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Estimated reading time: 1 minute
Retail Industry Viewpoints
Until recently, the global retail model had remained largely unchanged for hundreds—if not thousands—of years. The notion of creating a valuable commodity or product, showcasing it in physical premises, and selling it to the consumer is as old as currency itself. But now all that is changing. We’re making, selling, and buying things in entirely new ways, and the lines between supplier, manufacturer, and retailer are blurring.
“I’ve never seen the speed of change as it is today. If I could go back 10 years, I might have done some things earlier.”
—Millard “Mickey” Drexler, CEO, J.Crew, the Wall Street Journal (2017)
Groundbreaking new technologies, and agile, cloud-native competitors have given rise to the hyperconnected consumer. These new buyers have unprecedented power, information, and choice in the palms of their hands, and as a result, their expectations are higher than ever. But the same technologies that are disrupting retail markets deliver an opportunity to better understand the hyperconnected consumer, and deliver the frictionless, personalised experiences they demand.
To succeed in this new landscape, retailers and their suppliers must be willing to recognise, embrace, and become catalysts for change.
In 2018, retailers move from dabbling in creating new customer engagement strategies to larger commitments in reinventing themselves with a variety of new formats, experience strategies, and fulfillment options.
—IDC, Worldwide Retail 2018 Predictions
Estimated reading time: 5 minutes
The Latest News and Updates
To successfully adjust to a new retail landscape and effectively serve the hyperconnected consumer, you’ll need all the facts, figures, and insights you can get. But it’s impossible to read everything. That’s why we’ve handpicked a selection of links to provide you with the best information and opinions on the hottest topics in retail markets.
Adapt to data-driven customer expectations.
Discover five data-driven tech trends shaping customer expectations, and learn how businesses can adapt quickly to these crucial influences. From mobile “micromoments” to the AI-influenced 360-degree customer view, chatbot customer connections, IoT-driven insights, and customer experience cloud suites, find out how data analysis allows for richer customer understanding organisationwide.
Discover Oracle modern marketing.
Watch an interview with Steve Krause, group vice president of product management at Oracle Marketing Cloud, and explore how Oracle’s marketing platform brings data insights to the modern marketer. Steve joins John Furrier and Jeff Frick on theCUBE to discuss how Oracle is enabling the concept of modern marketing, and how businesses can build more valuable customer relationships.
Examine the changing face of in-store retail.
Join Wei Huang Oania, segment marketing manager for Intel’s Retail Solution Division, as she explores responsive retailing: the store’s secret weapon. Wei describes how technological convergence can deliver an optimised retail experience—in terms of both customer experience and profitability. Could the changing face of retail make things better for both the customer and the industry as a whole?
The latest from Oracle.
Optimise your supply chain.
Prepare to achieve new levels of business efficiency and transparency. Mike Johnson, Solutions Director, Supply Chain and Retail Enterprise, explains how Oracle’s latest supply chain management solutions impact nearly every aspect of retail supply chain operations—from inventory usage efficiency to time and cost savings. Find out more.
Estimated reading time: 4 minutes
Significantly reduce request handling time and operational costs with Oracle Service Cloud.
As a leading food retailer, Carrefour welcomes more than 13 million customers to its stores every day and some 2 million visitors to its websites. The company wanted to enable customers to contact Carrefour using a communication channel of their choice and to consistently receive rapid and personalized service.
Carrefour implemented Oracle Service Cloud as a unified, omni-channel, incident and customer management cloud platform, providing 360-degree visibility of customers and their interactions.
“With Oracle Service Cloud we have significantly reduced our request handling time and our operational costs, introduced detailed key performance indicators to track service levels, and can now provide a seamless, personalized interaction experience to all our 100 million retail customers.” —Mustafa Kemal Çelikkol, After-Sales Services Manager, CarrefourSA
Sweet vision, sweeter results.
Tony’s Chocolonely is an ethical chocolate company established by Teun van de Keuken—a Dutch investigative reporter who, appalled at the slavery involved in West African cocoa production, decided there was a better way to make chocolate. Hence Tony’s Chocolonely—100 percent slave-free chocolate.
Tony’s Chocolonely was a midsize business exhibiting 50 percent year-on-year growth. But the company’s supply chain and IT systems weren’t always able to keep up with this rapid expansion.
The business adopted Oracle Planning and Budgeting Cloud Service for a more holistic overview of sales data, allowing them to match supply with demand in every country in which they operate.
“I would definitely recommend co-operation with Oracle, because although they are a multinational, they’re able to work closely with midsize companies like ours.” —Frits Snel, Sales Manager, Tony’s Chocolonely
Empowering “the finest toy shop in the world.”
For more than 250 years, Hamleys has laid claim to the title “the finest toy shop in the world.” But when the time came to upgrade their EPOS solution, they were spoiled by choice.
Hamleys was under pressure: to find a solution that was equal to or better than their current EPOS solution, to find a solution capable of improving customer and sales associate experiences, to introduce new payment methods, and to deliver this new solution on time—before Christmas.
With Oracle’s help, Hamleys achieved all that and more—completing rollout by November 18, enabling contactless payment, and delivering hyper-care support during Christmas and peak retail periods.
“Through a group of highly motivated people, we achieved the delivery of Hamleys’ new EPOS system.” —David Oakley, Head of Information Technology, Hamleys
Discover how Oracle became Hamleys’ catalyst for change.
Estimated reading time: 5 minutes
Retail Opportunity and the Hyperconnected Consumer
The one trait that sets human beings apart—the trait that allowed us to transform the planet with our societies and our infrastructure—is our remarkable adaptability. It’s enabled consumers to embrace groundbreaking new technologies with incredible eagerness. In 1995, less than 1 percent of the world’s population was internet-connected. Today, it’s greater than 40 percent.
By 2020, it’s predicted that there will be 6.1 billion smartphones in circulation globally. And with the Internet of Things (IoT) taking off, the total number of connected devices is expected to reach 20–30 billion worldwide in the same time frame.
The hyperconnected consumer.
Today’s consumers are hyperconnected. The smartphone revolution has put unprecedented power and information in the palms of their hands, and their expectations have grown accordingly. Modern consumers expect mass personalisation, speed-of-thought commerce, and a blending of physical and digital retail experiences. If they don’t get what they want, they’ll simply go elsewhere.
The hyperconnected consumer is increasingly fickle, and brand loyalty is diminishing—yet consumers care more about the provenance of what they’re buying, and the sustainability of who’s producing it. The hyperconnected consumer can connect with brands from farm to fork, and expects both transparency and honesty throughout the brand relationship.
Capturing the loyalty of the hyperconnected consumer means delivering the personalised experiences they’ve come to expect. Increasingly, the customer experience—whether preshop, shop, or postshop—is as important as, or perhaps more important than, the product itself.
Hyperconnected consumers—and the new technologies they depend on—are transforming retailers.
Driving new consumption patterns.
Hyperconnected consumers have an appetite for innovative new consumption patterns—like the as-a-service models pioneered by disruptors such as Netflix, Uber, and Dollar Shave Club—and technology is making such consumption patterns possible. On-demand service models have the potential to disintermediate retailers, giving manufacturers and suppliers direct access to their customers. Retail is no longer seller-dictated, but consumer-defined.
Technology has changed the definition of ownership, delivering instant, disposable gratification. Increasingly, consumers want their products delivered in a way that matches their lifestyle and needs.
End of the supermarket? Big brands sign up for high-tech service that could cut prices by a third.
Transforming the physical store.
Physical stores are closing in droves, but statistics like the above can be misleading. The stores themselves aren’t necessarily disappearing—merely changing in nature. Where there may have been two dozen mom-and-pop stores a generation ago, there might now be a single superstore capable of delivering a retail experience better aligned to the needs of the modern consumer.
And then there are “experiential stores,” where prospective buyers can purchase products in person, or try out new, enriched services. Think of Apple stores—they don’t just serve a traditional retail purpose, but act as a unique opportunity to build stronger brand/customer relationships.
Breaking down the silos between physical and digital.
To deliver the seamless experiences consumers demand, retailers will be expected to go “phygital.” That means demolishing the silos between ecommerce and traditional retail models, and better connecting with consumers across every interaction.
To deliver rich, personalised experiences and enable consumer-centric growth, retailers need cloud services integrated with social, mobile, and analytic capabilities. They need the power to deliver commerce at the speed of thought, and they need to simplify and optimise their businesses for sustainable, profitable growth.
“Shoppers don’t care if they’re in store or online—they expect a seamless experience wherever they shop, and flexibility across channels. Shoppers want to take advantage of in-store technology…they want to combine immediate access to information with their in-store experience.”
—Mindtree: Keeping Pace with Shifting UK Shopper Expectations (2015)
Estimated reading time: 7 minutes
Digital Technologies: Enabler and Disruptor
Retailers are caught in a cycle of constant reinvention and transformation. But innovation for innovation’s sake is no use to anyone. With disruptive new consumption models emerging all the time, retailers must retain perspective and create a technology strategy capable of delivering the relevant experiences consumers expect. To capitalise on the opportunities of digital transformation, retailers must define their purpose, identify new possibilities, and prioritise the opportunities available to them.
Source: IDC FutureScape 2017.
Personalisation and customisation.
Consumers are increasingly looking for personalised, customised experiences—either in terms of product or service. The technology now exists to provide batch-of-one products, and tailored, in-store offers and experiences. Enabled by technologies such as the Internet of Things, blockchain, AI and mobility, data capture, and analysis is at the heart of personalisation.
Consider this passage on the level of personalisation embedded in the latest Apple iPhone:
“Apple’s latest innovations dramatically improve the degree of personalisation that can be embedded in products. Things like customised labels, materials, and supporting information services to enhance consumer value propositions can all be more effectively rolled out, used, and tracked for iterative innovation.”
—Kevin O’Marah, Apple and Personalisation: A Digital Bridge to Consumer Products, Forbes (2017)
Demand and supply chain management.
With the Internet of Things beginning to proliferate, the digital thread now runs through every process, factory, machine, and product. Real-time, sense-and-response, demand and supply chain management has linked the connected consumer, home, product, and store with the broader supply chain. This provides retailers with access to new insights and an opportunity to enable deeper collaboration across the supply chain.
Speed to market.
Digital technologies are slashing time to market. Retailers have an opportunity to become first to market, or at the very least, fast followers—rapidly responding to consumer demands with innovative product offerings.
Disruptive players and technologies.
Disruptive, consumer-centric players like Amazon and Alibaba are redefining retail markets and raising the bar for end-to-end experience. They’re innovating rapidly, acquiring other industry disruptors, and developing new purchase models based on breakthrough technologies.
“Walmart, Costco, and Kroger lost 18.8 billion USD in market capitalisation on Friday (June 16), after Amazon announced it would buy Whole Foods.” —Quartz Index (2017)
Consider also Domino’s Pizza’s recent “order-by-voice” innovation, exploiting the capabilities of Amazon Alexa. Using just a simple voice command, consumers can order a Domino’s delivery simply, intuitively, and the instant they realise they want one. It’s real-time, sense-and-response, demand and supply chain management in action.
The war for talent.
The future of retail—indeed, the present—is technologically driven. With retailers and consumers becoming less distinct, new business and consumption models becoming commonplace, and consumer expectations becoming increasingly demanding, retailers must adapt rapidly, or perish. To thrive in this landscape demands top talent, but individuals with the required skills and experience are in high demand.
To attract, retain, and develop the best talent in this competitive marketplace, players will be forced to innovate and offer attractive workplace environments.
Estimated reading time: 2 minutes
Blurring the Line Between Manufacturer and Retailer
A combination of consumer demands and technological developments is blurring the line between supplier, manufacturer, and retailer—helping to reduce time to market, wastage, and operational expense. They’re causing retailers to completely reimagine the supply chain, moving from a traditional, linear string of processes—source, create, deliver, consume—to a more interconnected, organic approach.
In our new digital world, a rigid supply chain is no longer practical. A retailer’s supply chain needs to be agile, flexible, intelligent, and collaborative—and underpinned by data transparency between retailers, suppliers, and manufacturers.
Source: PLMA, 2017
Value chain disruptors/thought-starters:
Amazon and Alibaba—are vertically integrated logistics providers, not just ecommerce retailers
Bingobox—is the unmanned, automated store being rolled out for 24-hour access
Manufacturers are becoming retailers and retailers are becoming service providers. They’re discovering new opportunities to foster collaboration, increase revenue growth, and get ahead of the competition. And digital is changing the way trading partners manage beyond their singular enterprises—all parties, suppliers, distributors, and retailers must connect to increase efficiency and find mutual success.
Blockchain: Set to revolutionise the value chain? A blockchain is a digitised, distributed ledger that records every transaction across a peer-to-peer network. It’s a true game-changer: reliable, effectively tamper-proof, and secure. It removes the third-party element from digital transactions, underpinning cryptocurrencies like Bitcoin. And because blockchain effectively guarantees data ownership, protects data privacy, and prevents unauthorised duplication, it’s going to enable countless new business models—while disrupting many existing ones.
In retail, change remains continuous—so predicting the next big thing is far from an exact science. Players must improve operational agility and adopt cloud-enabled, consumer-centric data analytics to better forecast where consumers are going if they’re to anticipate the next disruptive influence.“What often starts as a realignment of the business around the customer is leading to the invention of new products and business models. This cascades to changes in organisational structures, required skills, and more.”
—Harvard Business Review: The Ecosystem Equation: Collaboration in the Connected Economy (2016)
Estimated reading time: 2 minutes
Driving Business Growth with New Digital Technologies
Technology gives organisations the chance to use industry disruption as a catalyst for innovation and business growth. Game-changing technologies like chatbots, AI, machine learning, blockchain, IoT, and 3D printing are emerging all the time, putting retailers on the back foot—when’s the right time to invest, and which technologies are worth exploring?
Source: Gartner CSCO Survey, 2017
Chatbots can play the role of a virtual shop floor assistant, guiding consumers through purchase decisions and enhancing the customer experience. Chatbots enabled by AI are a more effective means of answering customer queries than web pages—they’re responsive, intuitive, and quick, and can even help to close sales that might otherwise be missed.
“A time and place will come where more complex questions can be answered by chatbots, but for now they offer an excellent opportunity for retail brands to answer users’ questions quickly, easily, and without needing to fight with a new app, platform, or service.” —Adam Bastock, Chatbots Magazine (2017)
According to Accenture, artificial intelligence will double the economic growth rate of 12 developed countries—including the US, UK, Japan, and Germany—by 2035. Tech entrepreneur Elon Musk, meanwhile, described it as humanity’s “biggest existential threat.” For better or worse, AI promises to disrupt all kinds of industries. AI allows businesses to automate labour-intensive processes through robotics—helping enhance the customer experience, and arming staff with the knowledge to improve performances and outcomes.
Effectively, machine learning involves “training” a computer with vast quantities of data until it “learns” correct responses by identifying patterns in that data. It’s already found its way into consumer technologies—such as Amazon’s Echo and Google’s Home—and it’s revolutionising numerous business processes, too.
The Internet of Things.
The possibilities offered by the Internet of Things can be broken into two distinct parts: products and data. IoT is giving rise to a wealth of new connected products and services—from white goods to central heating systems, cars, cities, assembly lines, and even entire factories. The data generated and captured by IoT will enable the creation of new business models, enhance existing business processes, reduce costs, and offer new value-added services.
“For the first time, [blockchain provides] a way for one internet user to transfer a unique piece of digital property to another internet user…the transfer is guaranteed to be safe and secure, everyone knows that the transfer has taken place, and nobody can challenge the legitimacy of the transfer. The consequences of this breakthrough are hard to overstate.”
—Marc Andreesen, entrepreneur and software engineer, the New York Times: Why Bitcoin Matters (2014)
Virtual reality and augmented reality.
It’s easy to dismiss virtual reality (VR) and augmented reality (AR) as fads, but both technologies are finding a host of new practical applications—from Snapchat filters to the heads-up displays in executive cars to the entertainment industry. The gaming industry alone—already worth more than double the international film industry—will be completely transformed by VR, providing the opportunity to explore entirely new immersive dimensions. As a creative tool, VR could prove just as groundbreakingly disruptive as the moving image.
Early trials of VR in retail show strong promise for the future virtual in-store experience, while AR applications can provide the consumer with new levels of insight and information overlaid on real-world scenarios.
The possibilities afforded by 3D printing are only beginning to be realised. It’s helping to slash time to market, enable rapid, on-demand prototyping and widespread customisation, and greatly enhance the speed and accuracy of manufacturing. While integration issues have hampered early adopters, 3D printing has already disrupted the medical technology, automotive, fashion, and manufacturing industries, and many more are likely to follow.
Tech trends in retail.
no longer react to disruption, but cause it
adopt a fail-fast culture of innovation
develop new ways of designing, creating, and delivering products
connect with consumers through new technologies
embed AI to amplify value across the application portfolio
eliminate the complexity of combining and integrating datasets, and gain new insights with big data and visual analysis
align marketing across every stage of the consumer journey—preshop, shop, and postshop
Estimated reading time: 2 minutes
Cloud Is the Destination
Retail markets are changing rapidly and fundamentally. In an unpredictable future—dictated by transformative technologies, agile competitors, and changing consumer expectations—only the cloud can deliver the scalability, flexibility, cost efficiency, and future-readiness consumer markets demand.
“Oracle Service Cloud enabled us to provide superior customer service, launch better campaigns, and monitor our activities on an integrated omnichannel cloud platform. We have saved time, effort, money, and can focus more on giving parents the support they need for their baby’s nutrition.” —Isabelle Simal, International Customer Service Manager, Nestlé BabyNes (Nestlé S.A.)
It’s imperative that retailers construct a cloud strategy capable of exploiting digital opportunities, enabling new consumption models, meeting the expectations of hyperconnected consumers, and responding proactively to change.
Cloud transformation helps retailers:
transform their technology footprint from on premises to as a service
enable seamless integration of analogue and digital worlds
deliver rich, personalised experiences and real-time insights
improve trading partner collaboration
reduce costs and increase speed to market with simplified IT
In this era of profound change, we’re being forced to re-examine the nature of retail markets themselves. What is a manufacturer? What is a retailer? What is a consumer? No longer will they slot so neatly into individual boxes. With the lines between supplier, manufacturer, and retailer blurring, the new world of retail practically defies description. With the right cloud strategy in place, businesses can prepare for—and thrive in—a challenging, unpredictable future.