Now is the time for retailers to buy into a post-physical, digitally-transformed landscape

By Ali Rezvan, Microsoft UK Retail Executive

Retail is at a turning point.

An online shopping trend that took off with the dot-com boom of the late 1990s and early 2000s and accelerated during the 2008 recession has been fueled again by the pandemic.

The result? Consumers no longer just expect a shopping experience that is fast, personalized and “always on”, they demand one. What was once considered cutting-edge customer service is now the norm. For retailers, this means they must accelerate their digital transformation to meet their customers’ needs or risk becoming obsolete.

digital change

Online shopping has skyrocketed during the pandemic and its associated lockdowns. Since people couldn’t make their way to the high street, they opened retail apps and logged onto websites from the comfort of their couch.

Research shows that people love the convenience of online shopping and how easy the shopping experience is, from personalized recommendations to the ability to see in real time what items are in stock.

The Center for Retail Research found that e-commerce is the fastest growing retail market segment in Europe and North America.. Combined e-commerce sales in Western Europe (UK, Germany, France, Netherlands, Italy and Spain) grew by more than 128% between 2015 and 2020 to £347.65bn.

As pandemic restrictions eased and people returned to retail parks and high streets, they expect the same in-store shopping experience they had online. Retailers used to call this “omnichannel”: providing products to customers in different ways and at different times in their buying process. Today, there is only one channel: the brand itself, providing a unique, always-on, personalized customer experience that flows seamlessly across physical and online retail environments.

That could create problems — and unhappy shoppers — for retailers that don’t have a digital-first approach to their business.

Combined e-commerce sales in Western Europe grew by more than 128% between 2015 and 2020 to £347.65bn.

What does “one channel” look like?

Let’s look at a clothing store as an example. When a fashion-conscious customer walks into a store, he wants two things: items that he knows will fit him well and that are available to purchase immediately. What they don’t want is to wait for those things.

Traditional retailers, with many clothing racks and a limited digital operation that requires staff to go manually and check to see if they have products in stock, will struggle to keep customers happy in this scenario. It takes too long and there is too much uncertainty for the buyer.

The retailers that will thrive as people return to the high street will be those that have an intelligent digital system that enables a constant flow of information pulled from multiple data points, including their e-commerce operation and their physical stores.

Here’s how this might work in an in-store shopping experience: A customer scans their reward card or “checks in” to the store using a digital display. Doing this means that if they need help, store staff have access to recent purchases the customer has made and can also suggest similar items. Customers and staff can see stock levels in real time, and if a product runs out, it can be delivered to that person’s home the same day. This can be done on a Surface device that the employee uses to ensure they can move around the store and offer assistance, rather than being stuck behind a cash register all day.

But don’t worry about the item the customer wants, the store probably has it in stock because the connected digital system is pulling information from multiple sources and has seen that this particular product is very popular in that area and has alerted the manager, who has ordered more to sell in the physical store.

The store has the right products, in the right place, at the right time, creating a faster, easier and more personalized shopping experience for customers.

A cloud-centric approach

This digital system is powered by data and the cloud, with built-in security that offers peace of mind to businesses and their customers: consumers want fast, personalized and reliable shopping experiences, but not if it will put their money or personal information at risk.

Microsoft is providing this digital network to retailers large and small around the world today. Dynamic 365 gives companies an overview of every part of their business; data flows to Microsoft blue cloud and sits in a data lake; powerful artificial intelligence tools can analyze that data and provide insights for company personnel to take action; BizApps can automate some of those tasks, freeing up staff to work on more complex tasks.

The Microsoft Cloud for Retail brings together many of these in a single solution tailored to retailers. It helps companies maximize their data, improve the shopping experience, create real-time and sustainable supply chains, and empower employees.

Along with this technology, retailers need employees with the right skills to implement and run it effectively. Improving staff skills through training and courses is essential, so visit Microsoft Digital Skills Center Learn more.

Digital transformation at the UK’s leading retailer

A company that is doing it right is Fraser Groupwhich owns brands such as Sports Direct, Game Retail and Flannels.

With more than 25,000 employees in 25 countries, it connects its diverse business with a three-pillar strategy around its brands, digital offerings and physical stores. These are supported by a focus on people, systems, automation and data.

Frasers is embracing Microsoft tools and services in the Azure and Modern Work clouds to enable their digital transformation journey. It’s unlocking cutting-edge security through the Microsoft Security portfolio, while retail stores use Microsoft Teams and Surface devices to support communication and collaboration among staff.

It’s a great example of a united business that is using digital tools to unlock new possibilities.

make a connection

When it comes to digital transformation, retailers must consider quality over quantity. Technology is only an asset if it is used to solve real problems within a company. Connect your business with Microsoft Cloud, see your business with Dynamics, understand your business with data and AI tools, and communicate with your business using Equipment.

Connecting your business is the best way to make sure your customer connects with you.

Tags: AI, Azure, Retail Cloud, Dynamic, Microsoft, Retail sale, equipment

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