Today’s retail landscape is more competitive than ever before, so it is crucial for businesses to embrace digitalisation and new technologies to gain and maintain a competitive edge in today’s market. As the retail sector attempts to keep up with changes in consumer behaviour and customer experience expectations, failure to bridge the gap between what buyers what and what brands offer can often mean the end of a business. Massive retailers including Patisserie Valerie and Coast have shown severe distress signals this year, and it is becoming imperative for brands to continuously perform at the top of their game in order to survive against the challenges posed by competitors and market fluctuations.
Longstanding womenswear retail chain Bonmarché felt the struggles of a downturned high street earlier this year, when shares in the company dropped 18 per cent after a warning that profits would fall short due to weak consumer demand. Other retailers have also fallen prey to the worsening retail environment, with several well-established chains having closed stores or seeking serious financial restructuring in order to survive, including Toys R Us and Debenhams. It is becoming increasingly clear that change needs to happen, and that brands need to innovate to survive. Overall, brands that fail to offer good customer experiences will struggle. Little but impactful technological changes could make a huge difference to a business’ operations and profits.
Digital transformation is huge and can often feel like a mountain to climb. However, despite what retailers may think, it doesn’t always require huge business model changes and drastic process shake-ups. As it becomes clearer that customer experience is the key to driving sales, businesses should not overlook the benefits of making small changes that can greatly enhance the experiences of their customers. This is especially crucial given that over half (56 per cent) of international adults are more likely to choose digital resources for recommendations on products and services. Strong ‘word of mouth’ is vital, and good customer service is intrinsic to this.
The help of AI
Artificial intelligence (AI) can help retailers analyse customer behaviour, journey data and assist in identifying their individual needs – so they can then be met. By starting to predict what customers want, and need, AI (in tandem with machine-learning) can elevate the whole shopping experience to another level. As it stands, only 7 per cent of retailers currently use AI to enhance their services, and this should increase as retailers see the benefits that AI-driven technology can provide.
Thread, an online start-up, has used AI to assist men in selecting clothes – and subsequently raised £16.7 million from investors, further demonstrating that retailers should look to new, AI-driven technologies to stay competitive. Interactions and conversations between humans and brands become more productive for both parties with AI-enabled technologies. This is because these technologies combine artificial intelligence and data to provide analytics – learning from and responding to a slew of data points in a way that no human ever could. With these analytical insights available, high street retailers can provide the empathetic, responsive service that customers appreciate and increasingly demand. It’s a win-win: consumers get a customised service, and retailers benefit from their improved customer satisfaction which builds brand loyalty and ultimately helps boost market position.
Despite what retailers might think, AI doesn’t always have to mean going as far as installing a team of robot workers to keep up with the digital landscape. However, robot-driven technologies can certainly help. When it comes to the specific technology elements that retailers can implement to start reaping the benefits of digital transformation, dynamic call numbers are just one example of how simple elements can offer huge growth benefits. Simply put, these are unique phone numbers, assigned to each visitor, that are automatically displayed on a brand’s website or in a digital advertising campaign. This simple feature gives businesses the ability to track a specific customer’s journey, and provides extended data insights into that customer, helping to deliver a tailored customer experience.
Putting customers at the heart of business operations
Retailers can also look to geographical call routing as a method of attracting their target customers across different regions. Call routing allows users to understand the digital context of each visitor, such as by discovering why they were visiting the site, where they came from, and why they ultimately contacted the brand. With this rich contextual data, businesses can then target the customers who truly want to buy and prioritise the journey of these customers through to specific call handlers who are trained and equipped to handle their enquiries most effectively.
Using a dashboard to analyse customer insights and enabling call tracking are also simple functionalities that businesses can utilise to drive growth. For example, enabling customers to text customer service departments, instead of having to call them (and most likely be put on hold or stuck in a long queue) can help speed the process up – both for customer service teams and for customers themselves. This is especially effective when targeting key audience demographics. For example, millennials tend to prefer text messaging over making phone calls, so for businesses who cater to this age range as their primary sales segment, implementing this type of tech is a no-brainer.
Retailers need to put customers at the heart of their business operations, now more than ever. They should also use data insights to not only enhance customer experiences, but also direct investments in the long run for optimal growth. Advertising and marketing campaigns have previously involved putting large sums of money into campaigns to increase profits, without generating insights post-campaign to understand its effectiveness. This is not a sustainable, or wise, way of spending – and could lead businesses to ruin later down the line.
In today’s competitive marketplace, companies need to make use of every tool they have at their disposal – as well as investing in new tools – to minimise chances of failure and maximise success. Spending lots of money doesn’t have to be the answer – but spending in the right way, on technologies that improve customer experience, will be vital in the coming months and years.
Anne de Kerckhove, CEO, Freespee
Image source: Shutterstock/Wichy