The future of retail

Welcome to the future of retail. E-commerce represents almost 20% of total retail sales worldwide, and the share is expected to rise to 25% by 2026. Forrester predicts consumer spending will increase by 5 % during 2023 despite the ongoing recession.

Digitalisation has changed consumer behaviour by creating a more connected, empowered, and informed customer. Consumers can easily access product information, compare prices and products across multiple brands and make purchases anytime. They demand more personalised experiences across all touchpoints and expect brands to use technology to provide added value.

As a result, direct-to-consumer retailers must adapt their strategies to keep up. To meet customer expectations, they must continuously evaluate and improve their operations, technology, and customer experience.

“The speed of change is massive. One main challenge is meeting the changing demands and growing sustainably while preparing for the future, also technology-wise. How can retailers pivot early enough? Do they have the right operating model, data, tools and expertise?” asks Maurus Puttonen, Retail, CPG and Logistics Industry Lead for Fluido.

Streamlining retailers’ existing operating models and processes for omnichannel commerce requires a strategic and technology-focused approach. But the rewards, in the end, are significant: it can drive improvements in efficiency, customer satisfaction, and revenue growth.

Real-time decision making

Adopting technologies such as automation, AI, data management, analytics, and cloud services help retailers become more agile by reducing manual processes and enabling real-time decision-making.

“Start from the data. What kind of information from the different touchpoints can you get, and most importantly, what do you need to have? What is the meaning, value and cost of those touchpoints in terms of customer experience and your core KPIs? And do all the different company functions have visibility into the data and the ability to act accordingly? These are the questions to ask oneself,” Maurus says.

Also, companies can understand customers’ preferences, behaviours, and pain points by collecting and analysing customer data. They should use this information to personalise their engagement and improve the customer experience.

Customer data, such as purchase history and preferences, should be shared across all channels, allowing for a more personalised and convenient experience. For example, if customers start shopping on a retailer’s website and then switch to their mobile app, their shopping cart and preferences should carry over. Additionally, a customer should be able to return an item purchased online in-store and receive customer service support through any channel.

Personalised marketing at scale

Digitalisation has enabled personalisation at scale, allowing brands to use data and AI to tailor their offerings and communication to individual customers.

“I believe that AI will become a more natural part of marketing automation and will provide remarkable efficiencies, especially in content production. Content production is still one of the most time-consuming parts of personalised communication. Reducing the time spent on that will provide clear benefits for marketers”, says Milla Hallanoro, Marketing Automation Practice Lead at Fluido.

Personalisation helps customer loyalty by creating a more meaningful and satisfying customer experience. Personalisation can be achieved using customer data, such as purchase history and preferences, to tailor interactions and offerings to individual customers.

“Leading brands use personalised communications to provide experiences that feel tailored to each individual. They have built a strong data foundation that allows them to understand their customers’ needs closely and react rapidly to changing customer needs. These organisations are also agile and capable of reacting fast to the changes in the market, like new emerging channels or new data regulations,” Milla adds.

Seamlessly omnichannel

Even with the technology existing for a long time now, many retailers struggle to provide a seamless customer experience across online and in-store shopping.

True omnichannel integrates multiple sales channels, such as brick-and-mortar stores, e-commerce websites, mobile apps, and call centres. The aim is to provide customers with a consistent, seamless shopping experience regardless of where they are.

“Retailers must provide a frictionless, consistent and personalised omnichannel customer experience for the entire customer journey. This starts from the first time the consumer is exposed to the brand, for example, in advertising to a visit in-store or in ecommerce, all the way to the last mile. And even until using the actual product,” Maurus says.

An omnichannel operating model is becoming increasingly important as customers expect a seamless shopping experience across all channels. By providing a consistent and integrated experience, retailers can increase customer engagement and loyalty and drive sales and revenue.

Conclusion

Retailers can streamline their existing operating model and processes by adopting technology solutions and leveraging omnichannel to ensure a seamless customer experience across all touchpoints. Additionally, retailers can use customer data to personalise their offerings and communication, increasing customer engagement and loyalty.

Organisations also need to be able to adapt quickly to changing market conditions and customer needs – but also to know where to focus.

“Acting fast is crucial, but the actions taken must also be sustainable in the future. Building digital capabilities and skills within the organisation and the partner network are future-proofing the whole business,” Maurus concludes.