Back in 2005, I was in a consulting job for a customer based in Smithfield, Virginia. I started traveling via Amtrak that winter to avoid the flight delays due to the frequent snowstorms. Knowing my schedule, my regular cabbie always waited at the station to ferry me around. I was his one-stop shop for all information about New York. On his request, I once bought some ‘I Love NY’ T-shirts from New York which he wanted to sell at the local market.
In 2017, whatever he needs from New York or may be from China or India is getting delivered at his doorstep via Amazon, Etsy, and so on. The world has changed a lot in the past 12 years and the mode of shopping is changing for many. The online sales community is increasing every second. Big retail stores are shutting down, be it Circuit City or the very recent Sports Direct or Macy’s closing many stores. Amazon, eBay, or Zappos are taking their place. Most of my friends as well as myself now buy almost everything online. Be it baby diapers, grocery, furniture, and even houses and cars. However, my parents and my current boss, Rajesh, always argue with me on buying everything online. I was getting tired of explaining it to them that I’d rather use the time saved for my family and friends. Well, the arguments will continue.
What happened in the retail technology world from 2005 to 2017? A couple of big changes: most retail companies’ back-office operations moved to strong ERP packages like SAP at the end of the ’90s which became very stable with order to cash, procure to pay, finance and controlling, RFID, point-to-point sales, well-tracked logistics and shipping, availability to promise, SRM, and CRM. In doing so, by the beginning of 2000, back-end operations were completely equipped to handle large-scale customers and orders. And then a phenomenon started which I call the ‘touchscreen magic.’ At the user end, the whole concept of graphical user interface, the look and feel factor of websites were changed and became more user-friendly with faster processing of data, more prompt response time than ever. That was not all; the iPhone and Android were unveiled in 2007, and now one doesn’t need to log in to the laptop or computer anymore — just tap on the product you want delivered to your doorstep from your mobile device. There was no looking back from that point, and Amazon’s share price confirms my analysis.
Irrespective of technology, data is becoming a key driving force for any segment. The marketing gurus are now rewriting the definition of product marketing. Let’s play a quick game. Open Google search on your mobile and type ‘winter cap.’ What will you get? Multiple options coming up with different price range. This is not it. If you have a social media account which you browse regularly through the same phone, you will start seeing advertisements of winter caps on your page. Is it not interesting? Someone secretly watching you from somewhere and influencing your decision-making. Those days of yellow pages and TV commercials are over, it’s now the era of working on your data and throwing out customized advertisement exclusively for you. Move over DBAs, it’s the data scientists who are in demand. These data scientists across the world are slicing and dicing the data to understand the customer’s choice so that companies can align their product accordingly.
From a consumer prospective, there are two sides if it. You have multiple options to choose from the product range spread across different companies and price range. This makes all the sellers more competitive. But on the other side, too many choices confuse the consumer who then invests more time on decision-making. So, at the end of the day, you spend more time online than you would spend in a store.
Every retail company is cashing in on online sales — even Walmart had to buy Jet.com. The whole world is investing heavily on mobile apps. Be it for the users or the back end, customers are demanding more intuitive solutions. How far can we go from here, what’s next in the retail technology front, what will be the next game changer post the current mobile era? The combined impact of ERP revolution, web revolution, and the mobile era has shaped today’s market. It needs to be a combination of many factors, such as cloud, Big Data, AI, and more, that will shape the future.
Food for thought: While writing this blog, my 75-year-old uncle visited me from Texas and asked me for the USPS drop box as he wanted to drop some checks. Google gave me an option that was two miles away. Yet, uncle went out and found one within half a mile from my home. It was then that I tried looking for apps that would let me search for USPS drop boxes. There were none. We have an app for Tesla charging stations and I know in my locality where those stations are, though I don’t own a Tesla yet. Demand defines the trend, everything else gets aligned.