The retail industry has changed for good since the pandemic, according to research from Chain Storage. Merchants must pivot around massive disruption and changing consumer expectations by introducing a hybrid-retail model, which blends digital and physical experiences so consumers can easily meet them, whether at home or on the ground.
Indeed, there’s no better time for retailers to undergo a digital shift than right now. According to the book The Future is Faster Than You Think, the world will change dramatically as a response to the next ten years of rapid technological disruption. Accelerating technologies like AI, robotics, and virtual reality will converge to transform today’s legacy industries. Naturally, these changes must be data-driven.
Big data analytics will be a pillar in future-proofing retail; by collecting, integrating, and processing data for granular insights, you remove the guesswork from the process. Here are four ways big data and digital transformation can help prepare retail for the next decade and beyond:
Improved customer experience
As we discussed in a recent article on Queuing Psychology, few shoppers want to stay at the checkout counter longer than necessary, and would prefer to spend more of their time looking around the store instead. City shoppers and traditional visitors alike want their shopping experiences to flow smoothly. If the experience doesn’t go according to their expectations, they just might avoid your stores right away. The key to meeting these demands is to utilize real-time information.
At its most basic level, sensors and Internet of Things (IoT) devices can collect information to make sure inventory — both on store shelves and in the stockroom — is complete and up-to-date to adequately serve on-site customers. Combined with Big Data, these technologies can further upgrade existing retention strategies by optimizing prices in real-time, forecasting demands, and monitoring patterns in consumer behavior.
Pygmalios, in particular, assists retailers in traffic analytics and queue management. Our experience has led us to analyze and forecast customer footfall patterns, outside traffic potential, real-time queuing behavior, and more. We help retailers better manage service areas and optimize floor-staff allocation based on actual needs.
Heightened personalization
Most modern consumers want personalized shopping experiences. Run-of-the-mill promotions and blanket discounts no longer work, given the vast differences between demographics; a study published in the Journal of Business Research reveals that customers value personalized discounts over general ones, as these offer a sense of delight. Retailers must tailor relevant shopping experiences for individuals, rather than groups. This can be done by looking at historical data, digesting it, and interpreting it accordingly.
Fashion and luxury stores illustrate how using Big Data can elevate in-store shopping. By allowing associates to use mobile devices to access client black books, they can provide VIP treatment based on what they know about a client’s preferences, past purchases, and wish lists.
Increased omnichannel presence
Author Steve Dennis recently discussed key retail trends from his book Remarkable Retail: How to Win & Keep Customers in the Age of Disruption on the Retail Revolution podcast. He mentioned that most consumers now shop through multiple channels, predominantly in eCommerce sites. However, he notes that the brick-and-mortar aspect is still essential because most products are shipped out from these stores. Moreover, brick-and-mortar stores remain business-critical touchpoints — not only because in-store sales are higher than online ones, but because they can offer interesting and memorable experiences for customers as well. Consumers come in, are wowed by the experience your brand offers in this physical space, and leave with a positive impression of you.
One rising trend that blends these touchpoints is the omnichannel approach, which unifies physical stores, third-party marketplaces, eCommerce websites, and mobile shopping apps for a seamless online-offline shopping experience. However, the right mix can be tricky to get exactly right without the right information about your customers. This is why it's important to have technologies that capture customer behavior, both online and offline.
For instance, a simple camera app can take photos and videos of store displays; these on-site images allow you to understand a physical space’s efficiency and performance. If you notice that queues are particularly long during peak hours, for instance, you can entice customers to shop online instead with website-exclusive promos. This way, you don't lose potentially impatient clients, you simply move them to a different channel.
Comprehensive insights on consumers
Consumer behavior is dynamic and ever-changing. Retailers are responsible for anticipating and accommodating their shifts in preferences. And the buyer’s journey has changed too. Before, research and price comparison were immediately followed by online or in-store purchases. Now, it has branched out to different channels like social commerce or pop-up shops.
With all these avenues to contend with, data is a retailer’s best guide. By mining information from transactional history, loyalty status, demographic details, and other figures that reveal customer buying habits, you can develop a useful, 360-degree view of each customer.
exclusively written for pygmalios.com
by Jessica Riley