Certainly there has been heightened dialogues around the digital impact on retail and retailers. These include areas such as social media, digital marketing, data intelligence and obtaining that elusive single customer view across the omni-channel. All have risen in priority as strategic considerations for retailers.
Following is a list of the 10 latest trends that are set to impact retailers in 2014 as they look to enhance their operations through technology.
1) Mobility the great enabler: Where do you start when reviewing the impact that mobile is having on retail? For 2014 see this as even more diversified in application. Deloitte Consulting released a study this year that claimed up to 21 percent of total retail sales were expected to be mobile-influenced by 2016. They went on to say "store-based retailers should consider mobile as a strategic imperative because it affects the entire business," the report went on to say "Mobile should be used as the strategic lever to boost sales across the business."
2) A renewed focus on supply chains and stores: With so much emphasis placed on online commerce in the last few years it’s easy to forget that 90% of consumer sales are made in store. Supply chain consistency and alignment are still posing a challenge for retailers, with integration between the channels sighted as the key inhibitor. In a study by RSR 42% of retailers are yet to have inventory and order management working across the channels and 37% claiming that their POS systems are too difficult to adapt or align with the larger Omni-channel strategy. The study also reported that 35% of IT systems were not designed to incorporate customer’s insights into the business processes. The result was that businesses are still spending more time on operational issues than on strategic planning initiatives.
3) Online with ‘drive through pick up’: This year saw supermarkets in France and England introduce locations where customers could pre order online and pick up in a drive thru environment (similar to a loading dock). In a trail this year Woolworth’s provided the option for Melbourne airport passengers to order fridge and pantry supplies up to a week ahead then grab them on their way home at a site beside the new public pick-up lane outside the Park Royal Hotel. Ms Langford Head of Online Business Development said Woolworth’s customers were increasingly embracing online and mobile platforms, with the company's online grocery sales growing 50 per cent annually. 2014 will see more suburban rollouts of the initiative for the group and other retailers as they try and increase convenience to customers.
4) In store visualisation: The face of bricks and mortar retail is in constant flux, especially when it involves technology and the avenues becoming available to retailers. For years augmented reality and personalisation were more fringe concepts than practical solutions. 2014 could be the year where that changes and the technology provides enough practical benefits for retailers to add them into their marketing budgets. Already in the US and Europe Lego is providing an augmented reality screen for youngsters to view a completed product as if they were holding it. Manufactures are adding virtual video games within cereal boxes to entice buyers and a number of fashion and watch retailers are enabling customers to try on items in a virtual and holographic displays.
5) Stores layouts are turning digital: A number of retailers indicated that they would be looking at altering the structure of their stores in 2014 with David Jones actually opening their first ‘Village Style’ store in September 2013. This Village Store is a new format that will feature digital charging stations, complimentary customer Wi-Fi, an interactive tweet mirror and customer dwelling areas along with dedicated in-store areas to purchase merchandise online as well as collect online purchases. It’s unlikely that there will be a big bang uptake from all level of retailer, but look at 2014 to be a year of adoption.
6) Online research is evolving: With so much information available online, 2014 is not only becoming noisier but making it increasingly difficult to source creditable, non-bias facts about product and services. Smart retailers are now starting to provide more thought leadership content through customer blogs and free programs providing value back to the market, without the direct marketing pitch. For example Lorna Jane is growing their customer base by building up advocates through their free personalised improvement programs. Websites like howstuffworks.com just put the facts out there, empowering customers to ask the appropriate questions. Look in 2014 for more retailers to evolve their message to the market.
7) Cloud enablement: Much has already been said about ‘cloud computing’ but with the increased velocity of customer touch points entering the market, 2014 stands as the apex point where retailers at all levels will be embracing cloud solutions or services on some level. Whether it be through overcoming technical challenges, structural changes, consolidation, high period loads and even tactical events such as pop up stores. Because cloud services increases the level of agility, it makes ecosystem changes easier to plan and provision for, which will be critical as retailers struggle to effectively and efficiently respond to their customers’ demands, speed and agility.
8) Data is the new oil: A number of key influencers in the retail industry have been bouncing this quirky phrase around lately. Supporting this is Gartner who have made two supporting predictions for the coming year. Business intelligence and analytics will be the No 1 priority for CIOs next year, followed by mobile technologies and ERP applications also that sales representatives that leverage data on a day-to-day basis stand to increase revenue productivity by 17%. Look for retailers to come to terms with what big data and reporting means to their business. Whether it be through capturing more tactical localised intelligence or implementing a business intelligence solution.
9) Single minded customer ecosystem: Following on from above the largest issue currently for SMB’s adopting customer relationship solutions (CRM) and business intelligence platforms (across the enterprise) is data integration. A study by integration specialist Scribe found that only 18 percent of retailers reported data as being fully automated within their CRM. As a result, there was an impact on targeted and automated marketing initiatives with 52 percent finding marketing reporting and 44 percent indicating sales reporting to be somewhat or very challenging. Look for 2014 to be a year that continues to focus on customer and reporting intelligence platforms and integration.
10) Me - the new brand: As we begin to embrace the consumer that is Generation Z, there is more a focus on how the brand adds value to them and their image. This means that more companies will be looking at how to empower their customers by releasing control of their brand and asking for input. Whether through creating new and unique lines or focus groups. Retailers will be looking to create more ‘brand partners’ in 2014.
Each year the challenge to improve sales, increase market share and better service our customers will be no different, but there’s no denying that the tech savvy customer is evolving and the retail landscape changing. 2014 is a year where we continue to advance our methods of listening, adapting and revealing new technology to our ever digitally connected customer.