How omni-channel strategy is driving the retail CIO’s agenda
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How omni-channel strategy is driving the retail CIO’s agenda

Clare Simmons — March 2015
Retailers are under intense pressure to provide a seamless customer experience across all channels, whether digital, physical or a blend of the two, says David Concordel, VP and head of Fujitsu’s Retail Solutions business.
New channel mix

I-CIO: Most retailers now recognize the need to deliver a joined-up customer experience across a variety of digital and physical environments. But how far along are they in terms of achieving that?

David Concordel (DC): The digital transformation of retail is leading retailers to reconsider the way they go to market. They are thinking about how customer experience creates differentiation and attracts and retains shoppers.

We’ve watched as retailers have moved from considering omni-channel retail as an interesting idea to feeling that they now have to act. Indeed, most now see it as a top priority. They are under huge and constant pressure to be competitive [on costs], but they should also see this as a chance to capture new market opportunities and grow the top line.

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The whole retail industry is undergoing a massive transformation, so omni-channel really needs to be a business decision as well as an IT decision — although of course IT is key to its implementation and execution.

There are three areas of focus to today’s retail IT conversations. As well as discussing the traditional function/features of retail, there is now also a much more strategic discussion around direction and changing the IT architecture to support future growth. Thirdly, there’s the exploration of how omni-channel relates to a retailer’s evolving processes, which leads them to reconsider operations in and around their stores.

But it’s rarely purely a technology discussion. It’s more about the combined vision, solutions and architecture, with technology used to enable these goals.
Business-driven decisions

I-CIO: The CIO will typically be responsible for implementing many of these new technologies, but it’s no longer necessarily the IT team driving the technology decision. Who are the new IT stakeholders in retail?

DC: The most successful discussions involve a variety of business leaders. The IT organization is still an essential participant, but they’re not the only voice — other stakeholders must be involved in order to drive the business case forward. For example, it is the chief marketing officer who increasingly holds budget for IT spend.

The decision-making process becomes more transversal to the retailer’s organization — you’ll have operations, both store and ecommerce and, in some companies, a chief digital officer all contributing to the process.

Often that digital director role will be a cross-functional, business program management position, not an IT management position — it’s about driving transformation and embracing digital.

So it’s essential for CIOs to start having the omni-channel retail conversation with the whole business, and relating this to the customer experience it wants to deliver, aligning those to strategy goals. They need to demonstrate how this will differentiate the brand and what it means for operations, systems and processes.
Leading the pack

I-CIO:Which retailers are leading the way with omni-channel initiatives? Is it too soon to point to best practice examples?

DC: The market has been talking about omni-channel for a while, but we are at the beginning of this journey. Retail tends to run on very thin margins, so its propensity to adopt new concepts and technologies can be lower than other industries. However, we’re now starting to see some great examples. In the UK, John Lewis [department store chain] is one of the best, and, as a result, has been able to capture a leading position in the market via brand differentiation and innovation [see John Lewis’s journey to omni-channel retail].
Big data opportunity

I-CIO:One of the key facets of any omni-channel retail strategy is the capture and use of vast amounts of customer data. What part are big data platforms starting to play in omni-channel retail environments?

DC: Retailers want to understand their customers, but they have traditionally sat on massive amounts of data and scarcely exploited that. Big data is essential to omni-channel because it’s all about moving from a transaction-centric to consumer-centric model. Data analytics and predictive analysis will be the future direction of innovation for us.

Customer experience is such an important factor in this process, and analyzing shopper behavior can enable the implementation of personalized campaigns at point of [data] collection. These campaigns can be created frequently — daily even — and have the potential to add value for the shopper and create double-digit growth for the retailer. But that’s just the start: the next important step is real-time analysis of big data.
First published March 2015
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