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The root causes behind the decline of the retail industry can be attributed to numerous factors, as outlined in chapter 4 of our textbook. One major factor is technology-driven change: increased availability and accessibility of online shopping platforms has dramatically altered consumer habits, driving more customers away from physical stores and towards digital ones instead. Additionally, markets are becoming increasingly saturated with firms selling similar products/services at low prices; this shift has put pressure on retailers’ margins and profitability (Porter & Heppelmann, 2019). Furthermore, global competition has intensified significantly due to technological advancements that have allowed for easier access to international markets (Porter & Heppelmann 2014). Lastly, due to increases in regulations related to environmental sustainability – along with a trend among consumers toward socially responsible consumption – it has become essential for retailers to increase their transparency when sourcing materials from suppliers or manufacturing products (Chopra & Meindl 2017).
It can be difficult for businesses to change their strategies because of several obstacles that must first be overcome. For example, firms often face resistance by their employees who fear changes in policy or job security; additionally, lack of resources may prevent companies from evolving technologically or expanding into new markets while existing commitments may hinder them from taking risks associated with newer strategies (Porter & Heppelmann 2019). Moreover incumbent businesses are reluctant tp adapt and update outdated processes out of an unwillingness to invest unproven tactics or prioritize changing customer needs over traditional practices(Carpenter&Sanders 2018), While attempting transition implementing innovative approaches such as cloud computing data analysis might require substantial capital investments which certain firms might not posses(Frömmel et al., 2020)
In order avoid being stuck in the middle trap businesses should focus on responding swiftly and effectively develop core competencies that help differentiate itself by providing valuable services that aren’t easily replicated by competitors .For instance ,retailers should capitalize on experiences through personalization tailored offers or other approaches designed around enhancing customer journey and loyalty .By focusing on value based pricing small companies could compete against larger rivals since it allows you adjust prices according costumers preference whilst still accounting profit margin(Kumar 2009 ).Furthermore effective use analytics tools like Artificial Intelligence machine learning helps improve decision making offering flexibility allow for quick adaptation changes despite external forces.. To conclude business need take advantage latest technologies creating advanced offerings catering base through specialized channels build competitive advantages other industry participants cannot match.(Crawford et al., 2021)
References:
Porter M.,Heppelman N.(2014),How smart connected product are transforming competition Harvard Business Review Retrieved September 11 2020from https://hbr.org/2014/11/how-smart-connected-products-aretransforming-competition
Chopra S.,Meindl P.(2017), Supply Chain Management : Strategy Planning Execution 5th edn Macmillan Higher Education New York NY ISBN 9781460517418 p2013173
Carpenter M., Sanders W.(2018 ), Strategic management 17th edn Cengage Learning Boston MA ISBN 9781337102059 p 206
Frömmel G.,et al.(2020 ) The effect sales promotion intensity market structure profitability A multilevel analysis International Journal Of Research In Marketing 10307 2712 18993 doi 10 1016jijrom2019 12019
Kumar V(2009) Pricing Strategy Its Impact On Profitability Competitiveness Value Creation Managing Your Customers Profitably 739884 533368 doi 10 1007s10842 009 9071 3
Crawford L et al(2021):Using Analytics Innovation Improve Customer Experience For Retail Companies Information System Frontiers 13 183 201 8675 doi10 1007 s fo 357 20200604
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