How can retailers rise to the challenge of the growing demands for digital?
Earlier this summer, we descended on The Gilbert Scott in London’s St. Pancras with some the leading thinkers in the industry to tackle this very question.
CTOs, founders and brand managers from John Lewis, Google, Jeetly, Doddle, Dressipi and BookingBug all attended, taking part in a discussion around how retailers can meet the growing needs of the digital first consumer.
What soon became clear is that despite retailers already making great leaps to embrace digital technology, consumer expectations of digital services are changing fast. This means ‘new’ digital capabilities are quickly becoming outdated.
This chimed with our own Digital Inside Out research, which found one in four consumers always choose a digital option in retail when it’s available. And, with consumers now using an average of five ‘connected’ devices during the purchase process, compared to 2.8 devices a year ago, the hunger for digital services shows no signs of slowing down.
Integrating online and offline
A key point that came out of the discussion is how retailers are grappling with the nuances between online and offline.
For the customer, they don’t care if retail is one or the other – what matters is the overall experience. In order to be successful in this fast-paced environment, retailers have to join-up online and offline seamlessly, across multiple devices. Retailers that bury their heads in the sand run the risk of falling behind of their competitors, so a cohesive approach is needed.
One of the most prevalent challenges retailers face is knowing which digital services to implement and at what stage in the buying process to satisfy the needs of today’s digital-first audience.
Another area to consider is people are now much more informed around purchasing decisions as a result of digital. Deals have been researched before they walk in-store, so people know what they are going to buy. Some are even doing this while they are shopping – a trend known as show rooming.
Ultimately, consumers adopt digital services to simplify the retail purchase process so retailers need to invest in digital capabilities that will enhance the customer service experience. This is as opposed to investing in aesthetically pleasing digital initiatives that offer no real business value.
Using digital to reach the right audience
Another area the changing use of channels for reaching different audiences. There was a consensus around the table that the younger generations no longer use email to communicate. On the other hand, digital doesn’t work for large parts of the older cross-sections of society – but it also cannot be ignored altogether.
But the key thing which many retailers still need to grasp is the missed opportunity around data capture – another nuance between online and offline.
This can make marketing much more targeted, and customers being dealt relevant information at the right time. It’s much more impactful, and it can give a tangible return on investment.
Getting the back-end systems right
Unfortunately, retailers can also fall into the trap of implementing digital elements as an attempt at embracing digitalisation, without consideration for the back-end infrastructure.
Investing in elements such as screens in-store may appear to be ‘digital’ however, it’s important to take a step back and ask yourself – ‘how will this enhance the customer experience?’
If retailers for example synchronised the back-end business with online serviced, in order to track and monitor stock levels and deliveries in real time, the return of investment would be clear.
Legacy systems are enshrined in a business operation, so change does require time and investment. One of the biggest considerations should be linking together siloed systems with the goal of improving customer experience.
For the established names on the high street there is a risk that newer players entering the space leapfrog those with dated systems.
Being proactive about investing in innovation can be the difference to a retailer’s long-term success; however this is met with a squeeze on budgets that can make digital innovation difficult. The majority of IT budgets are there just to keep the lights on, but more and more brands are becoming IT literate and realising the need to embrace digital this is changing.
In my view, there has to be a balance that reflects creativity and innovation.
Retailers who want to succeed in the digital realm will need to create a balanced offering that both satisfy their customers need for digital services and future-proof s their business model.
Those who fail to adopt these strategies, across all the available channels being used by their consumers, will find it increasingly difficult to secure their digital future.
Check the latest issue of Retail Systems (July) to read further coverage of this roundtable event.
Image credit: Snapwires via Pexels
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