It is fair to say almost every industry has either already gone through or will go through a period of accelerated digital transformation in order to find their place in the new world but what triggers the need to embrace digital in your business? We believe it comes down to three things: 1) technology, 2) competitors, and 3) customers. Let’s look at each and explore how each could help shape the future of your retail business.
Operating at the speed of technology…
From virtual reality to drone delivery and smart payment systems to robots (whether in-app or physical), the pace in which technology is disrupting industries today is staggering. Being the first to market with a product or service is appealing to retailers as it provides competitive edge (more on that later), places your business at the bleeding edge of innovation and is attractive to senior stakeholders. However, it’s not always warm at the coalface.
Speaking to Retail Week, First Data Merchant Solutions general manager Raj Sond said: “The right technology can be the making of a business, but ill-equipped decisions when purchasing technology can lead to costly errors”. And there lies the challenge in operating at the speed of technology, the risk of it working long term to advance your business. For every Samsung Gear there’ll be a Google Glass, for every Facebook there’ll be a MySpace, you need to ask yourself: can you afford to back the first horse out of the technology gate in your sector?
Operating at the speed of competitors…
Competitive advantage is a boon for any industry but in retail it can make a real difference between success and failure. The impact of digital disruption and changing behaviors of customers on mobile devices has made it easy for a competitor to steal custom in your store yet alone on the street. This is terrifying for retailers and places “keeping up with – or ahead of – the Joneses” high on our list of motivations; but should it be there at all?
Following a lead doesn’t really give competitive advantage in our opinion and it pays to actually innovate to build reputation. Look at the example of Made.com’s unboxed social network. Rather than turning to technology or competitors, they innovated with cost-effective marketing and social media. The launch further strengthened their position in the interior design market whilst also strengthening their bond with our last category; the customer.
Operating at the speed of customers…
In 2009, the recession hit hard and transformed the way in which customers shop in such a way that the ripple effect is still being felt today. The customer has never held more power and this has been driven by digital transformation.
Whether using digital to paint a better customer picture, to serve them better or just connect your own customer touch points, it is our opinion that operating at the speed of the customer is the only true way to build a retail future. That’s why we work with retailers – with our guided selling solution to enrich the customer experience in-store and online every single day. That’s why we empower store staff to guide their customers to purchase and lock in their loyalty for the future.
Of course, it is possible to move your business forward with all three of the drivers we have talked about. Look at Walmart Labs, a innovative retail scheme that partners the supermarket chain with innovative technology ideas to gain competitive edge as well as focus efforts on helping the customer to enhance their experiences with the brand. An impressive holy grail but something most retailers need to build up to. How will your business move in the future? We’d be interested to hear from you.