Shop ‘Til You Drop

Common perceptions of technology are that it is something advanced, complicated, and futuristic. Technology is in fact a tool, and a valuable one at that. When used properly it can put a business ahead of all of its competitors. The use of technology in business models must be coupled with market knowledge and strategy. Business firms are always striving for sustainable competitive advantages in order to combat rivals and maintain, or improve, profitability. Use of technology, when employed correctly, can be lucrative for any business.

The retail company Zara has employed the use of IT enabled processes in order to be productive and generate substantial revenue in the competitive retail market. Shoppers are notoriously indecisive when it comes to making purchases. They tend to make purchases based on advice, and on what other people under the same circumstances have purchased. In other words, people tend to go follow the crowd. Who the trendsetters are is debatable, but this is why it is important to build a strong brand. The clothing industry is extremely competitive. When customers like a store’s inventory, look, image, price of merchandise, and shopping experience, they come back for more. Zara ensures that they give their customers a wide variety of options based on what the customers themselves have actually said they want. The in-store staff carry around PDA’s to record customer’s answers to interactive questions regarding the merchandise (Point of Scale System). The store tracks what styles and trends are most popular with their customers), this is called intelligence- gathering effort. Each Zara store is stocked with different items according to the local clothing preferences. It is this data that helps set Zara ahead, and only technology can help Zara gather this data in order to effectively put it to use through business strategy.

Another technology tool that retail companies use to attract customers is their store websites. Making easy to use and easy to navigate websites is very important for online sales. For example, Urban Outfitters generates great amounts of revenue from their online website. This is because it is set up to be simple and convenient. All of the products (shirts, pants, and accessories) are pictured against a plain white background. This allows the product to stand out and speak for itself. Urban Outfitter’s website also makes personal suggestions on items you may like and wish to purchase based on what you have already purchased and the style you seem to prefer. It is also based on what other customers who have purchased the same product as you have also purchased. This use of data and knowledge enables customer satisfaction and improves the number of sales. The website literally shows you items you may have missed or wouldn’t have seen otherwise if it had not made the suggestions.

Leveraging technology can be advantageous to stores because it improves quality and efficiency. Technology can be used to schedule employees, order inventory, and cut operation costs. The most important way for a clothing store to leverage technology is to improve customer satisfaction. After all, without happy customers there is no business. A company could be using the most high-tech gadgets and the latest and greatest tools, their operations costs could be minimal, the prices could be cheap, but if the customers don’t like the products there will be no purchases. Data and knowledge are the best weapons in the battle of the businesses.

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5 thoughts on “Shop ‘Til You Drop

  1. great post.. especially about Zara and Urban Outfitters’ use of IT processes in order to gain a competitive edge. Out of curiousity, do you know of any articles that discuss Urban Outfitters’ website? If so, please send my way.. I’d love to read more about its online approach!

  2. I agree with you. I think a clothing stores website is very important. From experience, online shopping definitely becomes more popular among college students as well as individuals with full-time jobs, especially females. It’s an easy fix for someone who cannot make it to a retail location. Not only does Urban Outfitters have a nice clean design and layout, it also has reviews for each product and detailed descriptions. I have been on clothing websites that lack the review sections. It is difficult to make a purchase when you have not tried on the clothes and cannot how other customers felt about it. The website, http://www.nastygal.com, is solely an online shopping site and lacks reviews. Although I have made purchases from this site, I would definitely have made more if I could see how others felt about the fit, color, etc. I’d be interested to know if there is a specific reason for this and what purely online stores strategies are.

  3. Excellent post! I certainly agree that the value of IT derives mainly from its application to achieve or enhance a specific business objective. For Zara, the use of data analytics allows the company to make a more educated assessment on product trends to follow. For Urban Outfitters, improvements in customer engagement management ensure a greater percentage of online browsers become online customers. In general, you’ve noted that IT improvements can fall across a spectrum of business areas, such as the demand side (i.e. customer-facing operations) versus the supply side (i.e. managing employee schedules).

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