Staying two steps ahead of customer expectationsTechnology | Marc Caltabiano 20 Jan 2020
Modern consumers want three things from brands: speed, personalization and convenience. Retailers who fail to meet these expectations risk losing business. The key to winning over consumers lies in the ability to exceed their needs by giving them what they want even before they can ask for it.
To remain competitive in today's digital world, retailers need to use consumer data to anticipate needs, quickly launch new products and services to market, and provide consistent and seamless experiences across all physical and digital channels.
However, to deliver these experiences, retailers need access to customer data - perhaps the most valuable, untapped resource in businesses today.
Too often, this data is trapped in fragmented legacy systems, which are costly and time consuming to manage. In addition, legacy systems are difficult for business users to access, slowing innovation down as newer technologies like the internet of things and artificial intelligence are introduced.
The opportunity that lies in unlocking customer data is undeniable, especially as shopping becomes more digital. According to Nielsen's Connected Commerce Report, global online sales in 2017 totaled US$2.3 trillion (HK$17.94 trillion) - or 10.2 percent of total retail sales - and are expected to reach 17.5 percent by 2021. In Hong Kong, the number of e-commerce users is expected to grow from 4.15 million in 2017 to 5.35 million in 2021 - in a total population of 7.35 million.
With the right strategy in place, retailers can unlock data to gain a 360-degree view of their customers.
To achieve this, many retailers are turning to application programming interfaces to connect disparate systems so that they can exchange information in an application network. Organizing and connecting this data in a standardized manner better equips retailers to deliver the connected experiences consumers want.
As consumers increasingly demand personalized experiences, retailers must use more applications for each customer touch point and to provide increasingly specialized services. For example, an online purchase can require a wealth of data from an array of specialized applications (eg, warehousing, inventory, purchase history, order management and invoices). Servicing the customer now requires dozens of software-as-a-service applications.
Connecting data from all of these systems gives retailers rich insight into their customers' digital footprints. When retailers understand consumer behavioral patterns, they can create tailored experiences for shoppers.
For example, a retailer might offer product recommendations based on recent purchases, or auto-fill a form using information already provided.
But establishing a unified customer view is not always easy.
According to MuleSoft's 2019 Connectivity Benchmark Report, data silos made it challenging for 83 percent of respondents. Retailers often use hundreds of on-premises and cloud applications, while consumers interact with retailers across different channels like stores, mobile apps and online chats, creating disparate sources of data.
Meanwhile, customers expect retailers to have an accurate view of who they are: 76 percent expect companies to understand their needs.
In order to deliver on the capabilities customers crave, the most effective digital enterprises are using application program interfaces. Retailers can aggregate, organize and orchestrate key data across systems to build a holistic view of the customer.
Asia's leading luxury department store Lane Crawford tackled this challenge head-on by launching its first mobile shopping app.
By connecting its customer relationship management and e-commerce applications through interfaces, Lane Crawford was able to create a data-as-a-service platform to orchestrate 360-degree views of customers and inventory, such as up-to-date loyalty balances and shopping history. The same interfaces are used across digital channels, including its new mobile app, website and WeChat.
The mobile app was just the start. The retailer has set up an innovation team and is building a repository of interfaces to maximize IT reuse. Future projects will focus on expanding WeChat capabilities and creating apps to increase operational efficiency.
Marc Caltabiano is the regional vice-president of MuleSoft