Digital Transformation is accelerating at unpredictable speeds across the retail industry worldwide and has not only changed how we interact with brands but pushed even more retail customers online. As a result, retailers must make deep changes to their operations, supply chains, inventory management, and customer relationship patterns. Companies must analyse data to accurately project demand, react to customer demands, and ship products promptly and efficiently to satisfy customers.
Before we dive into the key drivers of digital transformation in retail, here is a brief overview of the meaning of digital transformation and why it is essential for organisations to adopt this strategy to succeed now than ever before.
What is Digital Transformation?
At Data Clarity, we define digital transformation as: “The business-wide implementation and adoption of technologies and data-driven solutions, designed to improve business processes, deliver better value to customers, and improve organisational results.”
Why does Digital Transformation Matter?
Digital Transformation enables businesses to utilise data and technology to better serve their customers and internal stakeholders. Importantly, technology should support and optimise existing processes, without disrupting your organisation.
For more information, read our starter guide to view our most frequently asked questions about Digital Transformation.
For the foreseeable future, changes in consumer behaviour will have a greater impact on value in retail than any other single factor.
“Every customer interaction is a unique opportunity to harness long-term value by providing exceptional service. Retailers must leverage technology that augments the customer’s preferred way to shop.” – Gartner
Individuals have become more accustomed to the efficiencies and conveniences that technology brings. Consumers have become hooked on the real-time, personalised world of the digital landscape, and they expect retailers to follow suit. To keep up with such changes, brands can leverage technology to evolve and transform to meet demand.
Drivers of Digital Transformation in the Retail Industry
For a while, retailers have been experimenting with ways to respond to consumer demand, bridge digital and physical shopping experiences and to implement more technology and data-centric solutions to stay ahead of the game and recover faster from the pandemic.
The key drivers of digital transformation in retail are:
Better User Experiences
Digital transformation enables more companies to eliminate more points of friction in the customer journey.
More than ever, the consumer has control over the way brands deliver experiences. Mobile devices, apps, AI, augmented and virtual reality settings and much more allow customers to get what they want almost exactly at the moment they need it.
These new digital and data-driven strategies have caused a shift in consumer expectations. Today’s tech-savvy shoppers are constantly connected, app-native and aware of what they can do with technology.
What’s more, these digital technologies increase greater chances of customer success. Translating into better profit margins, more revenue, and better prospects for the business itself.
Faster, Better Decisions
Businesses today can access greater volumes of data than ever. With the right analytics tools, companies can transform their data into valuable, real time business insights that can be used to make faster, more informed decisions about their strategies.
More Agility and Innovation
Digital transformation keeps businesses to stay alert. The evolution of digital innovation leaves companies with no time to rest. Leading businesses must stay adaptive and keep improving their business innovation to stay ahead of the competition.
Learn here to understand more on how a digital transformation strategy can help you provide a greater customer experience.
The Evolving Expectations of the Omnichannel Shopper
Making practical use of customer data enables brands to instantly connect with customers using hyper personalised messages on the right channel, at the right time. Omnichannel approaches and technology enables organisations to optimise channels to the full potential and puts the customer at the centre of the strategy to drive growth, as well as understanding their customers’ journey, behaviour and buying patterns to provide them with a truly personalised experience.
Read this article to discover how retailers like Paul Smith utilise omnichannel to increase sales by an average of 40% with this approach to customer experience.
Bridge the Gap Between Offline and Online
Successful online retailers utilise consumer data to provide tailored online shopping experiences for individuals, accurately predicting needs and wants right in front of your eyes to suggested purchases and enhancements that collected data says will likely result in a purchase.
This same approach can be taken for in store experiences, utilising collected data from both online and in-store. Retailers want to better understand what drives customers to visit their stores and make purchases, as well as the revenue their marketing drives to stores.
Retailers are constantly looking for the competitive edge and better ways to reach customers, more efficient customer journeys and opportunities to proactively meet customer needs. Creating an immersive, unique, and exciting experience for shoppers both online and instore is one such way to guarantee conversation and footfall.
An Appetite for Shoppers to Have a Personalised Experience
Customers expect brands to cater to their individual needs and preferences. To uncover how essential personalisation is, 72% of consumers say they now only engage with marketing messages that are personalised and tailored to their interests.
Every interaction with your brand builds the profile of your customer to allow you to better serve their needs and build brand loyalty. These interactions should be contextualised, personalised, and immediately relevant to give customers a better experience.
Data Clarity has developed ClarityOmnivue. This delivers true, accurate data that is utilised to create individually customised targeted marketing campaigns that are personalised and relevant to the customer.
Digital transformation can cover a wide variety of technology-based changes. A business that adapts to the present may be well-prepared for the present. Digital transformations are always long-term organisational transformations and part of a wider cultural shift within the organisation.
If you need more information or you would like to discuss some of your current challenges, our data experts are happy to help. Contact us today for more information.