Cisco will be featured in two Big Idea sessions at this year’s NRF conference starting tomorrow, and I’m happy to introduce guest blogger Lisa Fretwell, who will be leading one of these two seminars. Lisa is the Managing Director of Retail at Cisco Consulting Services, specializing in the Internet of Everything and analytics, and how these new capabilities can transform and differentiate retail and consumer product businesses:
In today’s digital era, stores are clearly challenged in terms of sales and profitable growth. Every retailer is faced with needing to change and innovate their store to deliver results.
Overall, the majority of stores across all categories are demonstrating flat or declining like for like, exacerbated by price deflation. Cisco’s recently concluded annual survey on shopper behavior of 10,000 shoppers highlights the ongoing shift away from the store to online. Twenty percent of consumers now make more than 50% of their purchases online, and this number is expected to continue to grow.
However, when you dig down into the data, you may be surprised by some of the changes. As just one example, we asked shoppers which categories they had significantly moved from store to online. We learned that 41% of the consumers surveyed have somewhat or significantly increased their online purchases of apparel in the last two years – clothing, shoes, and accessories. Traditionally, these products are the life blood of why shoppers go to a store – to touch, feel, try on.
So is it all doom and gloom for shops? No, not if you’re up for innovation and change. There are still significant reasons for shoppers to visit stores. Our research highlights some key insights that retailers must leverage to drive healthy results and make the store experience hyper-relevant.
Our experience from retail engagements suggests the answer lies in two areas: being able to deliver dynamic experiences, and to improve ways of working. From instant response to customer needs to improved process digitization, we are seeing that retailers are increasingly relying on a combination of sensors, analytics, automation, cloud, and edge computing.
If we apply this model to a $20 billion turnover retailer with 900 stores, Cisco estimates that there is $312 million of incremental benefit to be had: $170 million from digitizing ways of working: staffing optimization, store routine digitization, and colleague collaboration; plus $142 million from improved customer conversion through insight, digital offers and loyalty, service, and cross-channel selling. We believe this approach offers the next much-needed step change in store economics.
To learn more, please join us at NRF on Sunday for Cisco’s Big Idea sessions:
- The first, at 10:15 am in Room 4 of the Expo Hall, covers more on our annual survey results. It is led by Cisco Vice President Joe Bradley (replacing Anabelle Pinto due to a family emergency).
- Then, at 2:00 pm in Room 4, Cisco’s Shaun Kirby and I will discuss how retailers are taking advantage of the “Internet of Everything: New Horizons in Retail.”
We look forward to seeing you there!