Few industries employ as much technology as the retail sector. Consumer-facing tools, apps, and fast networks are now the fabric of how merchandise is moved and customers are served. As cloud-based computing has expanded, so too has the risk. So what are retail innovators doing to gain more visibility and minimize risk while still leveraging the right technology?
Technology Is Accelerating Omnichannel Strategies.
Omnichannel, which aims to create seamless shopping experiences regardless of physical or digital environments, is becoming more the norm as technology and networks grow smarter and faster. But even with the best tools, it can still be a slippery slope. As customers have more channels and ways to interact, it becomes harder to establish loyalty. PwC’s Strategy& described the scenario in a recent piece on industry disruption.
“The brick-and-mortar store no longer commands consumer loyalty. Retailers that offer a more seamless and integrated experience between their physical and online stores — taking the so-called omnichannel approach — have better, but mixed, results. In general, people are more willing to shop around for better prices and services on the Internet than they were when they had to use the telephone or travel from store to store. Customers are also more inclined to buy from multiple vendors instead of a single outlet, and are more likely to switch to new suppliers if they are even minimally dissatisfied.”
The good news is that ominichannel is finally becoming a catalyst to bring together the tools and platforms that have been disjointed for so long. All that integration will also bring more data to enterprises and in some cases, new views of that data. That’s where software like Domo can make real inroads. By providing context for large amounts of data, it becomes clearer what to act on, which shrinks time-to-market.
Brick and Mortar Stores Are Closing The Gap With Ecommerce.
Beyond omnichannel, the rise of smartphone and tablets has also leveled the playing field between brick and mortar and ecommerce. Research from Deloitte Digital shows digital device usage continues to rise year after year.
And it’s not just connected smartphones, it’s all sorts of integrated and smart digital devices and machines that not only make up the internet of things (IoT), but allow platforms to become more efficient and automated.
Consultancy McKinsey reckons the IoT is the next big technology wave for retail, hot on the heels of information technology’s twenty-year run. The automation it brings to retail is chipping away at cumbersome processes and rigid systems. As software bridges these gaps, the IoT will create more ways to easily connect with customers. The challenge, however, is that maintenance will increase, as will the dependence on third-party networks and other hosted applications.
Retail environments have undergone significant change over the past two decades due to the introduction of information technologies, including the rise of online shopping. The Internet of Things has the potential to cause even greater disruption, but IoT can also provide traditional retailers with the tools to compete—and coexist—with the online retail world as “omni-channel” shopping erases the distinction between online and offline shops. The Internet of Things, for example, can guide the shopper to the item she has been looking at online when she enters the store and text her a personalized coupon to make the purchase in-store that day. IoT technology can also provide data to optimize store layouts, enable fully automated checkout, and fine-tune inventory management.
As transformative as the IoT promises to be, having the right processes in place to get to critical data will still be the priority. This is the area where business management platforms like Domo can have real impact — where new processes are driven by the mixing and matching of key data sets. McKinsey writes that “IoT adoption in the retail setting will depend not only on the evolution of technology (lowercost sensors, for example) but also the development of new business processes. IoT systems require modern store formats and investments in data systems and electronic payment systems.” What that should tell you is to invest in the right tools that can quickly bring together disparate data, regardless of where the data reside.
“Bottom line: Sometimes the most important data is the data that businesses don’t know they have.” via @Domotalk #Domo
Marketing Strategies Are Changing Just As Fast As Technology.
It’s a given that software will continue to eat big pieces of the retail environment. But as fast as things are moving, smart retailers always have a grasp on how to balance everything. A decade or ago it was personalization. Before that, it was one-to-one marketing. Whatever the strategy du jour, one constant will be the how-to’s of engagement. Nielsen’s Patrick Dodd, president, Nielsen global retailer vertical, wrote about the connected shopper recently, and touched on engagement as the critical piece in a complex puzzle.
“In an increasingly complex retail environment, engagement is the emerging skill to master. Retailers must move from a linear marketing approach to a value exchange model in which customers receive a tangible, personally relevant benefit for their time and attention. This becomes even more critical as location-based services become more prevalent. Consumers will be quick to distinguish marketing messages that are simply trying to sell from tools that actually help their shopping efforts, such as advanced order placement or mobile price-matching features. Consequently, having the right assets and insights is necessary to fuel context-aware engagement.”
It’s the last sentence that’s so intriguing. When Dodd mentions “context-aware engagement,”he’s touching on what has been so elusive for so long: who needs what information and why? As our technologies continue to whittle down silos, improve collaboration, and keep us and our machines connected, we may finally move towards real solutions — and less riskier ones.