Top 3 Trends from Retail Business Technology Expo 2016 in London
The Retail Business Technology Expo (RBTE) in London last week was filled with visitors, speakers and businesses showcasing their latest retail strategies and products.
Representatives came from the full spectrum of the retail eco-system: brands, retailers, consumers, technology, suppliers – all of whom have been facing technological innovations and disruptions on several fronts - from Consumer-facing Digital Marketing and Sales Strategies, to Omni-channel challenges in Operations and Supply Chain.
Commercial relationships amongst the participants of the retail eco-system have become more interlinked and their identities blurred as technology dis-intermediates and online communication channels empower customers and other stakeholders to become your best or most feared brand ambassadors. These feed into businesses’ Customer Value Proposition on one end and Enterprise Value to Investors and Shareholders on the other, which change with these dynamic market forces, and are very much of concern to stakeholders in the retail eco-system as discussed at RBTE.
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In the context of such dynamism in the retail market, it was very interesting attending the insightful speaker sessions at RBTE. A wide spectrum of speakers from the eco-system presented in the four “theatres” – ranging from Board Members to Managers in Operations, Sales, Marketing and Supply Chain, coming from both traditional retail and e-commerce, such as John Lewis, Debenhams, Tesco, Sainsbury, Boots, Marks and Spencers, Ocado, All Saints, Google, eBay, Paypal, Visa, Barclays, Worldpay, WPP, Forrester Research, OC&C consulting etc.
Three trends stood out specifically:
1. Omni-channel was still the most discussed topic after several years being the leading theme at Retail Expos globally.
This year, retailers highlighted the operational challenges of making incremental innovations to operations, technology, organization, sales & marketing, and the impact on profitability to be “omni-channel”. Success stories included “click and collect”– thereby driving customers to stores (e.g. Boots), and increased personalization with loyalty programs, thereby engaging customers with the brand story (e.g. Ikea). These incremental innovations to compliment retailers’ traditional way of doing Sales and Marketing are beginning to achieve the objectives of efficiency gains or sustaining market share by catching up with customer experience.
On the other hand, large untapped opportunities remain for retailers and brands to take on a more holistic consumer-centric approach from Marketing to Sales, Payment and Delivery across Mobile, PC and High Street channels using latest technology in Big Data and Mobile Connectivity to offer customized omni-channel shopping experience. (The Future of Shopping in Harvard Business Review 2011)
2. Customers have been patient with the discrepancies in omni-channel shopping experience - so far.
As shoppers ourselves, most of us have endured experiences that fell short of brand promises – for example where we had to adapt to a retailer’s internal processes, such as customer service or delivery options. As e-commerce players continue to raise the bar with improved shopping convenience and lower costs to consumers, brands in the e-commerce space will continue to win over consumers' share of mind and share of wallet, which has been outpacing traditional retail growth globally. Customers will soon be spending more time and money online, especially with mobile becoming a key purchasing tool for consumers. (PWC Total Retail 2016)
Retailers that get it right in being relentlessly consumer-centric and addressing the customer shopping journey from Effectiveness to Ease and Emotions in their strategy and processes unsurprisingly outperform the market (The 3 E's of Customer Experience by Forrester Research), such as Amazon and John Lewis. In fact, Customer Service has recently emerged as “THE most critical factor” in influencing where customers shop (OC&C consultants' Retail Proposition Index 2015). As retailers and brands have now mostly caught up with retail price parity across channels and improved shopping convenience with initiatives such as “Click and Collect”, Customer Service - such as shopping advice, easy of payment and after-sales support - is now the key battle ground.
3. Big Data is the “new oil” - a new generation of "refineries" needed in the retail eco-system.
Data is a huge resource to brands and retailers, giving insights on consumer shopping behaviour like never before. However, just as oil required refineries to be useful, so does data (WPP). While Digital Marketing and E-commerce are providing an immense amount of consumer behaviour data to brands and retailers – from where they come from to where they are going - the situation is more of an information overload to many brands and retailers.
In order to make sense of “Big Data”, brands and retailers need a new generation of data analysts in its Marketing, Sales and Operations teams to “refine” the “oil” into useful and relevant information in order to take actions. This in itself poses new challenges to organizational design, talent management and industry regulations – gaps between traditional retailers and e-commerce widen as retailers, brands and regulators take time to figure out the optimal organizational structure, talent development plans and regulations while the market evolves technologically. This leaves room for disruptive and innovative businesses to take advantage of the situation and shift market share in their favour.
In conclusion, the world of retail and business technology is changing rapidly and the eco-system of traditional retail is being disrupted by innovative businesses from all corners of the globe. How to respond to the changing market and how fast to change in the face of uncertainties and technological innovations remain the most challenging questions to brands and retailers and likely a matter of survival or success.
Written and Published by Joyce KWONG in March 2016.
Joyce Kwong is a Professional Business Consultant at Disruptive Business Consulting specialising in:
1. Strategy and Business Development,
2. Digital Transformation,
3. Performance & Talent Management
4. International Expansion
She runs a 30minutes Business Clinic for Entrepreneurs and SMEs as part of her Coaching and Mentorship program.
Joyce graduated from the University of Oxford and has a MBA from INSEAD.
She is a Member of the Institute of Directors (MIoD) and Royal Institute of International Affairs (Chatham House) in the UK, & a Freeman at the Worshipful Company of Marketors in the City of London.