Can Retailers Survive in the Age of Amazon?

Retail Survival = Seamless Experiences

One of my favorite omnichannel retail stories is from Tesco in Korea. So when I spoke about changes in the retail world at the Seamless Africa conference a few weeks ago, I put up this picture and talked about it.

Retail innovation: Tesco's virtual subway store in South Korea

Retail innovation: Tesco’s virtual subway store in South Korea

Tesco developed a system where they display store shelves on a subway wall, and tired commuters simply scan the items they want to buy. By the time their commute is over, the items are waiting for them at home.

Brilliant!

Vinod Bidarkoppa, Retail Innovator

Vinod Bidarkoppa, Retail Technology Meets Customer Innovation

The speaker right after me was Vinod Bidarkoppa, Senior Vice President & Group Chief Information and Technology Officer at Future Group in India.

Get your FREE Transcript Now!

Turns out he was the one who developed that program for Tesco!

Naturally, I couldn’t resist snagging him for an interview.

Bidarkoppa has worked as a Chief Information Officer (CIO) at large retailers and airlines, and overseen projects to move from purely bricks and mortar to multichannel or omnichannel.

Here are his thoughts on the changes happening in retail and how to make retailers more customer friendly.

Tesco was one of the early retailers to realize that multichannel was inevitable and make the necessary investments in technology to enable it. Says Vinod, it was “all about bringing tech conveniences to the hands of the customer.

What’s holding retailers back?

Retailers worldwide are watching their traditional store sales erode. They know they have to change, but many aren’t doing so, or aren’t doing it well.

Why?

As we discuss in the interview, there are several factors that have to be in place to make the shift to omnichannel retail successfully:

1. CEO buy-in isn’t enough.

Given the magnitude of the changes required, Board buy-in is also essential.

2. Major technology investments are necessary

Although the cost of technology has dropped a lot in the past few years, it is still an investment. One that involves both significant risk and the likelihood of it being obsolete within five years. Like it or not, that’s the world we now live in. Think of it the same way you would of investing in new stores. It is not just an IT add-on.

3. Silos = death

Customers don’t see the silos; they just see that the organization isn’t working for them. As Vinod put it, “all [customers] want is a super, super experience in a seamless way.

 

4. To end silos you must completely change your metrics.

The behaviors you’ve rewarded in the past are likely to prevent those you need now.

 

Amazon Is Powerful, But You Can Compete

Despite Amazon’s massive growth (it now accounts for approximately half of all online retail sales), the bulk of consumer retail still happens offline.

There’s no doubt that more retail sales will continue to move online, so you cannot ignore that channel. But to survive, retailers also need to completely rethink the store experience.

“Experience” is the key word in that sentence.

Increasingly people will only go to stores for the experience. It had better be one that’s worth their time and travel hassle.

What can you offer to make your in-store experience special?

What is related but unusual to see in a store of your type?

Here are two examples to get you thinking:

  • UK grocer, Waitrose, has in-store wine bars. Friday night without a date now has a new option!
  • Lexus West of Edmonton, Canada, offers a spa in its car dealership. The Lexus brand is about pampering, so the spa is actually a good fit. And it helps attract female buyers, who have traditionally not been treated well by car salespeople.

Have you seen any other cool examples?

Please share in the comments section below (scroll to get to it).
Get your FREE Transcript Now!

Liked this? Get the Frank Ideas Newsletter!
[ View Archives ]
Wowing Customers Doesn't HAVE to be Expensive!
How To Use Data To Fight Crime & Serve Citizens Better
Post was last modified: by

Leave a Reply

Your email address will not be published. Required fields are marked *