In our always-on world, consumer expectations in retail have skyrocketed. Consumers can search for a product, read the reviews, and have it in their hands within hours, so shopping at a physical store can often seem unnecessary.
Fortunately, technology exists that can enhance the customer experience and make physical stores attractive destinations. In-store automation can help consumers get in and out of a shop quickly, discover new and exciting products, and enhance interactions with sales associates; it can also help traditional retailers stay relevant and ensure they are not driven into insignificance by digital natives.
While automation brings benefits to both consumers and retailers, it must be implemented strategically in order to reap maximum rewards. Capgemini recently surveyed over 5,100 consumers and 500 retail executives in order to understand these changes and challenges. Here are the five critical success factors to implement technology solutions in bricks and mortar stores.
Put the customer at the heart of your strategy
Our research found that only 35% of retailers consider “solving customer pain points” as the important criteria when deciding how to use automation in-store. However, we know that to successfully scale initiatives, winning customer trust and confidence is key.
Retailers must research customers’ needs and incorporate those insights into their automation strategy and understand that while there are global trends there are also many local nuances to consider as well. Setting out how automation solutions will meet your customers’ needs is vital to getting them on-board. For retailers to stand the best chance of success long-term, identifying the customer problem first, before rolling out the initiative is the essential first step.
Create a data-driven approach
Automation initiatives must be monitored continuously to understand consumer and employee views. Identifying what worked well and what did not when consumers interacted with automation technology is critical to iterating and improving on the experience next time.
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Retailers that are able to use data to understand customer behaviour are better able to tailor prices, products and experiences, leading to improved engagement. Data security and privacy are also key, with GDPR in place in Europe and with countries like the US and Brazil close to implementing privacy laws. Retailers must ensure that the consumer data collected and processed through in-store automation is in accordance with local privacy laws.
Identify a centralised automation owner and strategy
Automation initiatives in retail stores need to draw on the experience of teams across many different functions within a business, but should have a single owner; not assigning the right roles and responsibilities could put the brakes on innovation. Depending on what internal resources they have to develop automation solutions in-house, retailers need to evaluate whether to make or buy solutions. We expect to increasingly see collaboration with a technology ecosystem to ideate, innovate, and identify the right set of automation initiatives for retailers.
This can be very important in a complex industry value chain sharing resources between retailers and technology partners. Of course, automation initiatives cannot only be relevant to the parent organisation – they also need to be compatible with the retailer’s suppliers, payment, and delivery partners.
Instil agile working methods and prepare the technology base
Once pilots have been identified and launched, the big challenge is to drive implementation at scale. Enterprise-level agility is vital to achieve this, as scaled deployment requires an environment that fosters flexibility and collaboration across functions. Strong leadership, clear governance, and robust infrastructure – all components of enterprise agility – are critical. It is also important for retailers to develop an operating model that supports the integration of automation technology within the existing technology landscape.
Look after the employee
Our research found that just 45% of retailers say they are able to train store employees to work effectively in an increasingly automated environment. For example, retailers might be training employees on the uses of automation technologies, but not what to do when the technology breaks down, or not training employees on how to engage with customers in the new ways of interacting that automation can bring, such as through an experience or relationship-based interaction. Without that familiarity, disengagement or resistance could be the result. Change management to encourage employee acceptance might be required in addition to basic user training. It is also important for retailers to put a plan in place for impacted employees, such as reskilling initiatives.
Automation offers exciting potential in retail – reduced costs, making employees more productive, and improving the customer experience. Consumers see automation as a way to improve the in-store experience, helping to solve the challenges they encounter when they shop, and they are willing to reward retailers when they have a positive automation experience.
To accelerate progress, and scale in-store automation, the above five success factors are critical. Retailers need to prioritize automation as a strategic imperative, view automation through consumers’ eyes, harvest and learn from data, build an automation operating model, and secure employees’ buy-in through training and reskilling. Without these success factors, automation will simply be a marginal technology for retail, rather than the game-changer it has the potential to be.