1Technology and Retail
With Omnichannel strategy gaining ground in India, the retail sector, including Food & Grocery, is looking up to myriad innovations that will help to tap today’s tech-savvy customers.
The sector is responding to shifts in the consumer buying behaviour. However, consumer behaviour is changing faster than the number of channels opening up in the retail sector for addressing needs. The fight to claim customers has made the Omnichannel approach a must for retailers’ survival.
In the current scenario, the Omnichannel retail approach is arguably the sharpest arrow in the technological quiver that can win over the hearts and minds of today’s fickle-minded consumers. In this context, a study done by market intelligence firm Gartner reveals: It predicts that more than US$ 2 billion in online shopping will take place exclusively through mobile digital assistants worldwide by year-end 2016.
Another market research firm eMarketer projects online purchases will more than double to $3.551 trillion, or 12.4 per cent of total retail sales of $28.550 trillion, as more people come online around the world.
These tidbits of information should be a cue for charting the future course of action in the food and grocery retail sector. They point to the many key segments critical to the success of Omnichannel retail commerce, which need to come together in order to establish a conducive ecosystem comprising retailers, vendors, payment processors, mobile developers, data providers, advertisers, agencies and investors, and finally consumers.
The various interactions consumers have with digital media and digital platforms have rewritten the arc of the consumer decision journey, causing shoppers to become accustomed to a much greater level of convenience, choice and accessibility. The use of a variety of online-only features – such as personal recommendations, product reviews from other customers, huge product assortments and availability, and one-click everything – has given shoppers the power to make purchasing decisions much more on their own terms.
“Today, when the doors swing open to the temperature controlled confines of a store, shoppers bring many of these expectations with them,” says a leading retailer with both online and offline presence.
Meeting customer expectations holds the key to success in retail and adopting the Omnichannel approach appears to be a good bet in addressing the ever-changing customer expectations. Quite a few of these expectations are already being fulfilled and the bar for meeting such expectations is being set higher every passing day.
Modern retail is already taking steps to become a 24×7 proposition. Soon, delivery commitment will be curtailed to within 30 minutes or as per customers’ convenience or even lesser time than ordering a pizza. In fact, Amazon has been testing its 30-minute drone delivery idea for sometime now! So it could well be a robotic approach. Ordering products from the nearest possible location will be available on customers’ smartphones or even smartwatches. The line between offline and online shopping will become indistinguishable even as consumers will gain access to unheard of benefits and services.
3Removing Speed Breakers
India will have more than 200 million smartphone users in 2016, forecasts eMarketer. The smartphone generation is communicating more than ever through various means, mostly digital. This will spur the need for adoption of the Omnichannel strategy by tapping brick-and-mortar outlets, e-commerce and m-commerce together.
According to a study by Deloitte, no interaction with sales associates is now a preferred choice of shopping experience among consumers (i.e., automated approach for looking up prices, item availability, product information and in-store item location).
Additionally, the report says, they would also prefer to use unmanned in-store devices such as WalMart self-checkout systems (kiosks) and McDonald’s stores with touchscreen applications (digital displays). Needless to say, Omnichannel will augur newer concepts based on cultural outlook and technology penetration of a market. Going forward, expect the vast deposits of personal information in our mobile databases to be tracked down and analysed relentlessly for reaching out to customers.
4Apps Above the World
Retail outlets are getting digitized and in the future, augmented reality (AR) centric efforts will play a big role in winning customers. All information, activities, customers’ behaviour inside a store, etc., will be crunched and analysed for clues to predict shopping behaviour and consumption patterns.
Consider this. While passing a retail store (on your way from office), you get an SMS updating about the size of the T-shirt you have been searching online recently, and which is available at this outlet. No wonder, you will invariably make that purchase. The very next day, you will receive a discount coupon online for another purchase, which would be applicable only through outlet’s in-store app. This will lure you to download the app. Now, when you enter the store (physically or through this app), this app will guide you to all corners of the store to find a matching pair of bottoms for the T-shirt you purchased earlier. Thus, digitised retail store will be able to engage customers without any salesperson intervention. Retailers can even target individual shoppers with offers based on their personal profile data and previous purchase history.
Further, the option of virtual fitting rooms with interactive window displays will be reasons to satisfy customers’ greed to shop through smartphones. AR will draw attention and improve their experiences.
Omnichannel models can drive greater customer value in many ways. Customers can enjoy the convenience of online discovery and ordering along with faster hyper-local fulfillment, they can try products before buying them, they can access value-added services and expertise as part of their purchase, including returns or repairs. The overall shopping experience can be made far more delightful with greater assortment, transparent prices, no stock outs or long checkout queues, and frictionless payments.
Knowing consumers’ mood will help identify their desires and possible buying choices, which can be figured out using social media platforms. Facebook, Twitter, Google+ and even Linkedin will offer retailers the information about the mindset of their users and accordingly retailers will pitch products matching their disposition and inclinations. Online retailers like Snapdeal, Amazon, Flipkart, Myntra, etc., are looking forward to a high success rate using this strategy.
Keeping track of the customer pulse is critical. Customer expectations change with adoption of technology, and retailers will need to adapt accordingly. Also, staying abreast with innovation ecosystems and partnering with leading-edge startups is the key. Being a disruptor rather than being disrupted is the recipe for sustainable growth and relevance in retail, including food
If a retailer can get so much information about customers, imagine how each customer can enlarge the retailers’ business scope. Take, for example, the case of a guy who realised that he had forgotten to buy a gift for his fiancé on her birthday. With her birthday the day-after, he scrutinsed her gift wish list on Facebook and even contacted her friends to find out if her wish is still waiting to get fulfilled. And then, he ordered the gift through a digital marketing agency to get it delivered the next day. In future, this would be far easier to do.
In fact, through a virtual retailing platform, one can easily go to the nearest store to collect it personally, if he wishes to, or get it delivered to a specified address. Here, a retailer will have the opportunity to adopt robust order fulfillment practices (such as same-day delivery and click-and-collect), on-the-go retail, self-service centres (such as Amazon Lockers) and other non-traditional strategies. Moreover, the proposition of getting it exchanged effortlessly should also be considered to keep consumer loyalty quotient high.
6Targeting the Youth
Going forward, the retail sector will offer solutions that provide consumers’ instant shopping gratification. Retailers will invest more on robust order fulfillment systems and efficient customer service through various channels.
Talking about the youth, wearable gadgets will become increasingly visible in times to come. From smart watches, glasses to fitness monitors, many wearable gadgets will nudge the retail sector to try out innovative strategies where ‘customer connect’ can be achieved seamlessly. The spending on consumer wearable technology worldwide (report by Juniper Research) was tipped at US$ 1.4 billion by the end of 2014 and is expected to hit US$ 19 billion by 2018. If this is an indication to go by, retailers will definitely need to come up with solutions for leveraging on the information given out by wearable gadgets.
7Selling Through Social Media
While social media is a critical sphere that has diminished the distance between offline and digital channels, it is itself emerging as an obvious channel for retail commerce; for example, the ‘Buy’ button on Facebook and Twitter. It is helping businesses to drive sales through Twitter News Feed and on Facebook Pages. On Facebook, with this feature, people on desktop or mobile can click the ‘Buy’ call-to-action button on ads and Page posts to purchase a product directly from a business, without having to leave Facebook.
While customer loyalty is considered an important part of retail-consumer relationship, the framework of this relation will go through drastic changes. Retailers need to be imaginative in their reward programmes and give shoppers the benefits for their actions and engagements, rather than just purchases. Loyalty apps have already made inroads in this direction.
9Offline Approach for Online People
If customers can’t visit stores and are missing out on the shopping experience…no problem, the store will come to them. Yes, the merging of offline deliverables with online shopping would be an apt option. Here, customers will use in-store app to visit the store, just like the 3D video games played on smartphones, to go through the various counters, checking new arrivals, selecting the right size option, colour, etc., by using check-boxes. Then the virtual fitting room (discussed above) will help figure out how one will appear after wearing the purchased items. Buying process would be so much real even on the virtual platform. It will be a child’s play. Engaging with shoppers, both before a sale and during a purchase—online as well as offline—is going to set the norm for future retail.
10Merging Online-Offline Relationship
Omnichannel approach will force online entities in retail to bring out their brick and mortar stores. So, there will be a shift expected from online to offline side as well, which has started taking place. Hence, physical stores will continue to remain critical with a redefined approach to cater online consumer traffic. Various brick and mortar stores, hence, will act as warehouses or distribution centres. The inter-dependency of offline and online retail formats will only increase.
There is another instance that tells us how the relationship between online and offline retail commerce is blurring. In the West, customers visiting malls are getting attracted by interactive windows – digital storefronts, a good ‘shoppable window’ proposition, where customers can simply choose products and pay through PayPal or Paytm option. In fact, eBay did just that last year in San Francisco and New York. And, ‘Virtual Shopping Wall’ called ‘Scan N Shop’ at the Indira Gandhi International Airport in New Delhi is another credible example to go by. The online options are going to lure offline sales and vice-versa.
The need to make payment instantly will make mobile payment technologies come up with innovative ideas. In this context, the mobile wallet application market is something retailers simply cannot ignore. The Merchant Customer Exchange’s CurrentC, Google Wallet, etc., are some alternatives that retailers can look forward to.
11All in the Cloud
Cloud-based software solutions have been probably developed keeping in mind the Omnichannel requirements. For example, as a single entity NetSuite SuiteCommerce seamlessly connects e-commerce, order management, fulfillment, inventory management and point of sale (POS). Hence, it has a greater impact on the success of a company’s retail channels. Cloud is the future to gain a complete control over various operations involved in a retail business. The underlying fact is to integrate Omnichannel commerce, customer relationship management (CRM), inventory, order and warehouse management systems in the cloud and be available to customers everywhere.
The success probability of Omnichannel retail will rely on how easily, and possibly from a remote location, the various operations can be performed seamlessly. Those retailers who are ready to adapt to the technology-shift taking place in this sector will continue to remain on top-of-the-mind of their customers.