For years, we have heard about the digital transformation of retail. In line with every other industry that puts a premium on customer service, the sector invested, experimented and gradually refined the way it delivers the right products to the right customers, at the right time – in an increasingly digital-first way.
And then it happened. A global pandemic which, for many essential industries, brought crippling challenges and vast opportunity in equal measure. Underneath the supply chain strains, IT infrastructure creaks and final-mile fixes, the greatest digital acceleration we’ve seen for decades is underway.
Ready or not, every retailer and high street brand has been forced to imagine a cashless society where the high street is dead and the digital high street reigns – adapt or die. Now, heading in to the golden quarter, retail’s biggest peak, will be the ultimate test.
The partnerships, initiatives and M&A we’ve seen during 2020 has been the change we all saw coming, but at hyper-speed. Consumers were already heading online – and increasingly on-mobile – for their goods in droves, seeking and receiving more personalized experiences in the cut-throat world of eCommerce, where a one-second page load delay could cost a company $1.6bn a year. The key ingredient which makes it all possible? Data.
Even as Amazon’s remarkable ‘Just Walk Out’ technology tests the potential of experiential, frictionless high street commerce, and IKEA joins forces with Alibaba’s Tmall to blend real-world with digital-world shopping, data is the key. As eCommerce seizes supremacy and futurists ponder the potential of ‘mixed reality’ retail experiences, data will bind it all together – allowing retailers to transact safely, understand and delight their customers, across borders and time zones.
Amidst this technological acceleration, a reliance on data and digital-first experience will present a new challenge: digital trust. To understand why, we need to rewind and think more broadly about the digital economy.
Powering access to the digital economy
We as consumers benefit – often unknowingly – from identity technology. How many times recently have you bought something online, or checked your bank balance with a fingerprint login? All of these interactions rely on the ability of businesses to safely and seamlessly verify your identity.
Many of these services are leveraging the power of connected, global datasets to verify who a person is, where their order is going, and if a product or service is available in their area. Those leading the way here are thinking beyond tradition – using new, innovative tools like integrated APIs, machine learning, and hardware like smartphone microphones, accelerometers, and fingerprint scanners, all in the name of identifying ‘Customer X’ as ‘Customer X’.
Providing seamless experiences
In a new, digital-first retail environment for retail, where customers can blend shopping experiences across channels and retailers can enable it without sacrificing on security, the reliance on this type of identity data will be profound.
GBG’s own research last year found that digital-first and digital-only retail brands are outpacing the rest of the industry. Brands like Gymshark and Paul Valentine – natives to the digital space – understand the importance of a frictionless consumer journey that can be shaped to meet the needs of shoppers globally, by following a set of standards that don’t necessarily come naturally to traditional retailers.
Of course, ensuring that customers have a seamless, secure journey on the website is only one step. Data plays a role right across the value chain. Retailers then need to ensure they’re capturing hyper-accurate address data, for example, to avoid the double-cost of failed deliveries – wasted revenue and loss in customer trust.
We’re excited to be working with pioneers like what3words, to bring pinpoint accurate delivery to thousands of retailers and address that classic final mile challenge. This will be extra valuable this Christmas, as those who are vulnerable, shielding, or unable to see family and friends rely on ecommerce to deliver our presents right to their door, first time.
Global pandemic, new dynamic
As retail goes borderless, supply chain bottlenecks will have a huge impact globally. But further downstream, there have been opportunities to find efficiencies at local and regional levels.
This year, we’ve seen even more suppliers - like Aldi, M&S and Co-Op - ink deals with delivery networks as a way of rapidly extending their supply chain and 'bootstrapping' their delivery experience. The partnerships highlight how Covid-19 has led to a major switch in customer needs. Those who may not have previously headed to websites to do their shopping – I call them ‘Generation Zoom’ – now need to rely on the power of global ecommerce.
We’re seeing how critical it is for people to be able to access these services, in a way that suits them. To give customers an optimal digital alternative to real-life experience, during uncertain times, multinational brands are opting to extend their storefronts to the likes of Deliveroo and Uber, in exchange for a scalable, seamless front-end experience.
For retailers transitioning to digital for the first time, the ability to get products to customers quickly and efficiently will be crucial to success. Integrating addresses and location data into delivery operations will allow customers to check out faster, confirm the correct delivery details, and make sure that products are sent to wherever they may be.
What’s more, leveraging contactless enabling technologies such as address verification can do much more than confirm individual’s address. It can verify their identity – and ensure orders get to their destinations with minimal disruption to the consumer, which means people are able to access items they need without having to worry about leaving the house.
For almost any consumer-facing brand, familiarity engineers trust – and we’ve certainly become more familiar with our digital high street throughout 2020. For retail players equipped to succeed in the digital economy, that means they now face the ultimate test this golden quarter: deliver on seamless, secure experience and lock that trust in for years to come, or let customers down and lose trust they may never win back.
Matthew Furneaux, eCommerce expert and Director, GBG