The opportunities to create an engaging retail experience

Etp-blog-the-opportunities-to-create-an-engaging-retail-experience

Gone are the days where retail used to be treated as a transactional business where in retailers sold the products to consumers who came to their stores to buy those and the mutual give and take of the product and the cost was the be all and end all. It has all changed now. While the transaction is still integral, it is just one of the many processes that make the retail business the way it is today.

A shopper not only buys a product from a retail brand, he/she wants to interact and engage with brand across certain stages of the shopping journey which has evolved into a complex, multi-dimensional journey that shoppers embark upon when they want to buy a product. This complexity has come in due to the influence of technology into the retail sector leading to substantial shifts in the shopping behaviour. The point to focus is not on the complexity but the opportunities that retailers have to connect with their end customers.

Consider this scenario – a shopper intends to purchase a mobile phone. So he decides to research about the options and varieties online on the website of his preferred retail brand. He is not happy with the options so he decides to further research on a market place online. Having shortlisted the devices that he could consider to buy, he visits multiple stores to check out the devices, to have an experience of their look-and-feel. Still not convinced of which one to go with, he goes onto social media and seeks opinions. Moreover, he also checks out information portals that review products.

Now, the above shopping journey is an incomplete one since the purchase has not happened yet, however it is interesting to note the number of times the shopper has interacted with the brand through multiple touch-points. From a retailer’s point-of-view, these are indeed the opportunities for the brand to interact and engage with the customer. The above scenario is one of the complex shopping journeys and the complexity can further increase along with the number of touch-points that can be used throughout the entire shopping journey. Again, these are multiple opportunities that retail brands have to interact and engage with the customer and create the impact.

To sum up, as shopping behaviour has evolved, it has provided ample opportunities for retail companies to go beyond the traditional concepts of retailing. Rather, this evolution has enabled brands to meet and greet their customers across multiple stages and touch points of their shopping journey. Ultimately, customers prefer an engaging experience and those brands who will be able to offer that kind of an experience will thrive.

Putting AI in Retail

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The human brain is more than just an organ – it is a complex system that helps humans to analyze information and take simplified decisions in various situations. But it cannot always gauge all the possible outcomes of a decision and hence our decision-making ability gets limited in certain circumstances. But what we cannot achieve with the powerof our brain is today being achieved by applying Artificial Intelligence (AI). It is much more than neural networks and complex algorithms; it involves enabling machines to take appropriate decisions in all possible circumstances.

With the huge amount of data being transmitted from electronic devices every day, it becomes imperative for the data-driven organizations to collect and identify a pattern in them. But, what exactly could be the advantage of collecting and analyzing data? Well, to predict the future it is necessary to understand the past and the present.

One of the biggest beneficiaries of Artificial Intelligence is physical retail. It is facing immense competition from e-Commerce portals, which not only provide user-friendly shopping experiences but also come up with relevant suggestions for future purchases. The need of the hour for physical retailers, therefore, is to revamp their business processes and come up with innovative measures to provide a more than satisfying customer experience along with an efficient stock management strategy. Artificial Intelligence (AI) can help achieve both. Here is a brief overview of how AI can help drive transformation in physical retail.

  1. Collecting relevant data: Data collection forms the backbone of AI. According to some of the industry stalwarts, “there can be no direct leap to artificial intelligence if substantial and relevant data is not being collected”. Most of the physical retailers lack the indigenous technology to collect and process large chunks of data by themselves. But that should not be considered as a hindrance to AI as there are efficient retail solutions like ETP V5 that can help them collect and process relevant and authentic data.
  2. Personalization: AI can be thought of as a complex algorithm that consists of all possible ‘if-then’ conditions. These conditions can be identified in various ways such as shopping cart analysis, payment preferences and surveys among others. The analysis performed can be used for managing product assortment, customer-specific promotions, and other loyalty programs. Personalization will ensure repeat footfall, which in turn will ensure a healthy bottom line.
  3. Supply chain and inventory management: If a retailer is able to collect relevant data, it becomes easier to maintain a healthy supply chain along with an efficient inventory management system. If the retailer wishes to sell the right product to the right customer at the right time and place, managing inventory across all channels becomes most important. This is indeed a mammoth task that can be eased out using an efficient Omni-channel Retail Solution like ETP V5 which can identify hidden patterns in the customer’s buying behavior and provide relevant suggestions to maintain the right inventory. Maintaining and managing supply chain and inventory are the backbone of a profitable retail venture.

AI has started revolutionizing the way in which physical retailers go about taking business decisions and with the enhancement of customer’s technical abilities, it can be safely claimed that AI will play an important role in the future of retail.

Omni-channel Challenges – Retailers need to tackle the risk

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The customer is at the center of the omni-channel retail experience. The new breed of shoppers – ‘omni-channel shoppers’ are demanding and how. They want seamless shopping across channels – offline, online, mobile, and so on. They want to switch between channels at their own will. They expect hassle-free transactions. And they want all this everywhere and every time. Catering to such kind of shoppers requires retailers to reinvent their strategies when it comes to omni-channel.

Omni-channel shopping is not merely transactional, it is the composite shopping experience where a shopper researches about the product, seeks peer opinions, purchases it, chooses a delivery option followed by after sales service. This entire journey might seem pretty simple but there are challenges that could become deterrents to the seamless shopping experience retailers need to provide to their customers.

One of the main challenges that retailers need to deal with is the random switching of customers between channels during any stage of the shopping journey. So the customer might wish to research online and buy in-store or buy online and collect at the store, and so on. There are endless permutations and combinations of how the customer chooses to interact and transact with the brand. This means the brand needs to be ready and available to the customer at the desired touchpoint and time that the customer demands.

The random switching between channels by the customers can further pose additional challenges. One such being that inventory information across channels needs to be updated and available for the customer to peruse. For example, if a shopper is looking online for a particular brand and model of a mobile phone, she gets the necessary information, compares it with another competitor and finds that the deal is better at the competitor’s end, she may just decide to switch loyalty. So, a lost sale!

Another important challenge is the availability of the product when the customer wants it. The retailer needs to handle order fulfilment according to the timeframe and the channel the customer demands. Order fulfilment has been one of the major issues retailers need to get right when it comes to omni-channel. The right technology can enable retailers to manage omni-channel fulfilment to meet all customer demands.

The essence of omni-channel is unifying all channels so as to provide a seamless customer experience but the multiple touchpoints being used are posing steep challenges. There are other challenges that retailers looking to omni-channelize their business are facing, they will be delved into soon.

Four Emerging Trends in this Revolutionary Era of Shopping

Everything about how the modern day consumers research, shop and purchase is changing, and established retail brands and businesses must learn to adapt. A new era of shopping has emerged leading to 4 trends:

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From ‘online-to-offline’ is gaining momentum – Big online-only players such as Amazon are increasingly eyeing and realizing the value of traditional stores to grow and generate profits. In the age of omni-channel retailing, it is insufficient for large e-commerce companies to exclusively sell online as brick-and-mortar stores are the go-to destinations where consumers get the chance to touch and feel the products. Hence e-commerce players are setting up their own physical stores to allow consumers to try products prior to buying, or they are partnering with local stores to enable shoppers to collect the products they have purchased online. The convergence of the physical and digital channel into a seamless omni-channel world is accelerating.

Stores stay relevant, important, but they are evolving – An online only retail world doesn’t seem to be a possibility and brick-and-mortar stores are far from getting extinct. Even today, offline stores continue to drive the overwhelming majority of retail sales globally. However, stores are no more merely places to make purchases; they are now evolving into entertainment hubs and social destinations allowing shoppers to explore and connect. This new wave of “experiential retail” is fast gaining momentum.

Delivery options are growing and time frames shrinking – Urban online shoppers today can expect same day deliveries and next day deliveries after placing an order thanks to retailers exploring new options of delivering packages more efficiently and economically. Retailers are trying to further reduce delivery time frames with the help of existing logistics partners or signing on with startups. And while groundbreaking technologies such as self-driving cars and delivery drones could revolutionize delivery, retail companies are using the right technologies enabling products ordered online to be collected at the stores in a matter of hours.

Shopping patterns are changing globally – None of the above trends are restricted to a particular region or a single market. Similarly, innovation is not limited to any one region. For example, China was where expansive urban delivery networks made same-day e-commerce deliveries common in large cities, and it was there that the term ‘online-to-offline’ originated. So also, in other retail markets around the globe, the connection between e-commerce and brick-and-mortar retail stores is swiftly growing in importance.

The bar for retail brands and businesses has been raised higher today than ever before and at the same time, business growth and increase in profitability remain elusive for even the most forward-thinking companies. In order to compete, retailers are getting more creative in their strategies of how they plan to leverage the opportunities of both online and offline channels. While doing so, they are thinking of redefining the in-store customer experience, preparing for rising delivery expectations and merging the online and offline channels so as to function seamlessly. Consumers are connected, technology savvy and well informed. They are demanding a rapid change and retail brands are responding. A new era of shopping has begun!

Online In-Store – Shopper’s Paradise

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Smartphones are getting smarter and making their users more savvy shoppers. Today, customers research, review, compare, purchase products online and in-store. Research shows more than 80% shoppers use their smartphones in-store, while shopping. The customer’s mobile is the starting point of most shopping journeys. It begins with searching about the various categories of interest. The search leads to the customer browsing deeper into the product information, while in the physical store, and ready to make the purchase.

Most shoppers use their phones to ascertain pre-shopping information like searching the store location and timings, comparing prices and understanding the store or brand specific promotions and ensuring the product availability at the store. Customers who use mobiles more often buy more. This is seen across product categories like health and beauty, electronics, home care and appliances. Browsing through substantial product information and reviews surreptitiously influences customers positively and removes any doubts regarding a purchase. Sometimes, customers also buy experience enhancing accompaniments for the selected products after reading about them online.

Mobile technology in retail is impacting a broad spectrum of business functions such as campaign and promotion management, customer service and acquisition, retention and loyalty management, space planning and optimization, operational processes, demand and supply forecasting, inventory management, security management, etc. Retailers are focusing strongly on mobile connect and analytics to gain actionable customer insights out of the enterprise data. For this, mobile technology like mPOS and beacons are being introduced into the retail store to deliver superior shopping experiences.