams feel most confident about moving forward with.
We recommend brands start utilizing CAD software to virtually test product concepts and design details in the early stages of the product creation process, with the goal of eliminating physical sampling altogether whenever possible. The result? Faster milestone decisions and a healthier planet!
3. Digitally organize products and assortments.
The most common way for brands to organize and view assortments is via slide decks. Each slide usually features a single product with information like its colorway names and suggested retail price. This means stakeholders must flip through hundreds of products one at a time to review the full assortment. It’s also impossible to quickly segment and view products by particular materials or color codes, for example.
In contrast, assortment management solutions allow merchants to see and manage dozens of products in a single digital view. This helps stakeholders better evaluate individual items in the context of the broader assortment. Capturing product details like color story and forecast makes it possible to dynamically splice and group assortments by these dimensions, enabling teams to rapidly spot gaps, over-assortment, and untapped opportunities.
While every brand’s line architecture is unique, we suggest grouping and evaluating products by the following product details to further refine and accelerate assortment decisions:
4. Centralize all assortment data in a single workspace.
In addition to slide decks, valuable merchandising data also lives in emails, spreadsheets, notebooks, PLMs, and even people’s heads. It’s easy for important details to get siloed or slip through the cracks, causing confusion and misalignment that makes driving consensus during milestone meetings a major headache.
Teams must carefully cobble information together piece-by-piece to get a complete picture and have informed conversations. So much due diligence slows data-informed decision making and often leads stakeholders to simply follow their gut instincts.
Taking a demand-driven, consumer-obsessed approach to merchandising requires brands to establish a single source of truth where all assortment data is housed, fully-integrated, and easily accessible. Imagine a dynamic digital workspace where all stakeholders can go to view entire seasonal assortments, review consumer feedback on specific products, check the latest regional sales forecasts, provide commentary on next season’s experimental styles, and so much more.
Milestone meetings become much shorter and less stressful when everyone is looking at the same set of complete, up-to-date information. Discussions are more objective, consensus is reached more quickly, and decisions can be made with confidence.
5. Make agile decisions with interactive insights.
When all assortment data is digitized and in a centralized workspace, it’s much easier to leverage the power of technology to do complex analysis, uncover meaningful insights, and share information with other stakeholders. Decisions become increasingly strategic and agile, empowering merchants to bring the right products to market much faster.
For instance, the latest assortment management solutions use data science to calculate highly accurate buy depth ranges based on sales goals and forward-looking consumer demand data. In the event that a supply chain issue should arise, these investment recommendations can be automatically recalculated by simply removing the SKU(s) in question.
Optimizing assortments for different channels, regions, and audience segments also becomes a much faster, more objective, and data-informed exercise with interactive charts that measure and display product reach within the context of the assortment. Merchants can rapidly test, plan, and adjust various scenarios by visually adding and removing SKUs to and from the mix.
Let’s Get Digital
Digitally transforming milestone meetings requires executive sponsorship, organization-wide effort, and proactive change management. It’s important to note that not all employees are technologically savvy or curious. We recommend approaching the process step-by-step, and providing stakeholders with appropriate levels of training, support, and encouragement along the way.
Evolving your merchandising strategy doesn’t happen overnight, but following the five recommendations outlined in this post is sure to bring you one step closer:
Begin adopting cloud technologies that will enable your team to start meeting and making milestone decisions virtually, rather than in person.
Leverage 3D CAD drawings to minimize wasted time and physical sample materials in the early stages of the product creation process.
Ditch slide decks in favor of digitally organizing assortments and dynamically grouping products by details like material and retail price.
Break down data silos and accelerate stakeholder alignment by embracing a centralized digital workspace for all assortment-related data.
Improve business agility and strategic decision making using technologies that offer complex analytics and uncover meaningful insights.
MakerSights’ Modern Merchandising Maturity Model distills decades of retail experience, expertise, and success into five distinct stages brands can follow to streamline and accelerate their journeys to consumer-obsessed merchandising. Over the next several weeks, we will release dedicated content across these maturity model stages, each of which presents its own challenges, opportunities, and benefits.
Next up is Stage 3: Collaborate with Purpose and Confidence. This stage of the maturity model will share how brands can collaborate more effectively by centralizing quantitative and qualitative team feedback, focusing discussion on key points of contention, using internal data to drive productivity and objective alignment, and more.
To provide a little insight into what’s likely coming down the pike, we’ve rounded up the recent statistics that we think retailers should keep top of mind over the next twelve months. From operational efficiencies to digital transformation to responsible fashion, here are 55 stats that we believe are key indicators of what’s to come in the new year.
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