Retail in the new normal: Masters of AI reviewBy Marlee Briscoe on June 10, 2020
Masters of AI was back this week, albeit virtually, as we tackled the issue of the upcoming ‘retail reset.’
The theme of the afternoon was focused on the impact of COVID-19 on the retail industry, how things have changed since lockdown, and what the sector’s future might look like as we enter the ‘new normal.’ Manjt, our host for the afternoon, kicked things off by explaining Peak’s retail vision.
She said: “During the last couple of years, we’ve been talking about what the modern customer expects. These needs fall nicely into three Cs: context, convenience and control.”
Context refers to customer expectations of being treated as individuals and seeking out personalized experiences. Convenience, meanwhile, means giving shoppers the ability to browse and buy how and when they want, while control is all about customers engaging with retailers on their own terms, with no concern around payment, delivery or returns.
The coronavirus pandemic has amplified the importance of these three Cs across pureplay and multichannel retail. High street sales have stalled, e-commerce has proved resilient and grown exponentially, and those who have adapted successfully are driving higher revenues. However, it isn’t easy. Online pureplays who have seen a phenomenal surge in demand are struggling to cope from a supply point of view, while multichannel retailers are faced with huge amounts of terminal stock trapped inside closed stores and big decisions to make on the best way to deal with this.
“Retail is being completely reinvented before our very eyes, and as consumers reinvent, retailers need to be able to to keep pace with the modern consumer,” said Manjit.
Next up, Tom walked us through how retail will reset in the coming weeks, and keep in pace with the hyper-amplified expectations of the modern customer. Tom’s presentation focused on the comparisons between the current pandemic and the infamous 2008 credit crunch, which resulted in several leading high street names closing up the shutters for good.
“In 2008, many businesses who had been bold enough to start embracing e-commerce ended up surviving and prospering, gaining momentum and remaining agile in this new multichannel commerce world,” said Tom. “2020 will also go down as a seminal moment for retail. It will scar the landscape more than anything that has gone before it.”
“Many retailers have been catapulted into the future in terms of the new demand being placed onto their businesses. John Roberts (founder and CEO of AO) said recently that five years of strategy has been deployed in five weeks!”
“Businesses are guilty, sometimes, of moving slowly in terms of change – but technology continues to move fast. As time moves on, the gap between the two widens, eventually requiring a ‘reset.’ Like it or not, we’re in one of those moments now.”
Courtesy of Scott Brinker (@chiefmartec)
Tom explained his belief that “everything is marketing,” emphasizing the importance of customer experience – and that the ones who will come out of the retail reset winning recognize this.
“Pre-2008, the shopkeepers held the power – it was a ‘build it and they will come’ mentality. But after the recession and rise of e-commerce – and the dynamic choice that comes with it – the customer gained all of the control. This reality is not fully awoken in all businesses, and some are at risk of not adapting in time.”
Tom then talked us through some of the ways artificial intelligence (AI) can be utilized by retailers to provide more personalized experiences, execute profitable markdown strategies and optimize fulfillment to meet demand in order to provide customers with the three Cs.
“In 2008, we turned to e-commerce, and in 2020 we turn to AI. We’re seeing a lot of business turning and facing new technology and how they can utilize AI across their businesses to succeed in these unprecedented times.”
💻 View the Masters of AI presentation slides here 👇