The retail industry plays a critical role in the prosperity of the Irish economy, and the innovations happening in this sector have been increasing at an exponential rate. The focus of this article is to dissect the influence of e-commerce on the retail industry and how companies can stay competitive in this rule-breaking game. Fundamentally, e-commerce influences how customers interact with brands and how retailers govern their omnichannel presence. New technologies are endlessly being developed to satisfy the ever-expanding needs and expectations of the consumer. As the channels broaden, it is up to the retailer to focus on how they can stay relevant and vying. These businesses need to vigorously leap onto the technology bandwagon and grasp on tight, or they may just fall being their competitors.
Only 20 years ago, mobile phones were solely used for placing phone calls. Today, in the matter of 20 years, they are literally our personal assistants for everyday life- we are completely reliant on these incredible mini computers. Retailers- at least the innovative ones- are capitalizing on this opportunity. They have developed mobile-friendly websites and apps that allow their customers to shop and interact with them on the go. Everyone is on the go nowadays, so this market is massive. It has been reported that 58.7% of purchases in the UK are made via mobile devices, according to veineractive.com(1). Furthermore, Ireland is home to the most active online retail market. On average, the Irish spend €116 per month(2). Consumers are tirelessly searching for easier ways to complete tasks, even shopping. Therefore, retailers need to cater to these cravings in order to remain competitive.
IN-STORE MOBILE EXPERIENCE
Although customers still shop in-store, there is technology involved in that as well. Many customers will walk into a store and look at the price for the item they desire. They will then unlock their personal assistant and check prices at other stores via their websites or apps on LTE speed data. If your price doesn’t compare, they aren’t buying. That being said, retailers can capitalize on smart beacons, which monitor via Bluetooth which customers who have downloaded their app onto their mobile phone are in close proximity. This technology will then send a coupon or a reminder about a sale to the phone, driving potential customers not even in the store yet into buyers. Actually, 57% of consumers said they would be more likely to shop at a store if they were notified about discounts and deals while shopping at that store, which can now be accomplished with smart beacons(3).
The mobile shopping trend has been going on for a few years now. In response, Amazon decided to penetrate a new dimension of the consumer- their houses. Amazon’s Echo, endearingly personified as Alexis, has been on the market for a while now, and the in-home device is still gaining traction. Alexis is voice activated, interactive (I’ve had quite a few good conversations with her), and functional. In addition to playing songs from your phone’s library with just, “Alexis, play Sweet Caroline”, and adding items to your mobile grocery list, she can also shop on Amazon for you. This pioneering company has found a way to let you shop their quite spacious inventory while sitting on your couch at home watching The Bachelor. Alexis is not without a rivalry however, Google’s Google Home is giving her quite a run for her money. Retailers need to find out how to either work with Amazon or Google in this technology, or develop a way to compete with it. The battle for consumer’s attention is only going to propagate from here.
Utilising Big Data for retail
With all this technology comes a tsunami of data, flooding consumer data systems across the board. The data is equivalent to quicksand. You will only sink in it if you struggle. Stay still and calm and embrace the big data trend. Big data is a massive amount of compiled information, analysed computationally to discover patterns and trends relating to human behaviour and interactions. These initiatives are used to improve merchandising, e-commerce, marketing and promotions, customer behaviour when purchasing, and more.
Big data is essential in retail nowadays to see what will be popular in the future by predicting current trends. It gives retailers real-time intelligence about the hottest trends and competitive prices, which will optimise their customers experience. Recommendation engines are also a popular use of big data in retail. Amazon benefits from 35% to 60% revenue uplift on recommendations, according to datanami.com(4). Other big data uses include price, inventory, and workforce optimisation. There are data analytics tools for pretty much anything you want to predict.
Virtual and Augmented reality ARE a reality
Virtual and augmented reality are the next upcoming prominent phenomenons for retail. They are emerging technologies which offer retailers the opportunity to transform the way people shop, and both have the ability to change our perception of the world. According to retailtouchpoints.com, augmented and virtual reality revenues are projected to top $120 billion in the US by 2020. (5) Virtual reality is able to transpose the user, through closed visors or goggles. It provides retailers with the ability to create a virtual store to visualise the store layout before actually building it. This allows them to test our their concept and ensure it will provide the best and most optimal customer experience.
Augmented reality is used by customers to try a product before buying it. For example, if I wanted to view a carpet in my room, I could use augmented reality on my phone to see the carpet on my floor to make sure it is suitable before purchasing it. In years to come, we can expect that this new way of shopping will become a way of life. As augmented reality, virtual reality and other technologies develop, stores will gain better insights into their customers’ behaviours. This will allow them to use their loyalty programs to target their customers’ specific needs and offer the most unique and personalized deals based off their past purchases.
The technological world is changing exponentially, so it is imperative that retailers keep up. The time where consumers decide whether or not to shop at a certain store based on the technological customer experience has already passed, and they will continue to expect more and more in the future. Harnessing new technological innovations to provide the best shopping experience is key to success in the retail industry.