November 3, 2020

Digital Transformation Is Key To Retail Success 

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Digital transformation continues to disrupt the retail industry as consumers are harnessing the power of their computers and mobile devices to enhance online and in-person shopping experiences. While many consumers still visit traditional brick and mortar stores, many have turned to online shopping to avoid in-person contact through the current pandemic. In fact, a recent survey revealed that one-third of consumers would rather wash dishes than shop in person as they view shopping as more of a chore. 

 

What Consumers Want From the Digital Experience 

Consumers who use e-commerce sites are seeking shopping experiences that adequately replace the in-store experience. A less than satisfactory online shopping encounter will drive them away and seek competitors who do offer a richer, more engaging experience. The Digital Transformation Institute compiled a summary of the qualities consumers seek in online shopping.  

  • Greater Delivery Options 

Consumers expect efficient online delivery of their products, with many who prefer same-day delivery. 

  • Support With Purchases In-Store 

Customers who order online seek retailers who easily accept returns in person. Additionally, those that need setup assistance with electronics or other items ordered online find it is easier to do so in-store.  

  • Ability to Check Product Availability

At 75% of the survey, this expectation ranked the highest among consumers. Many find that the certainty of a product being in stock before they head to a store saves time. 

 

How Leading Retailers Are Stepping Up 

With this in mind, how are today’s popular retailers meeting this e-commerce demand? There are several methods popular retailers are successfully incorporating into their digital transformation efforts to attract more shoppers. 

  • Augmented Reality (AR) and Virtual Reality (VR) 

The digital transformation concepts of AR and VR are generating immersive and engaging experiences for consumers. Companies enable shoppers to try on clothing in simulated fitting rooms. Research firm Gartner projects that the growth of high-speed 5G will drive 100 million people to ship with AR technology.  Additionally, 46% of retailers plan to deploy either AR or VR to  enhance the retail experience.  

Popular home improvement and Do It Yourself (DIY) store Lowe’s, uses an integrated AR system within their app to help customers design their kitchen or bathroom. The app uses a virtual room designer to help them visualize the completed projects. 

  • Online Personalization

Using a 3D augmented reality mirror, make-up company Sephora  offers a completely personalized shopping experience. The company’s app allows shoppers to try on cosmetics in a 3D AR mirror. With over 300 beauty brands and its private label, the company tracks the customer’s choices and sends follow-up emails with personalized recommendations based on past choices.  

Popular U.S. electronics and appliance store, Best Buy has also harnessed the power of online personalization. When a consumer enters a local store, they receive notifications of sales and specials of products they have browsed. When picking up an online order, an “on my way” feature notifies sales associates that the customer will be arriving shortly for their purchase. Artificial intelligence drives personalized emails to ensure customers do not miss out on products they have shown an interest in. 

The Home Depot, a DIY company with over 2,200 stores in the U.S, uses customer and product data to produce personalized emails for their customers. Their system ensures that customers do not miss out on products they have previously shown an interest in. Their online presence offers thousands of customer reviews, hundreds of videos, and over a million products. The company has successfully compiled all of this data digitally for their customers to access.  

  • QR Codes

The Quick Response (QR) code is another tool that retailers use in their digital transformation arsenal. When scanned with a mobile device, this code gives consumers detailed information about the product. QR codes are also being used on mobile phones for rewards systems and check-out.  

The following leading retailers are successfully using QR codes: 

Target-Target Wallet integrates its credit card, RedCard, with a rewards platform using QR.  

Dunkin Donuts-Dunkin’s payment app includes a QR code that customers use to scan for points and payment for food. 

Starbucks-Starbucks uses QR codes for mobile payment and their rewards points. 

  • Digital Price Displays

    Printed price signs on shelves are slowly disappearing as digital price tags are being introduced in retail stores. U.S. grocer, 
    Kroger, uses digital price displays in partnership with Microsoft for a proprietary technology called Enhanced Display for Grocery Environment (EDGE). This technology has saved the company thousands of dollars in labor as price tags no longer have to be manually changed. It has also increased efficiency and customer satisfaction since discrepancies in the shelf label and check-out price are eliminated. 
  • Voice-Based Ordering

    Thanks in part to Google Home and Amazon Alexa, voice-activated systems are another digital transformation technology that has skyrocketed in use. Several popular companies, including Dunkin Donuts, 1-800 Flowers, Dominos Pizza, and Starbucks, enable the devices to use voice to place orders. Customers can easily place orders on the go easily and quickly, even while driving. This form of ordering is particularly popular among millennials. According to a 
    survey by the Global Web Index, an estimated 25 percent of 16-24 year-olds regularly use voice search on their mobile devices.  

 

The Future of Retail Digital Transformation 

A recent survey revealed that 72% of consumers are driven to online grocery shopping because of long lines at checkouts and delays caused by problems with traditional barcode scanning.  Digital transformation seeks to solve these problems with innovative technologies.  

The store of the future is demonstrated in Amazon’s concept of its self-checkout store, Amazon Go. This store’s advanced shopping technology addresses the problems of long lines and barcode scanning at checkout. With a combination of cameras, microphones, and machine learning devices, Amazon Go’s check-out free system senses what products are removed from the store or returned to shelves, charging the customer’s Amazon account accordingly. 

Amazon isn’t the only company developing cashier-less stores. MasterCard has teamed up with a robotics company to create a Dunkin’ Donuts that allows customers to shop for doughnuts and coffee without a cashier. Other companies jumping aboard this technology include Walmart, Sam’s Club, Kroger, and 7-Eleven.  

It’s clear that retailers must update their online and in-store digital technologies to attract and maintain customers. 

Scalefocus enables retailers to accelerate their move to the cloud. We empower them to leverage technology in new ways to support their business continuity, growth, and customer experience through tailored services. 

We also can help accelerate digital transformation to decrease the time-to-market of the retailer’s products. This allows them to focus on the core business while we take full responsibility to deliver solutions.  

At Scalefocus, we can partner with your business to help increase sales globally and harness these trends. Contact us for more information on our complete line of e-commerce solutions.