February 10, 2017 | Written by: Vish Ganapathy
Categorized: Cognitive | Industry
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Though the retail industry is rapidly changing, one fact remains constant: the customer is king.
Some 35,000 attendees made their way to the National Retail Federation’s “Big Show” (NRF) at New York’s Javits Center last month for a first-hand look into the future of retail. Talk of digital transformation created buzz on and off the show floor.
Just south of the show at the IBM Bluemix Garage in Soho, some of the industry’s revolutionary leaders gathered for a roundtable discussion on how cloud and cognitive technologies are becoming an integral part of how retailers reach and meet shopper’s expectations.
Attendees included Staples CTO Faisal Masud; Shop Direct CIO Andy Wolfe; Retail Systems Research analyst Brian Kilcourse; Forbes retail and consumer trends contributor Barbara Thau; The New Stack journalist Darryl Taft; IBM Bluemix Garages Worldwide Director Shawn Murray; IBM Blockchain program director Eileen Lowry; and Pace University clinical professor of management and Entrepreneurship Lab director Bruce Bachenheimer. The group took a close look at how retailers experiment with new ways to give customers what they want and drive that transformation using cloud and cognitive computing.
Consumers drive tech adoption
Retail is a famously reactive business; it’s slow to adopt new technologies and innovation. However, in today’s consumer-driven age, retailers must quicken their pace, often setting aside internal strategies to tune into consumers’ demands and adopt the technology necessary to keep up.
Yet that’s often not the case. The IBM 2017 Customer Experience Index study found that 84 percent of retail brands offered no in-store mobile services and 79 percent did not give associates the ability to access a customer’s account information via a mobile device. These are key services for a seamless customer experience.
Retailers must capture the attention of consumers armed with smartphones and tablets. They are comparing product prices and reading reviews on social networks all the time. The hyper-connected consumer is the new norm, and understanding and engaging with them in real time is essential.
What customers really want
While retailers are busy selling, customer expectations are changing by the second. Retail is now about providing high-quality, engaging experiences.. Forward-thinking retailers use cloud infrastructure and AI-powered innovations such as cognitive chatbots to amplify and augment, not replace, the core human element of retail.
For example, for a retail recommendations strategy, Masud said that Watson Conversation on IBM Cloud helped Staples discover a gap between what the company assumed customers wanted and what they actually wanted. When Staples worked with IBM to develop its “Easy Button” virtual assistant, Masud said, “We thought we would just be making recommendations for more office supplies based on their purchases.”
What Staples found was that customers were also seeking solutions to help track administrative details in their office. “They wanted us to remember things for them like the catering company they used or the name of the person who signs for the delivery,” Masud said.
A cloud-powered, cognitive technology solution provides clear benefits for Staples. As it continues to learn customer orders and preferences, the office-supply-ordering tool continues to improve its predictive and order-recollection capability, making it more valuable to users for everyday tasks. Staples can bring the on-demand world to customers, allowing them to order anytime, anywhere and from any device.
“The one thing customers want is ease,” added Shop Direct CIO Andy Wolfe. He noted people want to easily shop online from whatever device or online channel they prefer. Shop Direct is the UK’s second largest pureplay digital retailer.
Retailers must have actionable insights derived from backend systems data such as supply chains, as well as the data that customers produce and share.
Shop Direct had a wealth of data, but needed to identify the most important information, which is why the company adopted IBM Watson and IBM Cloud. Shop Direct wanted to better understand customers and run its business more efficiently to meet shoppers’ needs.
Wolfe and his team were able to use the power of cloud and cognitive to mine and understand data, turning it into a resource to personalize the company’s retail product offerings and make brands even more affordable for customers.
The future of retail and technology
“There will always be retail,” said Brian Kilcourse, analyst at Retail Systems Research. “It will just be different.”
The nature of shopping is evolving from a purposeful trip to a store or a website toward the “ubiquitous shopping era”: shopping everywhere, by any means, all the time. This has created a significant challenge for retailers to create an operationally sustainable and engaging experience that inspires loyalty as customers hop from store to web to mobile to social and back again.
That’s where cognitive and cloud comes into play. Retailers can harness the power of data from their business and their customers to better personalize, contextualize and understand who customers are and offer them the products they want when they want them.
Timing and convenience are key for customers now. Cloud and cognitive technologies enable brands to authentically connect with consumers in an agile and scalable way. Cloud is no longer an IT trend. With apps, chatbots and new ways to reach customers, it is the platform keeping retailers available to consumers and in business.
Learn more about IBM Cloud retail solutions.