Digital Innovation: Helping retailers meet current challenges
By Matt Rochard, Client Director in Retail, O2
As Client Director in Retail at O2, I talk about the future of the sector almost every day with retailers large and small. Whilst there is a lot of uncertainty about what the next few years hold, there is also a shared belief in the need for innovation, and the ways in which technology can help.
Before making substantial investment in technology, however, I believe that there are some key areas that retailers should address first:
1. Getting the infrastructure right
There are some powerful and innovative applications and technologies out there, and they all rely on one thing to make them work – a reliable and effective communications network. No matter how compelling the emerging technology for retail looks, it counts for nothing without the infrastructure to run it effectively.
When I talk with retailers it is increasingly clear that they are looking for an always-connected, future-proof network infrastructure that will exploit the emerging technology. That’s why we created O2 Gateway, our single enterprise grade infrastructure that integrates fixed, mobile and wifi networks into a single platform.
O2 Gateway provides retailers with a platform that is fit for purpose today and that doesn’t hold them back from doing things differently in the future.
2. Frictionless retail
From last year’s PwC Total Retail survey, we understand the importance of empowering and enabling sales staff to provide a better customer experience. Technology can help here, and we have worked with several retailers creating what they refer to as ‘frictionless retail’, where the traditional counter and till is rendered largely irrelevant by knowledgeable and helpful staff equipped with tablets and devices that can capture a sale anywhere in the store. We are following this approach, with expert Gurus in our stores who bring to life the latest tech, showing customers and colleagues what it can do. The increasing use of devices in store moves us closer towards ‘frictionless retail’, but only with the right support will the overall customer experience improve.
3. Understanding your customer
When I talk with retailers they tell me that they have good data about their customers, and that they analyse and learn from it in order to improve the sales or service they offer. In most cases this data is based on transactions that have already taken place, and so any improvements made are by their very nature reactive. I believe the key lies in data and insight that can predict customer behavior and buying patterns, enabling a more forward-looking relationship with consumers.
For example, O2 has invested heavily in Smart Steps, technology that uses anonymized and aggregated data to provide retailers with increased levels of insight into the behaviour and profile of their customers based on demographic data, browsing/ app behaviour and movement patterns.
We also have tools that allow retailers to act on that data in real time which helps us and our and our retail partners to analyse customer loyalty, the effectiveness of marketing campaigns, the impact of a store refurbishment, and so on.
It is this insight into customer buying behaviour and spending habits that has helped us to design our own customer’s experience whenever they step inside an O2 store or visit us online.
4. Why and when to innovate?
I have noticed an increasing number of retailers talking about the need to ‘Innovate or die’. Innovation is certainly key, but I believe that the most successful retailers in the coming years will be the ones who innovate with a purpose: They will decide what sort of retailer they want to be, put the infrastructure in place to achieve it, and then innovate from there. I hear the phrase ‘Digital Transformation’ a lot, but I believe it’s essential to know exactly what you want to transform into before you begin your drive to innovate.
At O2, we are constantly looking to innovate as an organisation, and to improve the experience that we offer to our customers. For example, we have Telefónica’s Wayra programme, an established start-up accelerator, where we invest and work with start-ups who we believe are disruptive and could benefit us and our retail partners.
5. Knowing what it takes
As a retailer ourselves, both online and with 470 stores, 25 million customers and 24 million people registered to use O2 wi-fi, our business is full of specialists who understand your industry. We have a specific retail practice as part of our business channel and are involved in many innovation projects in the retail sector. Above all we love to share our experiences.
So please do get in touch if you have any comments or would like to discuss the issues that you may be facing. You can message me via LinkedIn.