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How Digital Transformation can improve the Retailing Experience

How Digital Transformation can improve the Retailing Experience
December 20, 2017

Co-Authored by : Girish Tiwari

Digital transformation has emerged as a major disruption, forcing retailers across formats and demography to adapt to key elements of this massive change. Digital transformation is about moving from incremental changes to integrated processes, yielding transformational changes in terms of customer experience, business efficiency, and innovation. At the same time, new-age consumers are becoming more and more reliant on social media and mobile devices, especially for their retail choices. This is resulting in consumers becoming more demanding with regard to user experience, forcing retailers to align their business operations per customer requirements and wish lists.

Digital Transformation - A disruptive force changing the Retailing Experience

The retail customer journey starts from the customer engagement phase to product discovery leading to actual purchase followed by post-purchase services. There are various elements in digital transformation that have a direct impact on end-customer experience for each of these phases. In sections below, we will look at each of these phases and how these are getting impacted by digital transformation, resulting in an enhanced retail experience for end customers.

Customer engagement: Customer engagement earlier used to be a one-way communication dependent on mass media such as TV, banners, and events. However, with the advent of the digital age, mobility has taken on a fundamental role in our daily lives. As such, in the age of digital transformation, customer engagement has also fully embraced the mobile. Coupled with implementation of Big Data, retailers are now able to provide a very personalized touch to their engagement initiatives with their customers. This could be in the form of individual offers, personalized marketing messages, or relevant promotions for the customers. To end customers, this has resulted in ease of access and getting information that is relevant to their individual needs.

Product discovery: In an earlier era, product discovery was guided by a clear set of recognized needs. Consumers had few channels to get to know about the product. Most of the time, consumer-buying decisions were influenced by word of mouth or face-to-face interactions. Digital channels like the internet and social media have made it easy for customers to get information on their buying needs. Product-based reviews available on the internet and social media make it easier for customers to make informed decisions. With the advent of digital transformation, consumer needs are now created on the go at the point of discovery – not just restricted to the physical or virtual channel, enabling common public places such as bus and train stations to act as points of sale. Interconnected digital media and interactive displays provide relevant context-aware messages leveraging new technologies such as IoT, deep learning, AI, and CI pinpointed to customer requirements.

Purchase: There was a time when brick-and-mortar stores used to be the only option for purchase and pickup. There were constraints of limited payment options as well. With the beginning of the digital age, customer purchase retail experience improved by enablement of multichannel transactions, self-checkouts at stores, and digital cash options like PayPal, Starbucks cards, etc. Digital transformation has taken this further where omnichannel has become mainstream, ensuring that customer experience is uniform no matter what the device.  Stores are now able to provide customers with features such as click and collect, buy online, and return in-store, and ship from store to customers as physical and digital channels increasingly integrate. Digital wallets have become a reality, allowing customer purchases online from a computer or smartphone at the store. Contactless payments from credit/debit cards, key fobs, and smartphones using RFID or NFC provide faster means of transactions to customers. An interesting trend is the entrance of unlikely players in retail fulfilment area such as Uber Grocery delivery service, a service pursued by retailers such as Walmart and Kroger as well. Retailers are also keen to transform their stores into customer experience centers through in-store interactive kiosks with embedded voice or video functions, touch screens that provide customers with full range of available products, displays that offer product information, recommendations, and virtual fittings, and well-informed store staff using data on individual customers’ preferences and buying habits creating a customized in-store experience. All of these in-store digital solutions are transforming customers’ shopping experience.

Post-purchase:  Earlier, servicing used to be tiresome for the customer with multiple touch points. With digital transformation, points of sale not only get converted to points of service but further transform with proactive insights to delight customers. Typical service engagements gets changed into 360-degree customer engagement and provide post-purchase experiences. This include coming together of transactions, interactions, engagements, recommendations, and actions in order to resolve customer issues. Self-service becomes easier with rich handholding that is automated and, in some cases, assisted.

To conclude, it is an exciting time to be in retail industry with new technologies driving the industry forward in ways never seen before. The way customers interact with retailers is constantly changing as customers increasingly turn to digital strategy at all stages of the buying process. These trends are placing tremendous pressure on retailers to offer new experiences to their customers across all of their channels — from physical stores to web and mobile. All in all, digital transformation is a boon for end customers providing them a better retail experience at every level and each phase of their retail journey.