Once the dust had settled from a strong holiday sales season, it was back to reality in the retail sector. For many retail enterprises, that means finding creative ways to counter the elevated risks they face as a result of now all-too-familiar forces like inflation, a persistent labor shortage, cybercrime and ongoing supply chain constraints.
As Forrester’s Brendan Witcher wrote in his retail outlook for 2023, retail organizations aren’t powerless in confronting these forces. Rather, this year presents “new opportunities for incremental revenue, transforming their business models to capture additional market share, and implementing cost-saving innovations for operational survival.”
What’s more, as Witcher notes, a retail organization’s ability to capitalize on those opportunities could well come down to one factor: technology. “The elite among [retailers] will leverage technology that enables their company to quickly reconfigure business structures and capabilities to meet future customer and employee needs with adaptivity, creativity, and resilience.”
I see three areas that retailers, using the right technology, can tap for growth, protection and efficiency gains:
OPPORTUNITY #1: Bringing consumers to the metaverse and giving them memorable “phygital” buyer journeys. When a consumer products titan like Nike bets big on the metaverse, as it did with the late 2022 launch of the new SWOOSH virtual community, it’s time to take notice. As big a game-changer as ecommerce has been for the retail sector, the metaverse could be even bigger, giving retailers a massive opportunity to use the virtual world in tandem with the physical world to shape an elevated experience for consumers.
TECH NEEDED TO CAPITALIZE: A network and unified communications platform capable of supporting seamless omnichannel customer journeys, with abundant bandwidth, ubiquitous access, reliable connectivity and intelligent automation to enable technologies like augmented and virtual reality. While the metaverse is still in its infancy, it’s time retailers started getting comfortable offering the kinds of “phygital” journeys that consumers increasingly expect, where they can move effortlessly between digital and physical channels as they explore products and the brand associated with them.
To do so, they’ll need seamless and instant access to information in-store, on the road or in their living room. It’s also critical that retailers have the ability to deliver offers, incentives and other content to consumers at the right moment in real time to consumers throughout their CX journeys, whether those are virtual or in-person.
As consumers gain exposure to technologies like AR and VR, they’re going to expect a more enhanced shopping experience. In the near future, that may look like kiosks where consumers don a headset to check out and purchase products, allowing them to leave the store with these items or have them delivered to their homes.
As shopper expectations and demands grow, the retailer will feel the pressure to improve operational efficiencies. Technologies such as self-checkout, digital shelf tags and inventory management systems are designed to help retailers keep up with demand and drive costs out of their operations.
OPPORTUNITY #2: Stronger cybersecurity to counter the escalating threat of attack. Retailers have become the number one target for cybercriminals and experience more breaches than any other business sector, according to Fortinet. Those that are best equipped to give consumers peace of mind that their data is protected will have an edge in the marketplace, while those with suspect security track records are bound to struggle to maintain market share.
TECH NEEDED TO CAPITALIZE: SASE, SSE or some variation thereof. Having watched brands pay aheavy price for security breaches, retailers are recognizing they no longer can depend on outdated network tech and on-premises solutions to adequately protect against today’s increasingly sophisticated cyber threats. That’s fueling a decisive shift to next-generation security solutions like Secure Access Service Edge (SASE), which integrates SD-WAN (a cloud-based, software-defined wide-area network) and security into a single secure connectivity experience. A 2022 research study published by CIO found that for a vast majority of retailers (98%), convergence of network and security is critical or very important. SASE deploys multiple security layers to form a unified connectivity framework built to intercept, inspect, secure and optimize all traffic across a network.
Beyond SASE, there are other targeted security measures retailers can take to protect their networks, apps and data. One is SSE, short for Security Service Edge, a type of software that employs the same measures as SASE — without the integrated networking component — and can be implemented quickly with various types of networks to protect against many of today’s cyberthreats.
OPPORTUNITY #3: Gaining deeper business intelligence using new data-collection tools and analytics. There’s much insight to glean — about consumer behavior, store operations, employee workflows, the customer and employee and experiences, etc. — from in-store and online activity, behavior and feedback. Instead of relying largely on guesswork to configure a retail space and shape customer and employee experiences, retailers can use fresh, objective, data-derived insight to inform those efforts.
TECH NEEDED TO CAPITALIZE: To glean that insight, retailers first need to be able to gather and organize all the data. To do so, they’ll need connected, IP-enabled sensors, people counters, cameras and other data-gathering technology, along with tools to get in-the-moment feedback from customers and employees. And capabilities like these will need to be connected to a network with analytics capabilities powerful enough to make sense of that data, then act upon it.
The foundation to support all this is a robust local area network (LAN) that’s connected to analytics in the cloud. To connect insight to action, retail organizations also need the real-time communications tools to ensure that insight from the data reaches the right people and teams at the right time, so they can act upon it.
Notice a common thread here?To take advantage of these opportunities, retailers need to understand customer demands. The customer experience is convenience-driven and founded in an agile tech stack that can support rapid evolution. Ubiquitous access, robust connectivity and comprehensive security create a core foundation that enables retailers to engage consumers with cloud-based applications that are designed to interact with consumers in real time.
Retailers that can efficiently meet these requirements will remain ahead of the competition and create an experience that consumers will come back to when it’s time for them to search, swipe, click and buy.
Tom Napoli is Senior Director for Retail Vertical Solutions at Windstream Enterprise, a software company that offers managed networking, security and communications solutions and high-capacity bandwidth and transport services to businesses across the U.S.