In recent years, the balance of power in retail shopping has shifted rapidly away from sellers and toward well-informed, mobile and socially connected consumers. The once sharp line delineating in-store retail and e-commerce blurs as on-the-go, tech-savvy shoppers research, browse, try on and transact wherever and whenever they please.
Today’s new market reality is forcing retailers to become more sophisticated and imaginative in how they attract and engage customers, predict demand, manage and move inventory and integrate their physical, virtual and mobile selling channels. Many retailers have decided that the best approach to remaining competitive in the digital age is to adopt advanced IT systems and related technologies.
Retailers are expected to spend more than $190 billion on IT in 2015, according to a report from global research company IHL Group. It’s easy to see why retail IT spending is skyrocketing: Technologies ranging from sophisticated point-of-sale platforms to omnichannel marketing and Big Data analytics are improving efficiency and profitability, while opening the door to new customers in both domestic and international markets and helping retailers build stronger and deeper bonds with their existing customers.
Point of sale (POS): Modern POS systems are useful for processing exchanges and generating sales reports, as well as collecting valuable customer information. When inventory management is integrated into a POS system, both online and in-store kiosk shoppers can quickly learn whether the product they are hoping to purchase is actually in stock and available for immediate delivery.
Many retailers have also deployed mobile POS systems to add even greater functionality. With users able to help shoppers anywhere in the store, mobile POS allows for customer-friendly capabilities such as line-busting, while helping retailers maximize efficiency and profits with floor-plan optimization and up-selling.
Omnichannel and UCC: Omnichannel marketing and unified communications and collaboration systems, incorporating a complex mix of technologies, retailer tactics and customer preferences, have become an integral part of the retailer-customer relationship. Taking advantage of online and mobile shopping platforms, social media services, product comment websites, digital signage, instant messaging and a variety of other channels, retailers can now reach out to customers in an almost endless number of ways both online and in-store.
Cutting-edge mobile payment technologies are a particularly important part of omnichannel marketing. By 2018, according to market research firm IDC, 60 percent of omnichannel retailers will have launched customer mobile payment initiatives.
Big Data analytics: Customers are prized because they buy things. Yet customers also generate another important, but often overlooked, benefit: information. The massive amounts of data that customers produce as they search for, learn about, discuss, review and pay for products can provide retailers with valuable insights — as long as the retailer has the right tools and approaches to make the most of this valuable asset.
Customer-supplied data gives retailers numerous ways of understanding shoppers’ habits and preferences via multiple digital touch points — from mobile purchases to social media interactions — that previous generations of retailers could only dream about. Yet massive amounts of unstructured customer-supplied information — Big Data — pouring into a retailer’s data center becomes useful only when it is organized into information and then transformed into knowledge. A new generation of Big Data analytical tools helps users make sense of the unstructured data gleaned from social media feeds, blogs, videos and numerous other sources to expand customer intelligence.
Mobility and apps: Retail apps play an important role in a mobile-optimized retail world, allowing customers to search for and purchase products while inside a store or just about anywhere. Mobile apps are also useful customer retention tools. Coupons and loyalty programs keep regular customers informed, aware and happy. Meanwhile, mobile payment technologies, such as Apple Pay and Google Wallet, give consumers a fast and convenient way of purchasing products directly from their smartphones or tablets.
Beacons are one of the most important new mobile technologies helping retailers win back sales to their stores. These low-cost devices deliver welcome messages, shopping hints, coupons and other types of information to customers via smartphone apps indoors over a Bluetooth connection.
Inventory management: Retailers are increasingly investing in software and infrastructure to better align and automate the management and distribution of goods. Tracking product demand via inventory management systems, based on data fed in from networked POS systems, mobile payment technologies and other sources, offers a more precise method for ordering, storing and restocking merchandise.
Customer relationship management: The customer intelligence derived from CRM analytics software gives retailers a powerful weapon in their never-ending quest to increase sales. Using customer data to influence and change behavior, with the goal of maximizing customer value, is essential to long-term retail success.
Digital signage: Digital signage allows retailers to reach customers with carefully tailored, dynamic messaging. Compared with boring, static signs that need to be reprinted regularly, digital signs save time, energy and other resources while delivering exciting, high-impact marketing messages.
For more information on the front-end tools that help boost sales and efficiency and improve customer retention, read the white paper “Driving Retail Success with Technology Innovation.”