Author: Abhijeet Vijayvergia, VP-India and South-East Asia, Capillary Technologies.
My previous post addressed the present landscape, target markets point of view, webrooming, showrooming, marketplace and single brand eCommerce related omnichannel retail trend in 2016.
In this post, I would be mainly addressing the major missing piece of the puzzle – the technology challenges and digital trends that have affected the omnichannel retail trends in India in 2016.
Technology challenges continue to derail the omnichannel retail adoption rates
Providing omnichannel customer experience has become a critical factor to differentiate brands. Effective omnichannel strategies are those that can accurately and effectively integrate in-store, online and mobile sales channels to deliver a hassle-free buying experience. Apart from revenue growth and ROI, factors such as increased customer satisfaction, net promoter scores, customer loyalty, and brand perception are also regarded as key factors to attract new prospects and maintain a large customer base. Technology investment and setting right processes are critical to enable the complete omnichannel customer experience.
In case of omnichannel solutions, technology investments are majorly needed to provide product and inventory visibility, personalize customer experience, and to enable retail stores and local fulfillment centers with pick & carry or pack & ship capabilities. But in order to realize the complete benefits from omnichannel initiatives, retailers must consider their capabilities and the challenges to seamlessly integrate systems such as CRM, POS, order management (OMS) and eCommerce platforms into all of their channels.
The below framework can act as a starting point to assess and establish a robust technology assessment and implementation process:-
To comprehensively enable and enhance omnichannel retail solution, retailers would first need to capture the complete product information. The products that are listed should relate to the information that customers are searching for. Omnichannel success requires an underlying platform to manage or facilitate such systems and changes that relate to customers preferences and purchase patterns. This is where the selecting the right real-time CRM platform comes in to picture.
Unifying disparate online and offline/store systems and applications is also a continuous challenge. Organizations with multiple databases will need to implement a data governance strategy such as Master Data Management (MDM) and integrate CRM with ERP to support inquiries such as inventory availability, goods in transit and customer transaction history. Data governance measures can also help in streamlining views of the customer by consolidating and standardizing customer data, eliminating duplicate data and by preventing invalid data from being captured at the data entry sources.
The omnichannel strategy also incorporates how retail performance metrics are calculated. Top retail metrics that typically need to be measured include bill/transaction value, total number of transactions, average basket size, customer share, RFM (recency, frequency, and monetary value) and CLV (customer lifetime value).
Ideally, analytics can help retailers deliver consistent customer experiences by gauging consumers’ desire to engage with their favorite brands or products over the channel that is most convenient to them at any given point in time. Analytics and loyalty solutions can offer numerous insights including
- Who are the most loyal customers and how frequently do they buy?
- Which products have the customers viewed online before they walked into a specific store location?
The appropriate use of analytics can also keep customers engaged at individual touch points and maintain customer conversations across different channels. This includes gathering data and insights to identify
- How can retailers encourage their high-value customers to purchase more often?
- What products should retailers personalize and offer to a specific customer to increase his/her basket size?
Retailers who best acquire and analyze Omnichannel data, use analytics to interpret customer preferences and act upon this data by personalizing campaigns will have a distinct advantage.
Once we have gathered the relevant customer data it’s important to convert this data into actionable insights to identify buyer purchase patterns, loyalty program behaviors, social media preferences, buyer persona details and more – in order to deliver relevant and personalized offers. This data-rich customer profiling results in enhancing customer engagement initiatives that facilitate revenue goals such as higher campaign conversions and increased customer lifetime value (CLV). This is where gaining a single view of the customer can help marketers design relevant campaigns, analyze customer journeys and enhance the overall consumer experience.
Training store associates have also become a major concern for retailers since store associates are expected to become product owners and personalize the customer experience.
In-store Clienteling – a customer-centric single view screen available on a tablet or smartphone can empower the sales associate gain complete visibility across the customer data to provide a personalized shopping experience that can drive repeat visits.
Deliver and Promote
Consumers now expect offers and promotions not just based on who they are but also on how they communicate. It’s important to deliver branding and messaging with personalized offers or promotions across the most relevant channels that is optimized towards a customer’s communication preferences.
For this reason, retailers would need certain marketing platforms integrated to the CRM or analytics software that can help convert online research to in-store purchases, permit consumers to manage their loyalty program from any device (mobile or online or in-store) and that can facilitate simultaneous promotions across multiple channels— ie on the eCommerce site, the mobile app or through SMS or across the physical stores.
How Omnichannel Technology has to be Driven by Assessing the Mindset of Indian Consumers
To enable technology advancements, retailers would need to shift their focus to meet the needs of consumers anywhere, anytime, and however, they want. Over time with smart omnichannel retailing strategy, one channel can drive another and retailers can set channel-agnostic revenue goals.
Another potential benefit of a well-defined omnichannel strategy is to drive customers to shop in physical stores. Despite the predictions of the demise of brick-and-mortar stores, many research studies continue to show that consumers still prefer the experience of purchasing merchandise within the store. Many consumers also prefer in-store pickup to avoid online shipping costs; while some customers suggest that they find it convenient to pick items from a store rather than having them shipped to their homes. This trend clearly indicates that online channels can be designed to get consumers into the stores. This is the reason why some of the online-only stores are planning to set up their physical stores across India.
Although the retail landscape in India is presently at the crossroads of a digital transformation and the future seems optimistic, many retailers lack clear KPIs to track their omnichannel initiatives. Not all initiatives can be measured using the revenue and operating margins metrics. Retailers must consider dividing their KPIs into separate categories revolving not just around gross margins but also around their marketing goals, customer engagement, and experience strategies, operational efficiency initiatives and around supply chain/fulfillment capabilities.
Overall, in order to successfully implement the omnichannel retail strategy, retailers would need to analyze the insights from good quality customer data, assess the technological and business impact of their strategies and allocate the right mix of roles and responsibilities to their internal and external resources.
But, presently driving an omnichannel technology enablement initiative still remains a huge challenge for Indian retailers.
I have deliberately not addressed the demonetization issue in this post as we still do not have adequate data to assess the demonetization impact on organized retail. But I promise I would soon address the payment related issues that have taken the entire country by storm in my upcoming blogs.
Do share your thoughts, opinions, and ideas on the technology capabilities and challenges that were discussed in this article.
The global SaaS market has never been this exciting! A recent report by Google-Accel on the SaaS industry pegs the global opportunity to be at $132 Billion by 2020! The primary driving factors are SMB driven demand, vertical-led solutions leading to more adoption, faster time to market in an agile world and a shift of IT spend from Capex to Opex models. Here is the primary split of Enterprise v/s SMB Segment split of the global opportunity. The current opportunity split is tilted towards enterprise segment (65%) and the same will contribute to 44% of the opportunity by 2020. The key driver is SMBs are adopting SaaS products in a massive way!
While US looks to be an obvious first choice for any SaaS product, emerging markets (Asia, Middle East, Latin America) seem to offer far more lucrative options for the following reasons:-
- Companies (including enterprises) haven’t adopted legacy softwares (compared to other markets), SaaS’s effective models can easily find patrons in a less competitive environment.
- The SaaS pricing models are a perfect fit for upcoming markets.
- Costs of sale (even if it is high touch) are economical
According to the iSpirit Survey (the Indian Software Product Industry Round table), About 84% of the Indian SaaS companies look at global expansion as a key business focus. Whereas 13% said they might look at it in the near future. However, only 3% said global expansion is not all a priority.
Here are 5 things SaaS companies should look at before going global. I will touch open 5 different key aspects going global – having a right product, a scalable lead generation engine, right team, focused sales strategy and execution plan and the last one about a simple game plan to get started:-
- Have multiple, scalable lead sources
Before you go after the global market, it is important to set up a lead generation engine, which can be scaled globally based on ambitions. There are some key things you can do
- Setting up inside sales/sales dev. teams: Set up an inside sales/sales development team who nurture and develop accounts with targeted, personalized emails. They can help set up meetings for the sales team. A lead nurture engine with a inside sales team in sync with each other can work absolute magic!
- Blow your horn in the right places: Apply for awards in your target markets and take them seriously – Enterprise sales is about trust building and these awards can help you get meetings with prospects in the region.
- Physical events still works!: When you have a few referenceable logos, organize breakfast events with prospectives to accelerate your pipeline. These meet and greets can break the ice and help you get an ally inside the target organization.
- Focused sales strategy: Relentless sales operations.True potential is unleashed when a great sales strategy meets relentless execution.
- Focus and quality trump quantity: It is important to focus sales reps on balancing new meetings/pipeline building with continued follow-ups on existing prospects. Limiting the number of new meetings per week/month helps drive focus on follow-up meetings so that no deal slips through the cracks.
- A repeatable, inherently scalable pricing model: A broad understanding of pricing should be established across the sales team to create a repeatable process. This ensures that customers pay for the value they derive. Deal-by-deal pricing is not a feasible path to scale.
- Qualify, qualify and… qualify: Deal qualification using the proven lead qualification models – this can help qualify which deals are on the path to closure vs. which deals will not close and should be abandoned. It helps focus sales rep energy on the right accounts.
- Have an A-team for Launch: Building a fine mix of local talent and home grown talent is a great combo for the an A-team who can do the launch. Right from day 1, it’s essential to have sales champions in the launch team.
- Globally scalable, locally relevant product: The best way to get use cases for your new region is to work closely with selected, prospects to co-innovate and build specific use cases for the region. However, if you have to customize your product extensively for each customer, this is going to be a scalability killer. Each customer should have similar use case and similar implementation for true product-market fit.
- The global sojourn starts from your customer list: A critical beginning for the global sojourn is tapping on global customers whom you have acquired locally. The land-and-expand approach works well for SaaS and successful companies gain up to 40-50% of revenue addition from existing customers. This critical piece is often missed. It is critical to have a dedicated account management team which is focused on customer onboarding, go-live and customer wins. They should also be incentivized to drive account renewals, upsells and cross-sells through a formal program with targets.
“I want us to stop talking about digital and physical retail as if they’re two separate things. The customer doesn’t think of it that way, and we can’t either,”– Doug McMillon, CEO Walmart. This quote clearly sums up the way ahead for omnichannel retail in India. Omnichannel has been the buzzword in the Indian retail world for quite some time now but omnichannel remains largely uncomprehended or misunderstood by the retail industry in India.
The bigger question remains if it’s the right time for the Indian retailers and consumer goods companies to adopt omnichannel strategies and implement them on a large scale to see their ROI results unfold?
Let us explore some facets about omnichannel retailing and the factors that can majorly impact the omnichannel retail trends in India.
Omnichannel Retail can mean many of the following things:-
Retailers would first need to first prioritize and address the categories that majorly affect their ROI, volume of transactions and the repeat purchase potential before implementing specific omnichannel retail strategies. For example, brands such as Big Bazaar and Landmark group that have major in-store presence compared to an online presence can prioritize their marketing and merchandising needs over their customer service needs in their overall omnichannel retail strategy road-map. Contrarily, major marketplace brands would need to first focus on their fulfillment, customer service and marketing needs before diverging into other areas in their omnichannel strategy road map.
The present retail landscape in India
It is a well-known fact that India is the world’s second largest consumer market and Indian retail industry is rapidly modernizing. According to multiple sources, India’s retail industry is expected to grow from $600 billion in 2015 to $1 trillion by 2020.
The digital channels are growing its roots in India at an unprecedented pace. India is the fastest growing e-commerce market in Asia with a CAGR of 44% compared to the overall average CAGR of 28%.
As far as online and smartphone adoption is concerned according to Forrester’s Asia Pacific Online Retail Forecast, 2014 to 2019, India will have 125 million online buyers by the end of 2019. Forrester expects mobile to overtake PCs in 2016 in terms of sales and reach $19 billion by 2019. Furthermore, in India we can expect the web to influence $70Bn of retail sales in 2019 which accounts for 30% of the overall organized retail market in India.
Some of the key factors driving the retail growth in India include the impact on the overall ROI and operating margins for the retailers, the need to drive the number of transactions/customer, the need to provide superior customer engagement, superior customer experience and the need to drive an integrated view of the customer data across both online and offline channels.
With over 50 million online shoppers in 2015 and with an above average mobile intensity score of 32(on a scale of 100), Indian consumers are definitely redefining what it means to shop in today’s information-driven environment.
Who are the Drivers of Omnichannel Retail in India?
Target Market Point of View
According to various sources, the online sales in India is expected to reach $70Bn by 2019 which would account for nearly 30% of the organized retail sales in India. Majority of these online buyers (nearly 39%) belong to the 25-34 age group as stated by a Forrester report on the composition of the online audience across Asia Pacific. The report also revealed that 37% of the online audience across Asia Pacific were in the age group between 15-24. This data clearly indicates the need for Indian retailers to target the Gen Y and the millennials to drive their online store sales.
The Indian Consumer Behavior is digitally evolving
The consumer behavior landscape in India is also changing dramatically. According to Forrester Research’s Indian Co
nsumer Techno graphics Survey 2016, nearly 29% of the surveyed retail consumers stated that they buy or order product/services online at least once a month and nearly 22% of the surveyed consumers buy products on a weekly basis. Implementing an omnichannel retail strategy seems like the step in the right direction for Indian retailers to leverage this major psychological shift in mindset of an Indian consumer.
Source: Forrester Research Consumer Techno graphics Survey 2016
Are we addressing webrooming, showrooming and the Marketplace v/s single brand eCommerce concerns?
Retailers have started to track popular marketplace vs single brand retailing trends to make critical decisions about adopting the right mix omnichannel retail strategies for their brands.
They are also aware of the impact of prevailing showrooming and web rooming trends in order to not lose out on their in-store or online sales due to pricing or customer experiences issues.
Source: Forrester Research Consumer Techno graphics Survey
Well, I know we have discussed about several aspects on the state of omnichannel retail in India. But I am not done yet. In the next set of sections, I would reflect upon the technology challenges and about the different payment trends in India.
Learn more interesting facts and insights on “The state of omnichannel retail in India in 2016” by downloading our info-graphic. Click on the link to access the info-graphic : http://bit.ly/2fjB4Qp
With the onset of Diwali around the corner, as a retailer, we assume you might have prepared your best to make the most of the festival sale season.
Customers expect good variety and discounts, but what truly gets their attention is when retailers exceed their expectations through personalized orders and precise deliveries.
It’s worth an effort to review last year’s performance and identify new ways to get organized that can yield maximum revenues from one of the biggest Indian festivals of the year:
Diwali Omnichannel Promotions Pre-Planning
- Product Performance: Check on the product categories and promotional strategies that performed the best last year.
- Compile a list of marketing campaigns and creatives to help expedite the process of launching campaigns.
- System testing: it’s not too late to run load tests on your eCommerce websites to check if your systems have the capacity to handle heavy volumes of sales traffic.
- Optimize System Performance: based on the outcome of your load tests, you can add additional capacity and/or increase the speed of your website with the support of additional hardware vendors or through a scalable content delivery network (CDN).
Tip: Decreasing the size of the images of the products on your eCommerce site to improve its performance.
- Product recommendation strategy: Diwali is also one of the best times to promote personalized loyalty coupons. Check the customer’s preferences, buying behavior, color-design-brand preferences, to plan for daily/weekly recommendation updates.
- Inventory readiness: Double check your product inventory systems and the inventory availability against the sales forecast. If necessary, create a backup plan for items that are at the risk of being sold out.
- Skim Your Competitors Strategy: Although out-rightly aping your competitors’ campaigns and promotions may not yield the same results, being aware of the different types of promotional offers run by the competitors can help you implement few creative quick fix sales strategies.
- Digital asset readiness: Ensure to plan the design and content of your emails, landing pages, and online ads on a weekly or daily basis. Don’t forget to personalize the mailers based on the target segment to make it highly relevant for the visitors.
Collaborate and Deliver
- Meet up: Schedule daily cross-functional team meetings throughout the Diwali season.
- Adhere to shipping threshold times: Ensure to create a centralized calendar that includes shipping cutoff times and guaranteed delivery dates.
- Take note of the complaints received: with respect to shipping or delivery issues and record the resolutions or solutions in a centralized repository that needs to be shared with the customer support team.
- Monitor your inventory: in real time to ensure that you have enough time to match promotional and marketing campaign schedules.
- Measure and Improve: Monitor product placement, pricing, response to the marketing promotions on a daily basis and make adjustments to maximize revenues and profitability.
Apart from sales data, it helps to keep a daily tab of the following data:-
- The best-selling products in various product categories
- Stores Sales across different regions at store and regional levels
- The number of customers that frequently buy from your retail stores
- The number of customers that frequently buy from your e-shops
- The customer’s journey from online to in-store
- The daily/weekly ROI on Diwali marketing $$ spend for campaigns, promotions, merchandising etc.
Rush Hour Sales Quick Fixes
- Capitalize on Diwali sales to increase your fans/followers/re-tweet numbers by offering discounts/freebies by requesting visitors to encourage checking in to your retail stores and request them to review the store experience.
- Find queue busters. You can also put few kiosks and tablets across your high traffic stores to enable customers to purchase items without making them wait in line.
- Ensure to install boards and placards across the store where you can share information and direction on which aisle or on what shelves the respective products are located.
- Don’t forget to publicize or advertise the events and loyalty programs as part of your in-store promotions.
- Promote gift cards and declare in-store product bundling coupons to make great last-minute Diwali sales.
Don’t Lose Sight of the After Sale Issues and Queries
Expect to see a number of returns/issues/ queries either during or immediately after the Diwali dhamaka sale rush. Although many brands don’t offer an exchange or returns on sale item but depending on the size of your retail store, consider allocating a specific area to address the issues related to the Diwali sale items.
Once the Diwali rush is over you’ll have time to catch your breath but that feeling may just be momentary. Then, it is time to start preparing for the big Christmas and New Year holiday shopping season all over again!
Remember when marketers ran newspaper ads with discount coupons to encourage outlet visits? Customers had to cut and fill the coupon and present it at the billing counter. Such tedious tactics seem outdated in today’s digital world in order to influence pre purchase customer decisions. Retailers now have the privilege of personalizing coupons based on individual customer preferences by analyzing all the relevant data captured through the customer’s buying patterns and purchase history. Each customer can then be targeted with personalized offers and recommendations based on specific insights.
Advanced technologies can aid Retailers Identify Customer Buying Behavior Patterns and Preferences
To target a customer with tailored offers, he or she must have a unique identifier – a mobile phone is the obvious choice, given its ubiquitous nature. Retailers are now turning to facial recognition technology and AI-powered footfall counters. These intelligent technologies also help retailers study their customers’ likes, dislikes and navigation patterns around the store, and enables them to offer superior personalized experiences.
Retailers are also using location-based technology to study their customers. Geo-targeting technology can help brands target its customers based on their location – for instance messages about a sale in a particular locality can be pushed to customers’ mobile phones. Within a certain virtual marked off radius around the store, the brands can further target customers with short-time discounts using Geo-fencing, which employs GPS technology in a customer’s smartphone to push specific messages to the device. Retailers can also use in-store beacon technology that can communicate with a customer’s smartphone and send out targeted offers. Beacons can also be used to personalize the shopping experience for its customers. While these technologies help retailers reinvent the shopping experience, there is a flip side to such advancements. These technologies will work only after the customer takes specific action – i.e the customer needs to download the store’s mobile app, keep it active, and ensure that the bluetooth or GPS is turned on. There is always an inherent risk of annoying customers or losing their interest by asking them to take a concerted effort to avail offers or coupons. The need of the hour is to adopt a non-intrusive method that eliminates the above mentioned pitfalls and helps influence customer behavior in a subtle manner, by enabling the retailer to initiate a customer-oriented action.
For retailers, customer retention has always been a big challenge, especially when it comes to influencing pre-purchasing behavior and gathering customer data without asking the customer to carry out certain set of tasks. So how can you determine a non-intrusive method to engage with your customers? The answer lies in adopting new-age technology initiatives and big data capabilities that have the power to indirectly influence the customer’s pre-purchase buying behavior. Stay tuned to our product and blog updates to learn more on how you can positively influence pre-purchase consumer behavior patterns by avoiding any annoying and intrusive techniques.
The retail industry is going through a dramatic revolution with an unprecedented impact of tech-savvy customers indulging in one-click purchases. From checking online reviews for products to comparing prices on different websites, consumers have multiple options at bay to keep retailers on their toes.
Two principal phenomena that are defining the retail ecosystem today are ‘Showrooming’ – a practice of browsing products in-store but actually purchasing them online and ‘Webrooming’ – where shoppers research for products online but eventually purchase them offline in physical stores.
Retailers across the world are facing a challenge of leaking revenue owing to either one of the above phenomena. But can leveraging both trends be a win-win situation for all the parties involved?
Embrace Interchanging Retail Trends
According to an independent study, 46% consumers showroom while 69% webroom. Also, a Forrester Research study predicts that web rooming will result in $1.8 trillion in sales by 2017. These stats show that while consumers want to avail the benefits of online shopping (convenience, discounts), they still crave for an in-store retail experience, either due to the look and feel factor or due to sizing and personal preferences issue.
One common attribute that stands out is the consumer’s need for a seamless shopping experience –with respect to both the channel and the platform. This observation proves the fact that retailers need to be present across different channels (in-store, mobile, social, web) and improve their customer engagement strategy to provide consistent shopping experiences.
Omnichannel Customer Engagement is Key
Online shopping has taken on a new dimension with the emergence of mobile platforms that offer a user-friendly, intuitive shopping interface. In this context, showrooming and webrooming are becoming more relevant than ever before. According to another Forrester Research study, smartphone and tablet commerce will reach $293 billion in sales by 2018. Smart retailers should realize what can attract and retain mobile-shoppers – from detailed product descriptions, customer reviews, and product availability information to easy price comparisons.
Brands can enhance their store experience with exclusive apps for in-store shoppers or by synchronizing mobile payments and mobile loyalty programs. Having well-trained staff with knowledge of multi-channel inventory or a user-friendly website with a strong e-commerce engine will also help influence consumer purchase decisions.
Implementing an omnichannel approach is the best way to stay ahead of the curve to handle these new changes and trends in retail value chain. It’s all about providing shoppers with one digital channel that runs across multiple platforms to ensure an enhanced retail experience. Technology is a great enabler to balance out both showrooming and webrooming trends. Retailers need to step up and implement the right technology measures to cater to their customers’ shopping expectations and offer superior, enriching experience across all platforms and channels.
Strategies for improving customer experience using your marketing big data
March 5th 2:00PM SGT/ 11:30AM IST
Great brands don’t just market themselves, they build genuine loyalty. When brands engage with customers across their preferred channels, customers build a relationship, make more purchases and become their lifelong fans. By harmonizing all the data a company collects, brands can learn exactly what their customers want to know from them, when they want it and what channel they prefer to hear it from. Big data is fueling the future of retail, and you need to make sure you’re all fuelled up!
In this Webinar, you will learn;
- The best practices of retail brands across the world.
- How to build a great omnichannel customer experiences
- How to build a profitable engagement through automated personalized recommendations
- The Do’s and Don’ts of efficient customer service
We’ve got a great speaker lined up in Capillary’s Vice President of Professional Services, Govind Seshadri. Govind heads Analytics, Systems Integrations, Managed Services and Technical Support functions at Capillary and brings over 20 years of IT and consulting experience. He is a published author with Cambridge Press and has held leadership roles at Cognizant, Sun Microsystems/SeeBeyond and StoreRunner Network.
Govind plans to address many of the “Top Asks” we’ve received from retailers:-
- Data Collection and Enrichment
- Data hygiene, Brand syndicates, Merging identification
- Big Data Analytics
- Mostly descriptive with segmentation and attribution; moving to predictive
- Simplified Retail Processes
- Close of day operation, Merchandising
- Personalized Campaigns
- Brand building, Bounce-back, Acquisition
- Building Loyalty
- Increase redemption rate, Gamification, Countering “Showrooming”
- Intelligent recommendations
- Customer Complaints and Feedback
- CSAT, Surveys, Social sentiments
Join us on Thursday, March 5th, 2015 to learn the must-knows in creating an efficient omni-channel customer experience using Big Data.
Can’t wait untill March 5th? Want to learn more about Capillary’s Intelligent Customer Engagement™ suite?