A quick check of my LinkedIn profile will reveal to anyone who doesn’t already know me that my career experiences are dominated by my role as a buyer for several well-known retailers — including one based here in Northwest Arkansas.
My experience as a merchant runs across both physical and digital retail. Because of that background, I have recently noticed some discussions in respected industry trade journals and social media about the concept of the digital-first product assortment.
Suppose your role in the retail ecosystem is tied to a consumer brand. In that case, you probably know that many brands choose to tailor their product offerings to the type of retailer they are serving, with both the product itself and the packaging, pack size and other elements designed to be successful at specific retailers or classes of trade.
At the same time, retailers often operate from a “base” product assortment that they seek to refine the size of the store, location or regionality, shopper demographics and other criteria intended to refine that base assortment for individual store locations.
These efforts, either by the consumer brands or the retailers themselves, are well-intended business decisions rooted in years of best practices in store-based retail that I believe should be challenged in today’s increasingly competitive omnichannel retail market.
As a retail buyer, I often would use our online platform as a test bed for products I might not be certain had broad appeal to our customers. I used our e-commerce business to gain insight into a new, emerging product or category while limiting the inventory investment to our e-commerce fulfillment centers instead of our hundreds of store locations nationwide.
The concept of a digital-first product strategy is now emerging as an approach that flips the script, if you will, with both product managers and retail merchants building a broad-based product offering online, where the physical limitations of store shelves combine with the opportunity to gain insights from a broader and more diverse customer base about their view on a given product line. This broader, digital-first strategy then enables the brand managers or retailers to refine their physical store assortment to the nuances of each store due to store size, format, geographic location, shopper demographics and more.
This approach has merit, in my view, because it uses the best elements of both physical and digital retail platforms to give the consumer a voice in what products are carried and where. It also provides data to both the brand and the retailer on consumer preferences and feedback on how to best design and refine product assortments across touchpoints.
Will this digital-first approach gain widespread adoption in the months and years ahead? We’ll see. I keep returning to one of my favorite Sam Walton quotes about change. Mr. Sam said, “You can’t just keep doing what works one time; everything around you is changing. To succeed, stay out in front of change.”
Would Mr. Sam be an advocate of digital-first product assortments? We can’t be sure, but his view on embracing change suggests that he might support the idea of a different approach.
Scott Benedict is the vice president of partnerships at WhyteSpyder, a Rogers-based member of the Ascential Digital Commerce Group focused on helping brands sell more on Walmart.com. The opinions expressed are those of the author.