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GUEST COMMENT The smart way of surviving the high street’s digital transformation

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Businesses across all sectors are currently undergoing a form of digital transformation (DX). By embracing the latest advances in technology, such as artificial intelligence (AI), the cloud, and the Internet of Things (IoT), they can operate faster than ever before, delivering increasingly personalised services to their customers at speeds previously unimagined.

 

The retail sector is no exception. US retail giant Walmart, for example, announced last year that it’s investing in innovative new technology to improve its ecommerce and in-store operations in a bid to attract new customers and keep its biggest competitor, Amazon, at bay.

 

Also facing stiff competition from the internet behemoth, Toys ‘R’ Us was slower to adapt to the recent shift in customer demands. After filing for bankruptcy in September 2017, the company was awarded a loan of more than $2 billion which it swiftly invested in the latest digital technologies, with CEO Dave Brandon claiming that it would be debuting an interactive, augmented reality experience in its stores while ramping up its online presence. Unfortunately, however, it was too little too late, and the company is now in the process of closing its stores on both sides of the Atlantic.

 

Earlier this year, New Look, Maplin and Claire’s Accessories became the latest victims of the growing global retail crisis, and headlines began proclaiming the death of the high street. However, the game isn’t over for bricks and mortar retailers just yet. Instead, the fate of these retailers should serve as another wake-up call to high street brands to embrace digital strategies and prevent losing further ground to online players. It provides proof of the need to capture the increasingly important Generation Z demographic, commonly referred to as “digital natives” to give them and others a retail experience that is truly unique, remarkable and memorable.

 

Not your mother’s shopping

 

The speed of change in business has been dramatic over the last few years, driven by “born in the cloud” applications, breaking new ground and disrupting industries. Traditional businesses must take note of the rapid growth and success of moving to the cloud and cloud-native applications, and strive to transform digitally if they hope to remain relevant in this new era of retail. Capgemini, the multinational business consulting giant, said its researchers last year determined that accelerating moving to the cloud has business benefits, with 84% of those businesses fastest in moving applications to the cloud enjoying increased revenue and reduced operating costs. Almost the same percentage of businesses said they were ahead of their peers when it comes to financial performance. No doubt, the combination of moving apps to the cloud and DevOps processes and culture has fuelled the high-speed chase for the retail shopper.

 

With a core market of teen and pre-teens, the collapse of Claire’s Accessories in the US market demonstrates that the retailer wasn’t able to meet the needs of younger shoppers. Digitally-savvy Generation Z consumers, who have grown up with technology, expect brands to provide a seamless experience across all channels, and a failure to deliver this can prove fatal. As Generation Z’s purchasing power already represents billions of pounds, finding a way to engage this cohort will be crucial to brand success, both now and in the future.

 

While Claire’s has filed for bankruptcy in the US, the company has stated that all of its 378 UK shops are open as it moves forward with restructuring. It’s important, therefore, that the accessories store now steers itself out of further trouble by embracing digital technologies and new business models.

 

In January 2018 it was revealed that it was undertaking a digital transformation by implementing Salesforce Commerce Cloud, following which it saw a 20% increase in checkout completion on mobile devices, suggesting that there may still be hope for the struggling retailer.

 

Smart data and visibility

 

To succeed, Claire’s, and other struggling retailers, must deliver a great retail experience both offline and online.

Customer data can be worth as much to a retailer as a sale if it is translated into an insight that will result in future engagement and conversions. Such insights will also remove the need for guesswork, enabling retailers to be more agile and responsive when it comes to implementing new, lucrative business strategies.

 

Indeed, 92% of respondents to a recent TechValidate survey said digital insights using smart data were needed for an organisation to retain corporate control over service quality and performance. To achieve these insights, an organisation must utilise information that crosses its IT infrastructure – from the edge through to the cloud and data centres – to redefine its operational processes and enhance business performance. It’s impossible to fix what you can’t see, though, so controlling business outcomes must therefore start with pervasive visibility into hybrid environments, both on- and off-premises, across multi-clouds and anywhere along the service delivery path.

 

By having end-to-end visibility of the entire IT environment, and with solutions that deliver real-time insights into service, application, and infrastructure performance, retailers will be able to confidently embrace the new digital innovations they need to deliver a seamless, targeted and, ultimately more satisfactory customer experience online and in-store.

 

Time to change

 

Consumer demands are changing, and it’s clear that retailers must change with them if they are to survive. Digital natives, Generation Z want different things to previous generations of shoppers, and want them delivered in a different way. The combination of cloud with continuous delivery and deployment of applications and services allows retailers the speed and agility they need to keep shoppers happy.

 

But at the same time business risk has increased as a result of additional IT complexity and automation, creating application connectivity sprawl and an explosion of service dependencies. As such, assuring an uncompromised user experience requires removing performance blind spots in the hybrid cloud environment. On one hand, server-centric operations approaches to application performance management are very familiar to DevOps teams, but they can expect non-stop fire-fighting since the tools they use simply can’t keep up with the “hockey stick” increase in hybrid cloud workloads. On the other hand, using a workload-centric monitoring approach with deep hybrid cloud insights through smart data will allow retailers to respond at the pace their customers demand and succeed in an increasingly competitive environment. Without a smart digital strategy in place, it won’t be long before we see other high-profile names follow Toys ‘R’ Us into the retail history books

Author: Ron Lifton, Senior Solutions Manager Enterprise, NETSCOUT

Picture credit: Fotolia

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