CHICAGO – The pace of change is never going to be as slow as it is today, said Vish Ganapathy of Accenture Consulting, and keynote speaker at the Conexxus Annual Conference. And because of these changes, customers have been given a plethora of choices that reveal one constant they care about most: time.
How consumers engage with other services that focus on a convenient experience, like Airbnb, Uber, Netflix and Amazon, are changing the way consumers approach retail in general—all because of technology.
Ganapathy suggested that retailers also need to consider the expectations their own employees have with technology and how it applies to their job responsibilities. For example, if your staff relies on Uber for transportation and orders groceries from Amazon, how much longer do you think they will be engaged in the workplace removing paper shelf tags when technology, like electronic shelf tags, can modernize an antiquated business process?
A key area retailers should be considering as they look to enhance the consumer experience is curation, which is often described in retail as the process of creating personalized product selections and offerings. Perhaps one of the best curators in retail is Amazon, but it would be extremely difficult to out-Amazon Amazon. Convenience retailers can, however, worry less about what’s on store shelves and begin to worry more about who’s in their stores and why.
“When we think about curation and reimagining how people work, the way to do that is to leverage technology,” Ganapathy said.
By using artificial intelligence (AI), Ganapathy noted that retailers can transform the merchandising process by allowing the technology to determine product and brand assortment. The time saved brings greater efficiency to retailers in that allows employees to become better curators and trusted advisors to their customers.
“Let’s use technology to figure out all of the areas where we can gain efficiency and use the time for higher value activities,” he suggested. “That’s what will make a difference in this ultracompetitive world.”
A reason curation and bringing more efficiencies to retail is becoming increasingly important is because of the rise of mega-platforms, like Amazon, Alibaba and Walmart. “These mega-platforms are a collection of ecosystems that are highly integrated and create a gravitational pull,” Ganapathy said. “This is why you have companies like Nike giving up and selling their products on Amazon.” In fact, some retailers have been evaluating whether it’s worth upping the ante on their own digital platforms due to the competition exerted by these mega-platform retailers.
“It’s hard to compete against these mega-platforms because it would completely disrupt your value chain,” he said. For convenience stores, “you’ve got to rethink what your business is going to look like in the future.” Case in point, are you going to be a fuel retailer that just sells gas or become an energy provider for connected consumers?
“Technology is easy,” said Ganapathy. “It’s the people and the process that are hard. It’s not mobile and drones or IoT that are disrupting. It’s people who bring disintermediation to your value chain that is going to be disruptive.”
Noting that retailers today spend a lot of time focusing on the customer experience, Ganapathy said that if they are not also focusing on the business model and the value chain, then the overall customer experience will be like putting lipstick on a pig. “It’s not going to be sustainable. You have to think about how your value chain is being disrupted."
For example: What happens if cars drive themselves and customers no longer have a reason to come inside your store? What happens when there are no gas pumps? What happens when customers don’t have to wait in a checkout line? “The technology is the tip of the ice berg; it’s the business process model that has to change,” he said.
Ganapathy highlighted five technology trends from Accenture’s Technology Vision 2018 report that are transforming society and creating the foundation for future enterprise growth:
1. Citizen AI: By “raising” artificial intelligence responsibly, businesses will create a collaborative, powerful new member of the workforce. “We all know artificial intelligence is here to stay and I think it has a lot of promise,” he said.
2. Extended Reality: Immersive experiences are changing how we connect with people, information, and experiences.
3. Data Veracity: Businesses must adapt existing capabilities to combat a new kind of vulnerability: inaccurate, manipulated, and biased data that leads to corrupted business insights. “We are all data rich and information poor,” he said. “Data scientists spend 80% of their time cleansing data and getting it to a point where they can start asking interesting questions.” In fact, the data a retailer uses to enable AI will become the competitive advantage.
4. Frictionless Business: To fully power the external technology-based partnerships they depend on for growth, companies must first move on from internal legacy systems and re-architect themselves.
5. Internet of Thinking: Enabling intelligence for the next generation of technology demands an overhaul of existing infrastructures. Oftentimes, this can be accomplished through strategic partnerships.
Ganapathy also shared examples of retailers that are enhancing their frictionless business or using technology to increase consumer engagement with technology:
- Subway is transforming stores to look and feel more like a Starbucks, encouraging customers to relax and connect by offering Wi-Fi, charging stations, etc.
- Carrefour Brazil has “Pinterest points” throughout the store that inspire customers to cook.
- KFC in Taiwan and 7-Eleven in Taipei are using facial recognition.
- Kroger is using IoT for digital shelf tags
- Carrefour Europe, a food blockchain allows consumers to track the journey of their food through the supply chain
- Filld, an on-demand app-based service that brings fuel to vehicles, is also investing in autonomous vehicles to optimize routes.
Sure, changing a business model will not happen overnight, but there are a few thoughts to bear in mind. “What’s important is figuring out how to use analytics and not make decisions based on gut feelings,” said Ganapathy. In regard to innovation, remember that the whole point behind innovation is taking risks. “If you aren’t taking risks then you’re fast-following.”
And remember: It’s not all about what’s on your shelves. “You’ve got to figure out how to get customers inside your store. The more things go online, the more things become self-service, the more technologies disintermediate the supply chain and value chain, there’s less reason for people to walk into your store,” said Ganapathy.
The 2018 Conexxus Annual Conference, attended by the industry’s leading technology experts and management, featured face-to-face meetings of all Conexxus committees and working groups to further data exchange standards in device integration, payments, enterprise integration, mobile commerce, supply chain and data security. For more information visit conexxus.org or join the group’s ongoing conversation on LinkedIn.