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    What Are the Biggest Ecommerce Challenges for Brands and Retailers?

    March 22, 2022
    6 minute read
    What Are the Biggest Ecommerce Challenges for Brands and Retailers?

    The traditional dynamic between brands and retailers has changed. Brands and retailers are struggling to keep up with today’s world of infinite shelf space and consumer-driven search. 

    Many businesses are relying on a playbook written for brick-and-mortar commerce.

    To survive — and thrive — brands and retailers must identify, adapt to, and overcome these emerging ecommerce challenges that prevent them from offering the best consumer experience possible. 

    Salsify has identified three of the top commerce challenges brands and retailers face in its new report, “Breaking Down the Barriers to Winning Commerce.” 

    Here’s a deep dive into three major roadblocks to delivering the seamless commerce experiences customers demand — and tips on how brands and retailers can collaborate directly to overcome them.

    Retail Realities in 2022 

    The line between brands and retailers has blurred in the wake of rapid ecommerce adoption and changing consumer behavior.

    For example, many brands have taken on the responsibility of managing their own merchandising strategies and deploying customer relationship management (CRM) solutions to connect with customers directly. 

    Retailers, meanwhile, are taking on more brand-like characteristics with the rise of private-label products and third-party (3P) selling.

    While public health restrictions set the stage for this shift, improved customer experiences quickly took center stage as consumers realized the benefits of being able to purchase exactly what they want, when they want it — and then have it delivered directly to their door. 

    This experience is now so critical that 46% of U.S. shoppers will abandon potential online purchases if there’s not enough information or details provided.

    It’s no longer enough for brands and retailers to meet the bare minimum when it comes to cultivating customer relationships and driving consistent sales. Consumers are looking for shopping experiences that go above and beyond. 

    Brands and retailers need to take the following three ecommerce challenges into consideration if they want to deliver the digital shelf experiences today’s customers demand.

    Challenge #1: Exchanging Data Is Costly

    The exchange of product information from brand to retailer is central to the success of omnichannel commerce, which means brands and retailers can no longer afford to pay fees to intermediaries that don’t add value and slow down time-to-market.

    Companies face significant costs when it comes to moving data. Shifting product details from brand to retailer — and ensuring this data is accurately represented in online ads, print circulars, and in-store marketing materials — often involves the use of intermediaries who charge substantial fees for moving data from place to place. 

    Walled gardens also pose a significant challenge. When retailers work with third parties to obtain data, they intentionally block brand connections, which ultimately degrades the consumer experience.

    While these approaches made sense when most assets were physical, digital-first markets offer other options for brands and retailers to reduce their costs and improve efficiency, such as the use of peer-to-peer networking that empowers direct connections and data sharing between brands and retailers. 

    Put simply, collaboration — not competition — is now the key to sustained growth.

    Challenge #2: Brand Silos Are Getting Bigger

    Brands also face internal challenges around operational silos because organizational structures that made sense in a physical-first commerce model can’t keep up with the speed of digital shelves

    With consumers now expecting a seamless, omnichannel experience at every touch point, there’s no time to waste when it comes to distributing data from production teams to trade teams to marketing and sales teams. 

    In practice, overcoming this challenge involves internalizing and centralizing decision-making across teams to improve visibility, optimizing product portfolios for both shoppers and retailers, and recognizing the need for budget fluidity as consumer needs change.

    Challenge #3: Retail Silos Are Creating Barriers

    Retail companies also face silo-based barriers. From outdated operating hierarchies to cumbersome budgeting processes, legacy approaches and technologies now create conflicts for retailers looking to deliver personalized customer experiences that meet consumers exactly where they are.

    Solving this challenge requires a reworking of internal structures to eliminate one of the most common operational silos: IT. 

    Historically tasked with managing all aspects of technology deployment, data collection, and digital strategy, IT teams are now critical to line-of-business functions across the organization — but they don’t have the time or resources to handle product, price, and personalization on their own.

    Instead, retail teams must collaborate to create new data-driven omnichannel experiences. By making consumer experience, data control, and digital commerce a shared responsibility, retailers can start eliminating silos and driving increased sales.

    Navigating What’s Next

    supply chain, public safety, and staffing issues create new ecommerce challenges around data exchanges and operational silos.

    While this landscape is daunting for retailers and brands alike, it’s not bad news. With the right approach to data collection, curation, and collaboration, companies can better navigate what comes next and come out ahead in the new world of customer-driven conversion. 

    Check out Salsify’s new report, “Breaking Down the Barriers to Winning Commerce,” to learn how to overcome the three primary barriers to commerce and set your path forward for success.

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    Written by: Doug Bonderud

    Doug Bonderud (he/him) is an award-winning writer with expertise in ecommerce, customer experience, and the human condition. His ability to create readable, relatable articles is second to none.

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