The retail sector has been undergoing rapid digitalisation in the past couple of years. New-age technologies such as artificial intelligence (AI), internet of things (IoT), augmented reality (AR)/virtual reality (VR), cloud and big data are increasingly making inroads into the sector as enterprises are taking concrete measures to provide a more immersive experience to their customers. The ongoing Covid-19 pandemic has further provided a thrust to digital uptake in the sector. As such, the e-commerce market is expanding at an exponential rate. That said, the deployment of these technologies comes with its own set of challenges. Vineet Rao, CEO and CTO, DealShare shares his views on how ICT is transforming the retail sector and the various opportunities/challenges that the Covid-19 crisis is presenting…
What are the key ICT trends shaping the retail industry at present?
The technological calendar of the 21st century will be marked with 2020 as a key year. Technology is the backbone of e-commerce as it not only helps connect sellers and customers but also enables effective management of customer orders, deliveries, returns and payments. In fact, technology plays a crucial role throughout the e-commerce value chain, in areas such as recruitment, marketing and advertising. Some trends that are shaping the e-commerce industry are:
- Digital supply chain: One of the most important differentiating factors for companies in the e-commerce space is on-time delivery. The pandemic has made this sector a new focus area as these platforms are now seeing a spike in demand. In such a scenario, optimising the supply chain management process is critical to ensuring efficient and faster delivery models. Along with this, there are many emerging technological innovations, which will enable other critical supply chain areas such as inventory management (hack-proof RFID chips); brand safeguarding (creating invisible digital markers to help fight counterfeit products); warehouse management (using robot technology and automatic guided vehicles for collaborative automated order picking) and delivery (using drones to deliver shipments).
- Demand-driven forecasting: Companies are increasingly experimenting with processes that can predict a customer’s shopping list and deliver products to their nearest fulfilment centre even before the order is placed. This will save a lot of time and effort of the consumers as they will be free from mundane tasks such as shopping for household essentials and having to travel to markets. Although this technology is still in its experimental stage, it can lead to the possibility of e-commerce becoming as normal as buying from a kirana store. These technologies have the potential to take data analytics to the next level and allow companies to expand their customer base by manyfold, while enhancing customer loyalty to a great degree.
- New payment service: Due to the Covid-19 outbreak and the following trend of social distancing, consumers are using smartphones and wearable-tech for making online payments. With an uptake in contactless payment mediums such as Paytm, GooglePay, PhonePe, security levels have also reached an all-time high. This higher degree of digital security has helped convert even those consumers, who did not prefer online shopping in the past due to security concerns. This is further expected to give a push to cashless payment modes and, in turn, lead to a boost in e-commerce sales.
How are technologies such as AI, IoT, robotics, AR/VR and cloud transforming the sector?
In today’s market, e-commerce company vendors are focusing on providing a superior customer experience. Technology drives a higher degree of personalisation and makes sure that each and every customer is treated as an individual target segment, rather than a part of the generalised community. Also, today AI companies are transforming e-commerce by devising unique solutions for players in this sector. As for an e-commerce business, they would increasingly rely on AI in the coming years, making it one of the most important tools, as it holds the potential for dynamic and adaptable targeting. This will help companies develop the right pitch for the right target audience, at the right time and on the right platform. AI provides personalised solutions by interacting with customers via text and voice messages and is also able to identify and find products based on pictures, thus saving manpower and providing a feasible solution. In the near future, these radical innovations in technology will further blur the boundaries between brick-and-mortar retailers and e-retailers. And a new normal will be where AI-driven personalisation will not only lead to the conversion of one-time transactions but also drive personal and trust-based relationships between consumers and e-retailers that effectively improve customer lifetime value.
Are you deploying any new-age technology at present? How has it helped enhance your business efficiency?
We are employing AI/ML to solve a variety of consumer and efficiency problems. On the customer end, we are trying to solve the most relevant recommendations, personalisation and searches. On the efficiency side, we are deploying technology to improve delivery efficiency by improving location, routing and forecasting demand, stock movements and fraud prevention.
What challenges and opportunities have come to the fore due to the ongoing Covid-19 pandemic?
Surely, Covid-19 has impacted the company as there are surges in orders, disruptions in supply chains and changes in customer behaviour. Moreover, as the Covid-19 outbreak continues, it undoubtedly has an effect on business. In particular, e-commerce is seeing significant impact as the entire country has come under quarantine notifications and consumers have started to shun human contact, while retailers have been scrambling to adapt. Consumers are forced to dramatically change their purchase behaviours. However, companies are putting in all efforts to protect their employees and providing them with essentials to help them avoid the spread of the virus. Therefore, companies have quickly enacted new policies as even after having advancements in technology, it is impossible to have employees working remotely when it comes to e-commerce.
What kind of change has the Covid-19 pandemic brought to your business and marketing strategies? What key emerging trends do you expect in the near future?
We can undoubtedly say that the Covid-19 outbreak has disrupted people’s lives as well as businesses. But one can also agree that disruption has also brought with it growth opportunities and mechanisms to overcome challenges. A few strategies that will work in the near future are:
- Recreating the marketing and sales funnel: Most industries are registering low conversion rates. Therefore, it is a best practice to change your marketing and sales funnel to accommodate this new reality. Hence, one can offer consumers something for free or at a good discount during these difficult economic times. Further, by offering a consistent and high quality product to customers, one can build trust, connect with customers and increase brand awareness.
- Responding to the crisis: Consumers will be more loyal and happier when they see the brand helping them through the Covid-19 pandemic. Therefore, providing some support and help to the affected communities by offering them essentials for free or at a good discount will make sure that the brand leaves a mark and retains its position in their minds.