They say fortune favours the brave, and that has certainly been true in the tech world; companies with a bold, ambitious vision and an appetite for endless experimentation have proved the most successful.
According to a new report, it’s time for retailers to start thinking like tech companies – or risk stagnation.
As reported by Net Imperative, the report from marketers Conversity explains that traditional retail firms need to be more agile and innovative in order to attract and retain customers. This means developing a greater acceptance of risk.
The reinvention of John Lewis
John Lewis’ response to the challenging environment illustrates the new trend. In 2017, the retail giant saw a 22% decline in profits. It decided to ‘reinvent’ its stores and improve customer experience by becoming more innovative.
The new approach from John Lewis involves experiential stores to enhance customer experience, a new technology platform and a plan to develop a smoother customer journey. Waitrose, John Lewis’ sister brand, is also targeting customers with more personalised offers and product recommendations through the loyalty card scheme.
Conversity CEO Dave Stark said: “John Lewis has seen a sharp drop in profits, but is looking to immediately do something to reverse its fortunes, by listening to customers and focusing on fresh initiatives designed to align with modern consumer behaviour.
River Island’s Approach - Drawing In Diverse Talent
Traditionally, retail systems have been based around a monolithic, retail-specific legacy architecture. River Island recognises that innovation requires a broader outlook, building on expertise developed by tech companies and developments in other sectors to drive performance.
River Island CIO Doug Gardner said: “We know we have to think and act like a tech company. That’s why a significant proportion of our new hires come from a non-retail background - we value a fresh pair of eyes that think about ways of handling data, rather than ways of building systems specifically for the retail sector.”
“Our focus is on building a seamless, multi-channel customer experience. We think about how our customers like to to interact with us on a daily basis. The experience must rival the experience they get from using lifestyle apps such as Uber or Spotify. These tech platforms are the new benchmark, not other retailers. To achieve this, our teams are working with data lakes, open APIs and microservices - it’s much more about data flow and less about retail.”
Thinking Long-Term
Big tech companies start with a long-term vision and set out to change the marketplace. The likes of Amazon, Google and Apple are successful because they do things differently to other players in the space. They develop products and services that innovate based on an interpretation of what consumers need.
For example, Amazon Go recently launched with checkout-free stores, identifying consumer demand for a seamless retail experience without the hassle of queues and payment transactions. Where a retailer can mark itself out in this way with a remarkably different service, consumers are presented with a clearer choice and can see the added value provided by the innovator.
Being Prepared To Break The Mould
Retailers need to be bold in taking a strategic approach to development, being proactive in innovation rather than offering a slightly different version of what competitors offer.
Tech companies are changing the way we live our lives, offering smoother interactions in everything from taking a taxi to buying groceries or listening to music. River Island’s approach is about drawing from the best in data innovation, rather than focusing on a narrow retail context.
Do you have the skills and experience to help craft a smoother, more personalised customer experience?
There could be a place for you in our Delivery & Transformation team.
Source:
http://www.netimperative.com/2018/04/taking-risks-key-to-retailers-survival-report/