"Digital has been a major strategy for retailers for the past decade, though it means different things to different companies. But for almost all companies it has led to profit erosion. As the industry prepares for a difficult 2023 in the face of potential recession and other disruptions, retail leaders need a path to profitable growth through Digital-First Retail."
Matt Clark, Head of Retail EMEA at AlixPartners
RESEARCH
Turning profit destruction into customer and shareholder value
Digital commerce drove retail's growth over the past decade. But our analysis shows that as online penetration grows, retailers' profits shrink. The cost of serving customers anytime, anywhere, at any speed does not bring in enough topline growth to best monetize existing investments in machinery and technology.
Our proprietary research with World Retail Congress tells us:
- Retailers are spending big-but inefficiently-when it comes to digital, so they're not seeing the intended results.
- Many retailers lack an understanding of digital profit across the organization, which drives misaligned actions.
- Digital-first retail (DFR) is how to profitably evolve. It views digital not as a channel, but as the core of your business model, which is a completely new way of operating.
- Retailers must establish new KPIs with a digital-first lens to match their new operating model.
Click below to access the report and learn more about these implications for retailers.
CAPABILITIES
Digital-First Retail:
Online. Offline. Bottom Line.
Retailers continue to invest a lot to keep up with the omnichannel customer. But, for most, increased digital penetration is leading to shrinking profits-so their bottom lines stay right there, at the bottom. Until now.
See how our experts can help you quickly unlock profit.
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