A renaissance in retail

by Daemonite Hannah Green

We’re having a renaissance in the way retailers sell, customers spend and suppliers supply. The days of a trip to the high street with cash burning a hole in a pocket and there being a straightforward chain of supply are gone. Click and collect, return to store — any store, return via courier or third party retailer are with us. Buy anywhere, supply anywhere, return anywhere.

The single straight path from source to sell is now a labyrinth with multiple points of entry and departure for all players in the retail world. It’s a mesh of interactions. Customers want to buy online instore or any other way and return if needed via any other method. This creates a web of complexity which is not only difficult to understand and express as a flow diagram but also hard to manage, make profitable and innovative.

Back in the renaissance days the leading thinkers could hold a sizeable amount of the knowledge of the world in their heads. The world got more complex and specialists joined up with good communications to give us new ideas. Supply meshes are now so complex we need to employ machines to help us. Not just as datastores and simple decision trees as has been the case, but now digital systems to learn what is going on in this world of choice and opportunity.

Inventory shortfalls and empty shelves are still a no-no in retailing. If it’s not on the shelf (real or virtual) you can’t sell it and I can’t buy it.

Getting the goods to the customer in a way which gives them the warm glow of receiving excellent service swiftly across a large number of customers needs machine help.

Being able to react to changes in the outside world which put pressure on the mesh to deliver. Social media posts which cause spikes in demand. Events which put an unexpected strain in particular pockets of geography — store locations deliver hubs and couriers. Customers want things faster and with more relevance — they expect added value instantly.

The underlying currency and language of all this is data. A lot of it. I trust the £ do you trust your data? Without that trust you cannot expect a machine to make correct informed, insightful decisions — you wouldn’t expect that of a human.

Less than half (49%) of retail and consumer goods marketers report having a completely unified view of customer data sources

In short, they don’t know who their customers are. A large number of retailers need to do some serious work on getting to grips with identifying customers and cleansing their data.

Data drives intelligence and learning in both the human and machine worlds.

To get actionable and profitable use of all this data you need to use an AI/ML strategy to automate the fast turnaround of logic and maths and express those results in a way that makes your products attractive to your customers. For example, a recommendation engine — a filtering tool that makes use of algorithms and data to recommend the most relevant items to a particular user.

To achieve this requires IT resources to store and crunch the vast amounts of data and publish it across websites and social media. Cloud computing is a catalyst that can accelerate a retailer’s capabilities for everything from website personalisation and loyalty program management to omnichannel order fulfilment and pricing/margin management.