Digital Transformation is Key to Many Retailers Survival
It’s the 21st Century and we've entered a digital era where businesses across every sector are reaping the rewards that connectivity and digital transformation brings them. Operating faster than ever before, industries are harnessing next-generation technologies like the Internet of Things, artificial intelligence and the cloud to accelerate the delivery of digital services to customers.
Well-known multinational companies that were started in the mid-to-late 19th century, like GE and Siemens, are working hard to keep pace with businesses that were born in the digital age. GE for example, is looking to jettison off its locomotive division which it has been developing for over 110 years, and instead is seeking to push more into “digital industrial” ventures.
In retail, we’re seeing big household names such as Wal-Mart investing in digital innovation to survive this era of transformation and compete with online giants like Amazon.com. Gone are the days of the traditional milkman; milk can now be ordered by your fridge, and very soon will be delivered by drone.
Some legacy players, like Toys"R"Us, have been slower to embrace digital trends and haven’t adapted to changes in consumer demands, resulting in a fight for survival against the threat of online titans. Fortunately for the toy store, it has been given a second chance: a loan of over $2 billion granted to it by a judge after filing for bankruptcy protection in mid-September in the U.S. and Canada.
But what can we learn from this, and as we move increasingly towards a data-centric society, how can other retailers ensure they maximize the opportunities presented by digital transformation and reap the rewards of a streamlined, connected strategy?
Gravitate Toward Data
In today’s digital age, data is considered to be more valuable than oil. In terms of retail, customer data is worth as much as the sales themselves if it's translated into an insight which will lead to future engagement and conversions. This will also remove the need for guesswork, and enable retailers to be quick off the mark with implementing new, lucrative business strategies.
From the beginning to the end of a customer’s journey, data can be used to enhance the retail experience. By monitoring application and service performance, retailers can pinpoint the root cause of problems in the IT infrastructure, reducing the number of abandoned shopping carts or preventing slowdowns that can turn consumers off.
The modern-day shopping experience is now split between brick-and-mortar stores, online (including mobile) and across social media platforms. More than one in five of the global population shops online, and each customer has individual preferences as to where they start their journey and where they finish. Therefore, retailers must prioritize operating and assuring services in any IT environment.
This hybrid approach requires visibility, knowledge and speed, and, as any IT professional will testify, you can’t fix what you can’t see. Therefore, controlling business outcomes starts with pervasive visibility into the entire network and anywhere along the service delivery path, which increasingly includes new applications such as video, instant messaging and voice services.
Together with a converged IT infrastructure across physical, virtual and cloud environments, it has become even more important to have a service assurance and security strategy in place. Operating across various systems and complex infrastructures creates opportunities for service degradations and vulnerabilities, which become detrimental to the customer experience and ripe for cyber criminals.
Houston, We Need to Avoid a Problem
When it comes to brand loyalty, the relationship between customer and retailer could be described at best as fragile, thanks to a competitive retail landscape and capricious, time-poor shoppers. However, ensuring a high-quality communication experience will not only enhance existing customer relationships, but also entice new customers, driving revenue and boosting reputation.
Complete visibility is imperative throughout any business, but none more so than a company's contact center. Often the initial and sometimes only touchpoint for customers, the contact center must be a beacon of high-quality communication. Being able to address and resolve any issues quickly and effectively will make or break customer relations.
Smart data, which is distilled from wire data that traverses the IT infrastructure, can be used to clearly understand application performance, infrastructure complexities and service dependencies, giving retailers unprecedented insight into their businesses. In the context of service assurance and security, it provides enterprises with a proactive approach in terms of controlling business outcomes and visibility throughout the entire IT environment that will make a fundamental difference to a retailer looking to ensure the highest quality customer care.
The Digital Transformation Liftoff
Retailers are increasingly discovering that within every action and transaction there's an opportunity to turn wire data into smart data. From this data, they can glean informative insights into enhancing their position in a competitive, ever-changing environment, while keeping customers happy.
The recent news regarding Toys"R"Us serves as a warning to legacy businesses which haven't yet embraced a digital strategy. Consumers have evolved into a species demanding instant gratification, and it's up to retailers to meld digital solutions so they fit their new business models in order to stand out in today’s market.
Ron Lifton is senior enterprise solutions manager, NETSCOUT, a provider of cloud, application and network performance management, cyber security, DDoS, and advanced threat products and solutions.
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