Omnichannel

Doing more with less: Redefining productivity amidst economic disruption

With limited financial resources, it’s essential for retailers to be strategic in how they set themselves up for success in this climate. Here's insight on how the retail team can do more with less.

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June 29, 2023 by Jeff Griffin — Vice President of Strategic Accounts, Nfinite

Retailers are enduring the toughest financial year since 2020. Increasing labor expenses, rising cost of goods, and 18 months of interest rate hikes to consumers, which are decreasing consumer spending, have retailers scrambling for solutions amidst sharp budget and resource cuts to maintain profitability. More effort — and more creativity — is required to accomplish the same or better financial results with less expense.

With limited financial resources, it's essential for retailers to be strategic in how they set themselves up for success in this climate. The question on every retail executive's mind (and that I often hear in their offices) remains: "How can my team do more with less?"

Whether it's optimizing suppliers to reduce cost of goods sold, rationalizing under-performing brick-and-mortar stores, focusing smaller ad dollars on higher-margin items, or minimizing labor costs at headquarters, in the supply chain, or in stores, retailers are exploring all options.

Let's examine one core area — image creation used online and in stores — and how retailers can tamp down spending while elevating the customer experience and ultimately winning precious item, category, and channel share.

Are traditional methods worthwhile?

Most retailers rely heavily on photo shoots for product imagery, as they have for over a century. But long timelines, complicated logistics, and prohibitive, often unrecoverable costs make it difficult to meet the needs of today's retail reality. In fact, according to a report in partnership with Dimensional Research, 96% of retailers face ongoing challenges in creating imagery.

To successfully create most product images today, retailers must order product samples, scout for locations, hire a photography crew, and much more. The combination of these expenses, plus the unexpected changes and unbudgeted hurdles that always happen, often lead to retailers spending more than they originally allocated. Typical photo shoot budgets are over $500,000 per year, and 68% of retailers regularly go over budget. Continual over-spending for image creation isn't acceptable or sustainable, especially in today's climate.

The future of image creation

Visuals influence nearly every purchasing decision in the retail space, with 91% of retailers agreeing that great imagery has a clear, positive impact across performance metrics. But there has to be a better — and more cost-effective — way than traditional photography.

Enter computer-generated imagery. Leveraging this scalable technology as the primary method for creating product imagery enables retailers to avoid many of the pitfalls associated with conventional image creation.

With CGI, there are far fewer steps to reach final product imagery output, which significantly compresses timelines and ultimately shrinks costs. With just one 3D model, CGI enables retailers to create a multitude of images without a photo shoot. Think packshots from every angle (simple images on white backgrounds), lifestyle imagery (context-rich imagery that shows products across various inspirational settings and seasons), and 360°-spins, so the shopper can see the product as if it was in their home. The options are truly endless, and there is no limit to the number of images a retailer can create — all without a photo shoot.

Significant results on a smaller budget

And the results speak for themselves.

Retailers are producing imagery at scale while cutting net unit costs per image.

To put it simply, they're doing more with less. Retailers leveraging CGI are seeing 63% faster turnaround times while saving up to 85%. But they're not just moving faster and cutting costs (which are table stakes in retail today) — they're also living up to the consumer expectations we mentioned earlier, that have become more demanding. In fact, retailers like Delamaison have seen a 6% increase in total sales and a 66% increase in their add-to-cart rate.

To build or to buy

According to Coresight Research, 40% of retailers have invested in CGI capabilities for their business, while 58% have plans to do so in the future. With over half of retailers considering adoption, should retailers build or buy when it comes to CGI?

When creating an in-house team for CGI and 3D imagery, the cost is not limited to hiring new employees. Overhead costs and research and development account for a large portion of expenses when creating a 3D team, and these heavy capital allocations have to be weighed against supply chain, marketing, and other expenses that might yield nearer-term sales.

Working with a technology partner can provide more flexibility and lower costs — quickly — to generate high-quality imagery at scale. Retailers can worry less about constantly beating state of the art technology (typically not a retailer's core competency) and focus on creating more solutions to fit the needs of their customers, driving more sales with lower cost.

About Jeff Griffin

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