The changing face of retail: meeting customer needs in 2018
Today’s customer is savvy, digitally connected and more than happy to shop around to get the best product… at the best price, and in the shortest delivery window. As online shopping grows in popularity, and retailers such as Amazon launch in Australia, retailers are under mounting pressure to understand and respond to customers’ needs in more complex detail than ever before.
Here are the top 3 trends that will impact customer expectations in retail in 2018.
- Fast, accurate, low-cost delivery
For many years, Australian retailers have been held back by the high costs of distribution and logistics. However, with the launch of Amazon Australia, this needs to change. Today’s customer wants their product rapidly, regardless of where they live, or when they place an order.
To combat Amazon’s delivery power, traditional retailers need to find new ways to fulfil customer needs – through things like “buy online, return in store” terms, or “click and collect” offers.
To stay competitive, retailers also need to adjust and offer customers the specific type of delivery they want. In other words, they need to re-think order fulfillment and logistics operations to meet the demands of the omni-channel customer. This means centralising inventory control, order processing and fulfillment capabilities in order to execute flexible and cost effective strategies. This of course all relies heavily on having suitable back of house systems and processes.
Without the right technology in place, delays can occur, orders can be missed, and deliveries can end up in the wrong destination. This can result in potentially significant issues for customers, and a less than ideal service experience.
Conversely, efficiencies in your supply chain, warehousing, finance and distribution operations can significantly enhance and evolve the customer experience.
For a customer, the only thing that’s more frustrating than finding an item is out of stock is finding that the retailer has no idea when it will be replenished. Unless you have suitable technology in place, there’s no way for you to quickly provide a customer with the information they need.
With a solution such as Microsoft Dynamics 365, your entire sales team can access crucial information on every element of your supply chain, anywhere, at any time, and from any device. This means you can very quickly determine where stock is located around the clock. You can also determine how long it will take for a product to be delivered to your warehouse, or directly to a customer’s address, and provide this information to customers with confidence.
By using technology to take control of your supply chain, you can also greatly reduce the time you spend shipping, receiving, tracking and compiling order data overall – which means you have more time to focus on your customers’ needs.
Retailers can also explore the option of using existing stores to fulfil online orders, freeing up sales staff from manual processes so they can assist customers and fulfill online orders.
Popular Australian fashion retailer, City Beach, for instance, is implementing a range of in-store innovations to enable this, including deploying handheld scanners to replace labour-intensive stock management and inventory checks.
To minimise the impact on store operations and customer service levels, new concepts such as “hub stores” may also be deployed. Under this strategy, a single store acts as a fulfillment centre for a densely populated region to minimise disruption of activities at other stores in the area.
- Greater customer self-service
Increasingly, customers expect to have far more control over the entire sales process. They want to know where a product comes from, and if they are buying online, exactly when it will arrive. They also expect to get all the information they need about a purchase before handing over their payment details.
With a powerful back of house solution, you can provide your end customers with the product detail they need, as well as the means to continually track the status of their orders. You can also potentially provide customers with current stock inventory details via your website to enhance the overall sales process.
Australian tile retailer, Beaumont Tiles, for instance, is already focused on creating personalised shopping experiences. The business recognised that its customers often research products online – including overall looks and finishes. The Beaumont Tiles website therefore offers a ‘scan-and-play’ feature, which enables customers to choose their tiles, actually ‘see’ what their room would look like and save options to their profile.
Andrew Cromie, Beaumont Tiles’ Chief Financial Officer, says, “customers want to do their research before they buy instore, and our scan-and-play feature on the website allows them to see what would fit best in their home and we can call that information up instore and provide advice and assistance to buy. It’s a seamless experience that focuses on what the customer wants.”
When it comes to providing customers with the information they need online, it’s also important to give your sales assistants they need to fulfil customers’ needs in-store. As we discuss here, your sales staff can be one of the biggest contributors to the success and failure of traditional retail stores. Their availability, knowledge, advice, assistance and professionalism have a strong influence on a consumer’s likelihood to recommend a retailer to friends. Conversely, poor service is a major contributor to customer defection.
Using technology to equip staff with improved access to information and stock visibility across channels helps retailers build customer loyalty.
- More in-depth awareness of customers’ needs
Today’s shopper expects a connected, seamless, omni-channel shopping experience. In exchange for sharing data when they shop online, or use a loyalty card in-store, they expect more personalised, streamlined shopping experiences – as well as offers that are specifically customised to their preferences.
When it comes to responding to this demand, harnessing in-depth customer data is becoming more and more vital. While many retailers are starting to use data about customers and their buying behavior to drive insight and improve customer relationships, the importance of data in retail is set to increase tenfold. This is particularly the case thanks to data-driven innovations such as the Internet of Things (IoT).
From a supply chain perspective, the IoT provides retailers with better visibility of goods, which can enhance customer service and loss prevention. IoT devices can also be used to help retailers understand the relationship between environmental factors and customers, such as store layout – or hot spots, at particular times of the day or season.
With sensors in store, and warehouse systems that automatically order products when inventories reach certain levels, retailers can add value to their supply chains and help meet surge in demand at unexpected times.
Similarly, by using RFID tags, retailers can increase their inventory accounting accuracy, dramatically reduce out of-stocks, and reduce product loss, which can improve margins. Retailers can also make cost-based decision to fulfil customer needs across channels with accurate, real-time inventory data.
The IoT can help make the customer’s shopping experience smoother and easier. The big challenge for retailers is how to manage, analyse and act on the data collected from all these connected devices – up and down the supply chain.
“These insights need to connect to the business strategy and be actioned from the top to the store level, whether it is personalising in store displays or managing inventory in the warehouse. The more retailers can eliminate the hassles associated with shopping, the better the customer experience will be,” says Brett Ashcroft, Sable37’s retail industry expert.
Find out more
Read our retail whitepaper – Thriving in the Amazon era