We can’t see it but it’s evidently growing exponentially with sales and transaction figures rising so fast anywhere in the world. That’s the power of eCommerce and digitalization. Its global, fast and omnipresent. And the retail industry is well cognizant of this.
By definition, anything purchased online is considered part of the eCommerce market. Today, purchases on the digital channel have expanded to include those bought via desktop computers, notebooks, laptops and mobile devices such as smartphones and tablets.
Experts have broken down eCommerce into four traditional types—B2C (Business-to-Consumer), B2B (Business-to-Business), C2B (Consumer-to-Business) and C2C (Consumer-to-Consumer), including B2G (Business-to-Government) which is often lumped in with B2B.
Bain & Company described eCommerce as the “engine of the global retail trade” valued in trillions growing at an annual growth rate of 24%.
In the MENA region, the retail industry’s digitalization is changing the way consumers spend their money on shopping. So much that in March 2017, Amazon acquired for $580 million souq.com, a leading online company in the region. That same year, Emaar Properties launched noon.com, another eCommerce platform, backed with $1 billion funding from the Public Investment Fund of Saudi Arabia, Bain & Company pointed out in a report.
Those multibillion deals speak about how confident investors are on the future of eCommerce in the region. With that practically all companies, retailers in particular, have invested on their digital footprint—websites, interactive online stores, social media campaigns, etc.
Enter the financial tech companies to seal the deal made on digital purchases, traditional banks with their debit and credit cards included.
This is our new normal—digital combined with physical existence.
For retailers, this means investing on reliable internet service providers, creative people to effectively market their merchandise and products, IT people who can run the show digitally seamlessly as well as measure consumer behaviour through data and purchasing patterns.
The crux of the matter is knowing your customer like the back of your hand. And nowhere in time since the industrial revolution and laissez-faire capitalism is this more imminent than now as digital tools provide a more objective analysis of what consumers want, ergo providing retailers with the opportunity to produce accordingly and swiftly deliver.
Gone are the days when retailers splash their vitrines with apparel, for instance, put in a cardboard that says “new arrivals,” play some upbeat music then lie in wait for buyers. This is so old school. Retailers admit they have to go with the winds of change or it’s going to be belly-up.
Weighing things out, the benefits far exceed the disruption and headaches with the learning curves.
For one, digitized operations make it a lot easier for retailers to communicate with their target market through the mentioned social media channels, including websites, mobile apps, even chatbots. Engagement is the key, and this goes a long way in boosting loyalty, rolling out promotions and leaving memorable impressions on your customers.
Digital transformation also boosts efficiency and, in return, productivity. Cloud technologies – the abracadabra of modern times – make this possible by way of automation.
Employees are relieved of time-consuming manual tasks and can be more productive in other areas of operation requiring a more focused attention. In other words, automation makes it possible for employees to have more time for what is called “mission-critical tasks.”
Digital transformation also provides for convenience. Talk artificial intelligence (AI) here and – voila! – you have shoppers enjoying the whole experience of listening to and following recommendations of an AI chatbot.
In this respect, automation also enhances the customer experience as services and products are delivered faster.
Likewise, store owners can have the luxury of not being limited to their stalls as they can make use of social media platforms to reach out to more people.
Experts say the Internet of Things (IoT) and “immersive experiences” derived from Augmented Reality (AR) and Virtual Reality (VR) play important roles in this area.
Another factor that compels retailers to go digital is challenges in the supply chain where problems arise in ensuring sound inventory and the visibility of their products as well as in tracking shipments and deliveries. Digital tools address these issues by providing transparency and speed.
Today, shoppers know very well that their details are being collected and so they require a personal approach. Without digital tools, retailers would have never gone far in obtaining information about their market and turn things around to provide quality, even bespoke, shopping experience.
And lastly, another compelling reason to go digital is the millennials – the biggest consumer base who are so attached, dependent if you will, on “omnichannel shopping tools,” making purchases in their mobile phones and always on the go.
End of the day, it’s digital or bust. Indeed, the digital world has so changed the retail landscape such that it has blurred the line between physical presence in the stores and online purchases; and made a lot of sense in digitizing everything.