11 Apr A new age for retail
A new age for retail
The current pace of change and innovation within the retail marketplace is verging on a revolution. On the one hand, organisations such as Amazon are challenging existing business models and engaging customers in new ways. While on the other we have increasingly empowered consumers who expect a seamless brand offering across an ever-growing range of channels – and they want it now!
As I wrote about in Internet Retailing recently, digital transformation is redefining not just how retailers communicate with their customers, but entire business models too. Indeed, digital transformation and data intelligence are central to creating a customer-obsessed model, something which is particularly important in this ‘age of the customer’.
From mobile applications to ecommerce platforms, the Internet of Things (IoT), and, more recently, AI and VR, ever advancing digital technology has led to a fundamental change in the way retailers interact with consumers – and vice versa. Yet this is only the beginning.
All of this presents a multi-faceted challenge to retailers. Not only are they attempting to embrace new operating models and approaches in order to stay competitive and stave off disruptive forces, they are also faced with a wide array of technology to choose from, as they attempt to both navigate new terrain and implement new systems to take advantage of burgeoning technology such as AI.
For heritage retailers in particular, with large legacy technology systems, this can be particularly challenging.
However, retailers need to ensure they have the basic building blocks in place in order to get real benefit from any technology they purchase – and indeed to get benefit from the technology they already have! What is often overlooked is the hugely important role data plays. Nearly every new trend such as AI, cognitive computing and IoT has data at its core. Sure, data is not as headline grabbing as the above-mentioned technologies, but none of them are possible without access to, and good integration between accurate and relevant data.
Don’t start with technology
Start with the customer experience, not with technology. All too often the tendency is to try and solve a need in the quickest way possible by throwing some technology at it. To really get value, retailers need to step back and start with the customer. Understand how your customers are interacting with your brand, how they are likely to in the future and also ask yourself: what disruptions are there in the market that might change the way they do?
Build a roadmap and keep it agile
Developing a technology roadmap that encompasses the entire business and is supported by the entire senior management team is hugely important. This can help to avoid questions over which department ‘owns’ a particular technology project, as they all will. Built into this roadmap should be incremental targets, some of which can be delivered quickly in order to demonstrate value up front, as well as clear objectives that the business can work towards.
These ‘quick wins’ are critical for demonstrating the value of a system and getting that all in important buy in. This stage should not be underestimated, particularly as businesses are placing more pressure than ever before on the return on investment.
Once an overarching business roadmap has been established, organisations can then tackle the issue of whether they have right people and processes in place to execute it.
Getting your digital estate in order
Retailers are still failing to fully understand their digital estates and the systems they already have. Many are fairly digitally mature, with estates that have grown at a rapid pace and are likely to have multiple systems in place, which are not being utilised or integrated properly.
In addition, each silo is in various stages of maturity when it comes to technology. Further compounding issues is the advent of the cloud, which has led to a greater ability to operate outside of an IT function and therefore not have to communicate across business functions and other silos.
Using technology to provide a seamless, engaging, personalised service to customers is within reach for retailers, but the majority still have much work to do to achieve this goal. However, by taking key steps to implement an operating model that puts the customer as the centre, establish an overarching business technology roadmap, tackle silos and use data more effectively, retailers will start to reap rewards. It is not an easy task, but with the right support and expertise, it is achievable.
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