The future of retail: Is your business organized?

With a number of presentations at Retail Week Live 2017 highlighting how technology is changing the way retailers engage with customers, the question was asked whether businesses are fit for the future.

The Future Laboratory talked about how it has isolated six key behaviors that businesses will need to exemplify in order to prepare for and secure the best possible future. Working with The Effectiveness Partnership it has quantified these and used them to create the Future Fit Index, a ranking of the most popular brands in the UK.

The six behaviours that the ‘Future Fit Index’ measures are:

  • long-term planning.
  • brand stretch.
  • innovation.
  • conscious business.
  • thriving employees.
  • agility.

The top 20 brands are shown below with first place going to Nike, while Google, Microsoft, Jaguar and Land Rover also did well.

Overall, Nike’s top spot demonstrates a brand that is well prepared for changing consumer needs, has an eye on the future happiness of its workforce and its consumer base, is getting more transparent in its sustainability efforts and has the financial fitness to make the future happen.

The way we engage with customers is changing

Google highlighted that it is now seeing 20% of all searches via voice. In the next decade as we move to an AI-first world the search engine believes machine learning will transform every business.

The talk highlighted that these intelligent services need to know about your business to capture traffic, as well as the importance of being in the the Knowledge Graph. This is the knowledge base used by Google to enhance its search engine’s search results with semantic-search information gathered from a wide variety of sources.

AI will apparently know us better than ourselves and companies should think of AI as a gatekeeper to consumers. To capture traffic from intelligent services, leading brands are using Digital Knowledge Management.

Shop Direct CEO Alex Baldock also highlighted his view that in-app conversational interfaces will become very popular with UK consumers. Baldock believes that AI will really enable Shop Direct to transform personalisation, helping to give ever better answers to questions.

Last year the company launched UK retail’s first automated, in-app conversational UI. The Very Assistant talks to customers in their own language, helps solve queries, and check accounts. It is already enabling the business to democratise and speed up customer service, removing the need to queue at a customer service desk or wade through phone systems.

Shop Direct’s vision for AI is huge, with the idea that every one of Very’s customers will have their own personal assistant which learns and brings them what’s right for them before they ask, and deals with queries and issues. Baldock said that AI will transform retail fundamentally.

It is still day one, says Amazon

Technology and the internet are only just beginning to show their potential, said Ajay Kavan, VP of International Special Projects at Amazon, who took the audience through the company’s guiding principles.

1. Customer obsession

The number one reason Amazon exists is down to its customer-focused culture, said Kavan. Amazon tries to start with the customer and work back. Any new initiative starts with a person writing a mock press release and answering questions a customer would ask. Amazon Echo/Alexa started like this based on the idea of the computer in Star Trek.

Amazon was the first retailer to put customer reviews on the website and at the time others thought it was a bad idea. The response from Jeff Bezos had been ‘you make money when you help customers to make better purchase decisions’.

2. Passion for invention

Amazon would never have launched most of its innovations if it had just relied on customer feedback and responses, said Ajay. Employees are encouraged to think big, start with the customer, dive deep into each initiative and organise the business so it can be nimble.

3. Thinking long-term

Putting a focus on long-term innovation horizons has also been key to Amazon’s success. These are the initiatives that can be a real source of competitive advantage, e.g. Prime, Marketplace and Kindle. Kavan highlighted that early ideas for Marketplace didn’t work, but now half of the items ordered from Amazon are from third-party suppliers.

4. Operational excellence

Amazon focuses on root cause analysis. For every initiative it defines the right principles before teams work on them. Then they can work fast and focus on defect reduction. For the past 13 years customer contacts per unit have reduced each year as a result of the core principle of root cause resolution.

So do you feel your organisation is fit for the future?

by Lynette Saunders @ Econsultancy

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