Recently I outlined some of the top trends I see in retail today. They all have something in common, and it’s a common theme within the marketplace and the media coverage of our industry: Digital Transformation.
The reason digital transformation is so important right now is obvious: smartphone-enabled consumers gather information and shop anytime, anywhere – and they’re not just using those smartphones. They switch between channels as they see fit, from tablets to computers to smartphones to brick-and-mortar, and they expect retailers to keep up with those increasingly complex purchasing journeys.
The Consumer Perspective
Retailers clearly understand that technology is an enabler for greater interaction with consumers, and we’ve seen the evolution of social media that aims to inspire consumer engagement. In fact, according to PWC analyst research, 80% of retailers rate technological advances as one of the top three global trends that will transform their business over the next five years.
But what, exactly, does that mean at a very tactical level? It’s much more than simply introducing new touchpoints for consumers. We have to work together to enable current and new touchpoints in ways that drive a consistent brand experience and offer additional value. I’m talking about omnichannel experiences that transcend a single channel, and help create seamless, intuitive experiences for your consumers. For example:
- Online booking for in-store appointments.
- The ability to accept in-store returns of products purchased online.
- “Click & collect” options that offer free shipping to a store for pick-up.
- Online reservation of certain items, to ensure they’re available in-store when consumers are ready to shop.
- A single digital shopping cart across all touchpoints.
These solutions are rooted in technology, to be sure, but their reach is far more than a single channel – they aim to empower, enable and engage consumers by weaving channels together in ways consumers expect.
The Employee Angle
Now, let’s change the perspective. How can technology enable store employees to support consumers even better in their purchase decision?
- Mobile devices that empower the store staff to trigger queue busting alerts that ensure the right number of service lanes are open for faster checkout.
- Equipping fitting rooms with devices that interact with the store staff – this facilitates continuous and responsive consumer service from the moment they enter the store, right through to checkout.
- Location-based service alerts allowing consumers to request help and retailers to send expert staff to enable a more efficient and satisfying shopping experience.
- Real-time consumer data delivered via “Internet of Things” (IoT) devices that enable brick-and-mortar retailers to immediately respond to consumers’ demands – in the same way online retailers have always done by displaying targeted offers based on historical shopper data.
- Mobile POS systems, beacons or virtual mirrors that help retailers allocate staff in the most effective way.
- In-store online shopping portals and self-service kiosks that enable and trigger additional purchases and product research.
These opportunities all center on improving consumer engagement and better service. But there’s one more crucial component that cannot be overlooked.
The Back-End Connection
To get the maximum benefit out of digital transformation, retailers can’t simply implement new consumer-facing technologies. They’ve got to think strategically about restructuring and updating their back-office processes.
Currently, many retail organizations run at two different speeds: very fast in the stores, but a lot slower in the back office. Outdated and complex operational back-office processes are often a blocking point for a seamless customer experience. In fact, CapGemini forecasts the next big revolution in improving the consumer experience will take place in the back office, at the operational level. That’s why, at Diebold Nixdorf, we’re focused on collaborating with retailers to understand and prioritize the processes that need upgrades, and create an actionable, step-by-step approach for implementation.
Having all the technological advantages in mind that I just covered and looking at how your own personal shopping behavior has changed in the last few years, you might still question the future of brick-and-mortar stores. Let me give you some clear answers here: Today’s shoppers have access to multiple channels and touchpoints to make final purchase decisions or conclude a transaction. But far from cannibalizing store traffic and turning stores into showrooms, there is clear evidence that online product research drives consumers to stores! PWC found that 23% of consumers who researched consumer electronics online went to a store to buy the product, compared to only 2% who did it the other way around.
The fact is, modern consumers do not just shift their spending to a different channel. Roughly one in five respondents in that PWC study admitted to spending 25% more with their favorite brands as those brands offered their products and information in more channels.
So while consumers needs can be divergent, this is crystal clear: The store remains in the center of consumers’ shopping activities. But the way retailers interact with consumers must change tremendously. Consumers who come to a store might know exactly what they want to buy, or they might look for some inspiration and a tangible experience that cannot be provided online. Retailers need to know these requirements – ideally from existing consumer data – and they need to be able to respond in ways that are targeted and seamless.
This is the foundation of our business objective: to help retailers around the globe enable integration of different sales channels, driving consumers to stores and supporting a more robust and fruitful purchasing journey. Let’s talk about how our services and solutions can drive a successful digital transformation across your retail network.