Transforming retail through customer-centricity
16 August 2016
The retail industry is going through unprecedented transformation, and a retailer’s success will depend on its ability to embrace this transformation to meet diverse consumer needs. Consumers increasingly expect a seamless, connected experience across channels (including web, mobile, social, and in-store) as part of the buying cycle. But though many organizations have evolved their approach to retail to address the changing needs of consumers, this evolution has had relatively little impact on the business model.
Beneath the customer touchpoints, the level of integration across channels is limited and often superficial as retailers get by with inefficient workarounds and fragmented data, which in many cases, adds cost to the existing operating model. SAP customers are often perpetrators of such inefficiencies as they, for a variety of reasons, have failed to take advantage of the end-to-end process and data integration that the SAP solutions have to offer.
But in a world of increasing consumer expectations, business-to-consumer (B2C) and business-to-business (B2B) organizations must integrate data and insights to deliver a seamless, one-stop-shop, Total Retail experience regardless of channel, or they will put their sales, customer engagement, trust, and brand reputation at risk. The need for retail transformation is being driven by four critical forces:
- Customers want personalized offerings and the ability to interact 24/7.
With a multitude of options available to the modern shopper, customers are now more fickle than ever. If retailers want to keep their customer base, they need to gather and analyse data in real time to understand the needs, preferences, and attitudes of diverse consumers, as well as personalize offers on a one on-one basis.
- Deeper insights are required for retailers to drive innovation as well as product and brand differentiation.
With infinite consumer choices across channels, retailers must develop new, innovative business models to introduce new products and link them to experiences that excite their target market.
- Customer loyalty relates to the brand.
Customers demand consistent interactions across channels with their preferred brands. Smartphone adoption has expanded their buying journey across many touch points, and they expect 24/7 availability along with a seamless experience across each channel.
- The customer experience is paramount.
Cross-channel shopping has increased service expectations, with precise delivery commitments being the new norm. Customers expect customized offerings based on totally protected personal preferences and information.
The challenge for retailers, I believe, is to adapt their business operating model to respond to these forces. Delivering a consistent and connected Total Retail experience requires a business transformation into a truly customer-centric retail operating model with seamless integration across channels, underpinned by integrated technology and data models. Competitive advantage in the 21st century is true customer centricity and the capacity for continuous innovation, executed fast and deployed nimbly. I will explore some possible solutions to this in my next blog.
Anthoula Madden is a Partner in PwC’s Retail and Consumer practice and leads PwC’s Digital Front Office initiative across EMEA. She has over 20 years of experience delivering SAP-enabled business transformation programs for clients, from strategy to execution on a global scale, with a focus on unlocking business value for clients.