Today’s retailers face a hard truth: their customers have embraced digital technologies faster than they have.
But I believe that retailers have an opportunity to elevate the shopping experience in exciting new ways. By integrating the digital and the physical — in effect, merging clicks with bricks — retailers can capture new revenue, along with loyal, satisfied customers.
First, retailers need to understand a changed landscape. In only the past five years, mobility, analytics, e-commerce, and other technologies have had a profound effect on the entire shopping experience, putting the customer in charge. Traditional retailers must respond with highly relevant experiences that drive greater efficiency, savings, and engagement.
Recently, I shared some thoughts on this topic with Cisco, both for a new global study on retail trends and also in a podcast titled The Last Checkout Line. The U.S. and U.K. findings of Cisco’s study were released early this year and showed some surprising results. As Cisco’s paper emphasized, customers demand a hyper-relevant shopping experience, in which past shopping histories, current contexts, and future plans drive real-time interactions with the retailer, in-store or out.
Some retailers are already excelling in these areas. Sephora, the French cosmetics franchise, is a good example of a retailer that is offering digital and mobile experiences in-store, enabling customers to interact and discover products in new ways while also bridging a seamless connection with the online experience. Other retailers have leveraged analytics to ensure stock availability for individual customers, integrating with other store locations to ship products to the customer’s home or a more convenient store location.
I believe that all retailers will need to assess their current capabilities. The mobile experience in the store is essential, both to interact with customers on a deeper level and to empower in-store associates with real-time contextual information. This requires enabling Wi-Fi and expanding bandwidth to accommodate new digital experiences.
Analytics, of course, is critical to understanding customers, in-store and out. Retailers will need accurate information at all stages of the shopping journey. That includes accurate data on inventory and customer browsing habits; there is no faster way to disappoint a customer than not having the item he or she expects, or to make the customer wait.
But retailers will also need to be sensitive to how much information customers are willing to share. There’s a fine line between an appropriate “opt-in” incentive and one that is perceived to be intrusive. If retailers get it right, customers will see the clear benefits and value in sharing their data.
As Cisco’s retail paper stressed, technology has accelerated changes in customer behavior, and traditional assumptions around age demographics are outmoded. Gen Y can enjoy the store experience, for example, while older customers may be highly connected and mobile. Retailers will need flexible, future-proof infrastructures that enable them to respond to ever-shifting customer demands.
I see the winners in retail succeeding on three key fronts:
- They will provide breakout innovations that set market expectations for new kinds of customer interactions, new ways of sorting and tracking products, and new ways of fulfilling customer needs. These will be highly relevant and situationally aware; that is, aligned with customers’ current contexts.
- They will have flexible systems and architectures in place to support these new kinds of interactions, and adapt to changes in customer behavior.
- And they will ensure a consistent, seamless experience, whether the customer is engaging via email, call center, online, a mobile device, or with an in-store customer associate.
In the end, winning retailers will shift their focus from short-term profits to a customer-centric strategy. After all, the more relevant, streamlined, and seamless the customer experience, the more likely it is that those customers will return — again and again.
Tags: analytics, Cisco, Cisco Consulting Services, connected retail, data, digital, hyper-relevance, Internet of Everything, IoE, IoT, Leslie Hand, retail, shopping
I have just returned from a very interesting and jammed-packed week at Mobile World Congress 2015 in Barcelona. A record 93,000 plus people are estimated to have attended this year’s premier technology festival. Much has changed in the industry over the last year since I reported my observations of MWC 2014. However, what is most remarkable is how the boundaries of mobility continue to expand and morph – everything now seems to be mobile? As such, the show offers a fascinating glimpse into the future of technology and the major social and business shifts that we can expect in the next few years.
The following are my personal observations and extrapolations from the show Read More »
Tags: 5G, business models, Cisco, IoT, mobile, mobile data, mobile devices, mobile networks, mobile operators, mobile world congress, mobility, monetization, MWC 2015, NFV, service providers, small cells, wi-fi
The widespread adoption of the Internet of Things, connecting sensors, equipment, machines and assembly lines to the network is driving a manufacturing industry transformation. In fact, nearly 30 percent of all manufacturing-related firms are in some stage of piloting, implementing, or expanding IoT deployments. By 2017, an expected 80 percent will have implemented an IoT solution.
Many manufacturers are in the process of figuring out how to deploy a Connected Factory, or perhaps pilot a smaller scale wireless network pilot project in their manufacturing facility. In fact, ARC analyst Greg Gorbach who covers ‘Industrial Internet of Things’ recently wrote a blog, ‘Let’s just try it’, focusing on a panel presentation that I was part of at their recent conference. This blog focuses on the Stanley Black and Decker success story at their Reynosa factory in Mexico and how a ‘let’s just try it’ approach yielded these results: “OEE increased 24%, defects decreased 16%, labor utilization is up from 80 to 92%, and line throughput is up 10%. In addition they now have empowered employees, improved labor ergonomics, reduced labor training, and better visibility for line supervisors.”
If you are in the midst of this decision process on ‘where to start’, I’d like to encourage you to access our webcast on demand titled “IoT: Oppportunities and Momentum in Manufacturing”, A part of the IoT in Action series, this webcast covers key learnings from industry thought leaders from Forrester Research, AeroScout Industrial, and Cisco. These experts, Michelle Pelino from Forrester, Priya Vijayakumar from AeroScout and Chet Namboodri from Cisco discuss what it takes to make the transition to IoT and how companies are reaping the benefits of efficiency, cost savings, better data analysis, and faster time to market. Check out this webcast and let me know what you think.
Thanks for reading!
Tags: Cisco Connected Factory, IoT, SBD, stan, Stanley Black & Decker
Retailers once had a pretty clear idea of who shopped where and how they did it. After all, there were not that many options available for shoppers. Consumers would see an ad or peruse a catalog, and then visit the physical store with the hope that their preferred item was in stock.
These days, retailers understand there is an entirely new kind of shopper. Indeed, since the advent of e-commerce, retail complexity has increased exponentially, and today’s digital consumer navigates a wide range of channels and potential shopping journeys.
As a recent Cisco survey of retail trends discovered, e-commerce has added about 40 possible shopping options for a typical shopper. With the rise of the Internet of Everything (IoE) — the explosion in networked connections of people process, data, and things — potential shopping journeys will expand to 800 and beyond. Some of the new options coming into play could include mobile devices equipped for live Web engagements, checkout optimization, mobile payments, wearables, augmented reality, and drone delivery.
The variety of journeys available to shoppers is growing exponentially.
Source: Cisco Consulting Services, 2015
This sweeping digital transformation has dramatically altered the shopping behaviors of consumers, who now demand experiences that are contextual and hyper-relevant (enabling consumers to receive what they want, when and how they want it), whether in-store or out. As a result, retailers are reinventing their business models and rethinking much of what they once knew, including traditional customer segmentation.
Video: IoE in Retail: Hyper-Relevance through Consumer Context
Increasingly, we are entering a period that has been referred to as “post-demographic consumerism” in which consumption patterns are no longer defined by traditional demographic segments such as age, gender, location, income, family status, and the like. This presents a significant challenge to retailers already grappling with growing complexity in their operations.
For example, Cisco’s research reveals that Gen Y is far from monolithic. On one hand, Gen Y continues to accelerate the shift to online channels (faster than any other group): although 34 percent make more than half of all purchases online as they seek convenience and greater access to information, 54 percent would shop only in stores for the next month if they had to make a choice. Moreover, just as the physical store remains important to Gen Y, many seniors are shopping online or with mobile devices.
In short, consumer segments are increasingly fragmented and ephemeral. The sheer number of potential shopping journeys is growing exponentially, and the change is occurring faster than ever before. For an individual shopper, however, the journeys are also dynamic. Consumers are constantly shifting to other journeys as new innovations emerge —
and faster than retailers can respond. Compounding this, the velocity of innovation is increasing as IoE dissolves traditional barriers (for example, through the low cost of app creation, the Kickstarter-style funding model, and so forth).
Since every retailer is unique, and there is enormous variation across categories, each retailer must define its own target segments, and then be prepared for the rapid evolution of new “microsegments.” Cisco is working with retailers to define target segments and prepare for the evolution of new ones.
To enable the customer outcomes that will determine the winners of the IoE era, most retailers understand that they need to know their customers as never before and, critically, possess the requisite business agility to adapt. Fortunately, IoE and consumer analytics technology provide the platform to truly understand, engage and respond to their customer.
Analytics is a key competitive frontier in the IoE era, enabling retailers to provide consumer experiences, offers, and interactions that are contextual, relevant, and timely. Moreover, analytics empowers the retailer to respond dynamically to constantly changing customer behavior.
To succeed in this area, retailers need a technology strategy that captures data at the “edge” of the network — from mobile devices, sensors, video cameras, and the like — and analyzes it locally, in real time, to respond to fast-moving opportunities. By leveraging analytics and other key elements of IoE such as video and mobility, retailers can drive greater efficiency in each customer journey, offer real-time savings, and create a more relevant customer engagement.
As shopper segmentation blurs, analytics is critical to understanding the new digital customer. Old or young, rich or poor, all customers have value and want to interact with retailers in new, hyper-relevant ways. IoE-driven solutions are the way to do it.
Tags: Anabelle Pinto, analytics, CCS, Cisco, Cisco Consulting Services, connected retail, data, digital, hyper-relevance, innovation, Internet of Everything, internet of things, IoE, IoT, National Retail Federation, NRF, retail, shopping
Many of you may have missed the recent presence of Cisco at DistribuTECH in San Diego last month, so that blog is summarized here and a link to the live blog is given at the end of this summary:
At DistribuTECH, Cisco had the pleasure of engaging with attendees, demonstrating how utilities the world over have worked with Cisco and our partners to reduce costs and deliver more services on a single, intelligent and secure platform. The IT model we shared is one that brings innovation to the Operational Technology (OT) environment, integrating information, data, people and processes – the building blocks for the Internet of Everything.
In the included video Bit Stew went on to talk about how they’re taking their software, embedding it in Cisco routers, putting it inside substations, allowing that intelligence and that automation to happen in real time, right at the edge of the network, yet tie back into cloud based systems. This technology is brought to life at major utilities such as BC Hydro, a Canadian electric utility in the province of British Columbia, which first introduced smart meters in 2011. Find out more by reading the whole blog below.
Read the blog here: Fog Computing Becomes Clearer with Cisco IOx Solution
Read More »
Tags: Bit Stew, DistribuTECH, edge computing, Fog computing, IoE, IoT, IOx, utilities