Page 52 - RetailWorld-May2021-Tobacco-Updated

TECHNOLOGY SHAPING THE 21ST CENTURY SHOPFRONT We’ve been fortunate in Australia that the initial upheaval of Covid-19 has largely subsided, and retailers have returned to a level of ‘normalcy’. However, we can’t ignore that the pandemic has been a catalyst for one of the most seismic shifts in consumer behaviour in the past 10 years. ABy Accenture Retail Lead for Australia & New Zealand Michelle Grujin. ccording to ABS data, total online sales averaged a rise of 67.1 per cent from March 1 to October last year, an Australia Post e-commerce report stating that Australians spent $50.46 billion online in 2020, up from $32.1 billion in 2019.2 If we thought we could ease our way into the digital transition, we were wrong. Covid-19 has kicked us hard and fast right into the 21st century, with e-commerce emerging as the dominant force in retail. Revealing the store of the future ... the couch Throughout the pandemic, the home became the heart of the consumer experience. When it first hit, consumers surged to digital commerce, and the practice lingered on as they began demanding omnichannel services such as digital chat functions and virtual consultations. In returning to ‘normalcy’, Australian retailers now have a unique opportunity to craft what the new normal looks like for Australian retail, and how this will manifest in terms of customer experience. The opportunities for retailers to grow their businesses through digital is crystal clear. Retailers that still generate the bulk of their revenues from physical stores are in urgent need of revising their operating model, which involves re- evaluating the following key areas of their digital strategy. Digital leadership It’s critical that retailers stop isolating their digital services from their traditional offering. Retailers of the future will incorporate digital as part of an ecosystem that enables consumers to engage with the brand in new ways and adds a layer of convenience to the experience. In the store of the future, the retailer’s digital footprint will be its shopfront, and investment into digital platforms and fulfilment infrastructure to cope with customer traffic online will be vital. Digital customers will also expect a customised shopping experience based on their digital buying behaviour – which means an ability to apply data and analytics at scale to understand the consumer at every step of their buying journey. A great example of this was global beauty brand Mecca, which leveraged machine learning technologies to implement a personalised email marketing system in just a few weeks.3 This resulted in a 65 per cent increase in email click-through rates and a corresponding increase in email revenue for the brand. Retailers need to adopt a digital-first mindset for prioritisation to occur across the organisation and ensure integration into all aspects of operations – from marketing to supply chain and bricks and mortar stores. The days of digital silos are over. The retailer of the future needs to ensure it has an end-to-end digital operating model that delivers on consumer expectations. The future of bricks and mortar It’s important to acknowledge that the rise of digital commerce doesn’t signify the death of stores. The physical experience of retail therapy will continue to live on – and we’re all better for it. However, by leveraging digital technologies, retailers can bring their brands to life and drive personal interaction with their consumers like never before. Technology will be vital in helping stores ramp up digital fulfilment, through processing alternative options such as click and collect, home delivery, and ship from store. Stores that are no longer in use for sales can be used as fulfilment centres for online orders – otherwise known as ‘dark stores’. These enable retailers to have clear visibility on their store inventory and help manage fluctuations in online versus in-store demand. Foster the supply chain The store of the future will be heavily reliant on the ability of their supply chain to be flexible, have enhanced digital capabilities of its own, and be accurate and efficient end to end. Businesses that maintain healthy relationships with their suppliers and leverage technologies such as robotics, automation and AI will be able to better balance capacity versus cost in their supply chain network, forecast demand and provide necessary data to suppliers quickly. Retailers should embrace this moment of being on the cusp of change, to become world leaders in defining the store of the future. They should use this time to reset and reinvent their business to prepare for the e-commerce century and drive growth and profitability, as rapidly evolving customer expectations become increasingly centred on the digital storefront. References 1. abs.gov.au/articles/online-sales-october-2020- supplementary-covid-19-analysis 2. auspost.com.au/content/dam/auspost_corp/media/ documents/ecommerce-industry-report-2021.pdf 3. retaildive.com/spons/drive-business-growth-with- machine-learning-personalization/589639/ About Michelle Grujin Michelle is the Managing Director of Retail for Australia and New Zealand at Accenture and has more than 20 years of hands-on experience in the retail industry. About Accenture Accenture is a global professional services company with leading capabilities in digital, cloud and security. Combining unmatched experience and specialised skills across more than 40 industries, Accenture offers strategy and consulting, interactive, technology and operations services. 50 RETAIL WORLD MAY, 2021