Retail success is now being driven by a set of new measures, according to original research in a new report from Practicology and Arvato, a global provider for full-service ecommerce and supply chain solutions.
The Retail Innovation Report warns that traditional - single channel - management information reporting could be holding retailers back. As well as measuring historical data, brands and retailers should be using forward-looking metrics, such as Net Promoter Score, to assess their performance and apply insights across multiple channels to better meet the needs of omnichannel shoppers.
Joanna Perry, Head of Marketing at Practicology, commented: “Retailers now understand how crucial it is for them to have a single view of their customers across all channels, and their next stage of evolution will see them better predict future customer behaviour and make use of key performance indicators that acknowledge customer journeys can involve several channels. To underpin this work, retailers need to give prominence to the creation and use of customer insight, and we’ve already seen a few forward-thinking retailers such as House of Fraser and Shop Direct Group put insight at the heart of their organisations.”
With innovation continuing to be a focus for retailers, original research in the report identified five top priorities, which retailers are looking to deliver over the next three years. These included:
Single customer view: A 360⁰ view of the customer alone is now viewed as ‘mission critical’ to deliver the seamless experiences today’s connected consumers demand. But, whilst a single customer view provides retailers with actionable insights based on shoppers’ past behaviour, to take this further retailers require more predictive capabilities.
Agility: Most retailers interviewed outlined their focus on being better able to respond to sudden uptakes of technology by consumers, such as smart watches and TVs. However, most couldn’t pinpoint which technologies would take off, further underpinning the importance of agility in business models.
Mobile: Smartphones are now regarded by retailers as the ‘front door to retail’, often representing the start of consumer journeys, whether shoppers convert online or later in-store. Retailers are looking more strategically at using mobile to drive consumer into store as well as capturing mobile data to drive conversions in the physical retail environment.
New store formats: Online performance is shining a spotlight on weaker in-store execution, meaning retailers acknowledge a change to the role physical stores play in consumers’ omnichannel encounters. Not only do they recognise a need for stores to be more inspiring – delivering value over and above a simple transactional experience – but also, in a time when shoppers value convenience, stores must also adopt the role of a mini distribution centres for online orders, creating slick click-and-collect operations.
Fulfilment: With 1.16 billion packages due to be despatched via carriers for online retailers in 2016*, fulfilment presented a key innovation focus in terms of achieving ‘hyperconvenience’ for shoppers; the retailer panel agreed those who fall behind or fail to innovate in delivery services would risk losing customers.
Claire Muir, Business Development Director at Arvato, added: “Today’s connected consumers’ demands are driven by convenience and personalisation – and retailers need to meet these needs in a frictionless fashion across multiple channels. Traditionally, retail innovation was about enhancing operational efficiency. Now, to deliver true value, retail technology must answer to its impact on enhancing shoppers’ experiences.”
Download the full Retail Innovation Report.
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