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Review: Digital Transformation Strategy 2021 Part Two

Customers have been much more embracing of retailers’ digital solutions during Covid-19 including the use of apps and live video link-ups, which has enabled businesses to… View Article

GENERAL MERCHANDISE

Review: Digital Transformation Strategy 2021 Part Two

Customers have been much more embracing of retailers’ digital solutions during Covid-19 including the use of apps and live video link-ups, which has enabled businesses to deliver much richer digitally-driven experiences to their shoppers across channels.

Speaking at the second part of The Retail Bulletin Digital Transformation Strategy 2021 webinar David Stacey, commercial and operations director at Ribble Cycles, highlighted how the company has built a digital presence that compliments its new stores, which utilise technology solutions that help shoppers develop their own personal multi-channel journeys. These include linking customers at home with in-store assistants via video and the use of large in-store screens that enable shoppers to interactively build-a-bike.

Technology has to be useful

“I hope we’re a true omni-channel business that is digital-first. The technology has to be useful. It’s about making the journey better. It’s not just about putting bells and whistles into the store. Gimmicks are the wrong thing to do – the technology has to be useful,” he says.

Matthew Furneaux, director of location intelligence at Loqate, says retailers have to be careful with how they handle parts of the customer journey. Whereas there is much talk about removing friction – especially around the checkout – it can be the case that for certain product types having some friction in the journey is beneficial.

“Not every process needs to be lightning fast. If you buy a £2,000 guitar you don’t want it to take two minutes, you want it to take an hour. There is good and bad friction,” he explains.

Such considerations were taken into account when Graham Wilson, head of business development at Sofology, adopted a video service before the pandemic in order to connect customers to its stores. Early use of the solution was often to finalise the transaction following a customer’s visit to a store where they had done the “sit test” on their sofa of choice.

Boosting revenues and experience

During Covid-19 it became a vital tool and although its use has normalised now stores are fully open Wilson says it continues to bring great value to the company: “It makes shopping so much easier and there is a greater propensity for customers to convert. It’s 5-times more likely, and the average order value is 40% higher, than for other customers,” he says.

Such solutions help boost the experience across channels and it was for this reason that Victoria Betts, chief commercial officer at Hotter, developed an app with augmented reality (AR) capability to enable customers to try on virtual shoes at home. “Consumers use their phone to look at shoes on their own feet. It has high levels of adoption and the conversion rate is three-times greater than for customers who don’t use it. And there are less returns,” she says.

The return rate is reduced further by Hotter also having a sizing solution whereby it takes a 3D image of the person’s foot and from this makes a perfect recommendation of the right shoes. “This can be done in-store or through the app. Customers engage with it in droves and the P&L benefits of the solution are absolutely significant.”

Take care with data accrual

Betts also points to the fact that Hotter collects data related to these interactions and can leverage this “digital currency” to improve its business. Ayla Erimer, head of product at LoveHomeSwap, also utilises data but is very careful with avoiding using it for personalisation unless there is an obvious payback otherwise it can just look “creepy”.

The company simply asks two or three very basic and anonymous questions ahead of it showing any personalised options of homes to swap. “We funnel it all into the acquisition journey but then we put people into the conversion journey subtly. There are no short cuts to personalising the journey,” says Erimer.

Steve Ledgerwood, chief revenue officer at Findologic, agrees it can often be sensible to ask questions before showing any search results as this avoids showing any irrelevant results that could detract from the conversion. Complimenting this process could be the addition of virtual assistants that ask questions in real-time and further help the retailer hone in on the customers’ particular requirements.

Personalising the journey

By accruing this data on individual shoppers the potential to improve conversion rates is clear. This was recognised by Janis Thomas, e-commerce & marketing director at Look Fabulous Forever, who has used this information to serve up different journeys on its website depending on a customer’s interactions.

“We know that for those customers buying primers or traditional products like lipstick it could be their first purchase with us so we serve them up the story of the founders on the website because we are unique and we want them to hear about the founders. But when it is skincare then they’re probably not buying this as a starter purchase. These products typically come later and they’ll know the story by then,” she explains.

For Lisa McIntyre, product manager at Nuxeo, it is this type of rich media that helps it work with retailers to ensure they connect with their customers: “Retailers need to be authentic and speak the brand. We can help them tell it through audio, visual, and video. To help build trust it needs consistency. The data enables us to make suggestions to retailers – based on what’s been bought in the past, what’s in their cart. This allows us to speak the consumers’ language.”

Ensuring CRM systems are fit for purpose

With retailers having ramped up their digital transactions as a result of Covid-19, Steve Farr, VP of marketing & solutions at Experian, says there has been a realisation that the underlying data in many organisations has “not been up to scratch”. This prompted many retail executives to question whether their CRM systems were fit-for-purpose. “Over 50% did not trust the data in their CRM systems. There are a number of issues such as how to stop bad data getting in and ageing data, which is a problem that never goes away,” he says.

As well as addressing the shortcomings of the data generated within their businesses Farr says there is a move by some companies towards recognising that they do not have the right data and they are investigating what open source data is available. “There is a big move towards Data for Good whereby businesses share some of their data and hope that others do too,” he suggests.

Gracia Amico, chair of Closer Pets, agrees the power of CRM systems and the data fed into them cannot be underestimated. She therefore finds it surprising that few companies handle this side of their business well. “You need it to ensure that you know what your customers are doing and for all the people in the organisation to know what’s happening. When companies do it well then it makes a difference,” she says.

Words by Glynn Davis

Join us on 18 November for Digital Transformation Strategy Part Three. Get your free place here

 

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