“If you are like me,” admits SAP Global general manager of consumer industries Lori Mitchell-Keller, “you often find yourself standing in front of a mirror in a store. Does this jacket fit? Do these pants look good on me?”
These simple, everyday thoughts have high-tech answers in today’s digital age. Mitchell-Keller says, “What if your clothes could talk to you and tell you whether they will fit? What if your mirror told you whether the colors matched or recommended another cut or color? How would they know? Because your clothes will know your size and style and hairdo. Your shopping history. Other buyers’ ratings. The company you keep. The events and restaurants you visit.”
This is just the beginning of the limitless marketing/sales possibilities that digital technology offers.
How digital technology is transforming retail
A recent survey by the Harvard Business Review revealed digital technology’s effects in several areas, including cloud computing, Big Data, mobile technology, and social channels. The business implications of advancements in these areas are many. They can help companies optimize current operations, and create innovative new business models of their own. Companies can also use digital technology to improve consumer relationships and service. Key elements of these goals are providing exceptional end-to-end customer experiences and getting to market faster and more efficiently.
Digital technology is shaping and responding to changing retail industry behavior in exciting ways. Mitchell-Keller cites research that surveyed a broad range of retail stores. This research supports some interesting and impressive claims. For example, nearly all stores will use digital technology to enhance their customers’ shopping experience. This revolution will occur within the next 5 years.
Making the most of consumer relationships
Leading retailers use digital technology to reach consumers across many channels. Businesses also offer innovative touchpoints to build and extend customer relationships. According to the digital business website i-Scoop, many things go into modern customer networking. “To truly enhance the customer experience in an enterprise-wide and holistic way, several elements, divisions, caveats, processes and technologies” must work together. The i-Scoop article “Digital Transformation” stresses the importance of the customer experience. It calls consumer connectivity “one of the key areas where business meets IT in a transformational perspective.”
Mitchell-Keller cites a national sports retailer that specializes in golf equipment. This company sells products such as smart insoles to help golfers improve their game. These sensors also allow the company a significant amount of marketing leeway. They are working out in the field 24/7, collecting data, predicting the future, and taking action. Data collected by these devices range from rates of wear and tear to geographic areas of strong movement and activity. The sports retailer can use this data to provide targeted marketing offerings. The company is now able to meet the need of every individual customer and connect with customers when and where they need its products the most.
Powering the Internet of Things
These high-tech insoles couldn’t exist without a growing technology called the Internet of Things. The TechTarget Network has this succinct definition of the Internet of Things (IoT): “A system of machines or objects, outfitted with data-collecting technologies so that those objects can communicate with one another.” These technologies register and record information. This information is then applied in data centers to exert control over “just about anything that IoT wants to control.”
The massive amount of information generated by the high-tech insoles would be useless without an active digital core. The purpose of a digital core is to store and organize this information. It also helps users retrieve and analyze it. This may sound like science fiction, but smart digital footwear is possible today with the proper data processing platform. Mitchell-Keller points to processing solutions as a way to reimagine targeted shopper engagement and improve specific business processes and general business models. Technology, such as SAP HANA Cloud Platform, can process incredible amounts of information to “listen” to consumer needs, which helps retailers respond to them directly.
From digital contact to digital sale
A customer will receive an email when his or her shoes have experienced enough wear. This email features a list of potential replacements and special sales offers. The customer will have instant access to online product information and one-on-one consumer support. After reaching a decision, the customer moves through the digital buying process.
Lori Mitchell-Keller gets to the heart of the matter: “Retailers that recognize the potential of digital technology in retail create infinite new opportunities and customer experiences.”