Retail’s digital future: challenges and opportunities in the post-covid-19 world

In essence, there are three key things retailers need to do to survive and thrive: know in detail what their customers want; deliver relevant products and interactions; and be able to scale and evolve. Yet while that may sound relatively simple, it’s challenging to achieve.

The impacts of the covid-19 pandemic on the retail industry have varied widely. While demand for some products such as clothing and luxury brands has dropped dramatically, elsewhere retailers have been able to pivot to reliable revenue streams. Yet for many, the major challenge has been the stress placed on e-commerce functions and scaling their supply chains.

Setting the standards

The sudden massive acceleration to more online shopping has revealed cracks that already existed, such as how to rapidly scale up and keep customers engaged, together with new challenges, such as how to cater for socially distanced customers. While access to technology is universal and relatively cheap, it’s what retailers choose to do with it that matters. Today’s consumer has more choice than ever before; and when covid-19 made physical shopping impossible, retailers faced the challenge of how to keep customers engaged and connected to their brand.

What’s clear is that the ability now to stay close to customers will decide which retailers survive and which become obsolete. The gold standards have been set by the world’s best-known digital giants. The benchmark is a simple-to-use, consistent, personalized omnichannel experience that keeps individual customers connected while leveraging large volumes of data in order to continuously adapt.

Staying connected when customers aren’t shopping

There are interesting examples of customer engagement during the covid-19 initial crisis that could endure. For example, while its restaurants were closed, a large quick service restaurant player leveraged its digital platform to enable customers to play games online and win prizes while educating them on the safe options for getting their favorite food and drinks (delivery, drive-thru). Now, as restaurants reopen, this same platform and strategy play a key role in getting customers back through the doors.

There are lessons here for any retailer: how to understand your customer, even when they are not shopping with you, and then use those insights to personalize and deliver what they want in a way that is multichannel, scalable and evolving.

Building cases for investment

The journey to this digital future starts with building up and nurturing the digital customer base. By segmenting this customer base (for instance, personas, behaviors or both), a detailed picture will emerge of who your customers are, what they want, need, do and what they are expecting from you as a brand.

These insights give retailers options; and by working through different business case scenarios, it will become clear where to make investments. The next step is ensuring that insights are leveraged, aligning the digital and physical in-store experience to create a coherent customer journey across all touchpoints – mobile apps, email, social media, physical stores and so on – and a consistent experience and tone of voice for each customer.

Understanding this has become more important than ever. Covid-19 has changed the short- and long-term needs and demands of customers – leading to a resegmentation of the market. The sooner a retailer understands the insights from this resegmentation, the better.

Mature digital and data strategy

True customer insight is key – and today that is all about data: the more you know, the more intelligence you have to devise a strategy for closing the (data) gaps. Having a mature digital and data strategy helps retailers stay relevant and ahead of the competition.

The digital strategy determines the role of each digital touchpoint in the customer journey. For example, the website might be about informing customers – opening times, social distancing and hygiene measures, customer services details, and so on; the mobile app, on the other hand, might play a very different role – personalized content, offers and teasers that encourage customers into the store or shop online. E-mail newsletters, SMS, social media (such as WhatsApp for Business), POS, self-service kiosks can all play different roles within the customer journey.

In terms of a data strategy, this is not just about the technical solution for storing, managing and transforming data; instead, it’s about:

  • What data do we want to collect when a customer interacts with each digital touchpoint?
  • What external data can we use to enrich our own data?
  • How do we define a ‘golden customer record’ that is universal across touchpoints?
  • Which KPIs do we define for measuring the success of the data strategy?
  • What AI and analytics will enrich the data sets and generate new insights?

Only when these questions are answered does it make sense to think about what the technical solution will look like, what analytics capabilities are needed, and how to orchestrate the right digital platform and customer interactions.

Revolutionizing shopping and supply chains

The covid-19 crisis has accelerated what was already happening as retailers harness digital technologies to shape the next generation of shopping experiences. The function of stores and showrooms, with digital increasingly critical to customer experience, will revolutionize this sector. Soon shoppers will be able to choose all they need using augmented reality with an assistant in store, ready for delivery direct to their door just a few hours later.

The journey to this digital future starts with building up and nurturing the digital customer base. By segmenting this customer base, a detailed picture will emerge of who your customers are, what they want, need, do and what they are expecting from you as a brand.

For retailers who can only utilize a fraction of their large store spaces because of social distancing, maximizing revenue is a major business and creative challenge. It means rethinking the process of innovation and also how funds and budgets are assigned to departments. The time is ripe to be forward-thinking and experimental – with customers’ needs first and foremost – to stay relevant, flexible and fit for future.


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About Bram Steenhoek
Head of Global Retail Consulting
Bram is the head of global retail consulting at Atos. He leads an international team of business consultants that combine business understanding with problem solving skills and technical know-how to help clients create value. He sets vision and brings thought leadership combined with a practical and entrepreneurial mindset. Bram holds a masters in Marketing and has gained experience in the software and creative agency industry where he helped some of the worlds largest brands create value from digital technologies & data through strong customer focused value propositions.

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