Background:

At FINN Partners, I worked with BytePlus, the enterprise arm of ByteDance, to develop an article about the role of data in the evolving e-commerce space. This piece sits at the awareness level of a comprehensive content marketing campaign for BytePlus' entry into the APAC e-commerce market.

Format: 

Blog article

Data: The Gold Standard of Tomorrow’s Omnichannel Retail Landscape 

With almost 50% of e-commerce decision-makers in Europe and North America believing that omnichannel strategies are very important to their business, it is clearly the way of the future in the retail landscape. A similar trend is visible in Asia with e-commerce expected to reach 30% of retail sales in China and 20% in emerging Asian economies by 2025. However, effective omnichannel strategies involve far more than creating multiple ways for customers to engage with a brand. There needs to be cohesion between the channels so that customers enjoy a seamless experience when moving from one channel to another.

Data analytics enables retailers to understand the preferences and choices of each customer and build an experience that matches their expectations. These tools also facilitate better inventory management even with the complexity of multiple channels. 

The trend towards omnichannel strategies is being driven by consumer demand. About 75% of US consumers indicate that they are researching and purchasing both online and in-store. In the Asia-Pacific region, 54% of consumers purchase groceries both online and in-person. In fact, the modern shopper uses almost six touch points per purchase, as compared to two touch points 15 years ago. Retailers must meet these evolving consumer needs with speed while delivering an exceptional customer experience.

The modern shopper wants more flexibility, more personalization, and a cohesive experience across different channels. Surveys show that 72% of consumers expect retailers to know their purchase history regardless of which channel they used, and 74% of consumers like the idea of a website curated to their interests. The EY Future Consumer Index reveals that 64% of Asia-Pacific Consumers are willing to share personal data in order to facilitate a tailored online experience.

Omnichannel is all about providing a frictionless customer experience. As customers move seamlessly across these channels, data moves with them too. Here’s how retailers can tap on the latest data analytics solutions to drive omnichannel success:

Tapping on data insights to drive a seamless, consistent experience across channels

Excellent customer experience is a critical success factor in the modern retail environment. A recent study quoted by CX Today highlights that 79% of customers will move away from a brand after a single poor customer experience. In the omnichannel environment, a seamless and consistent experience across channels is critical to achieving a high level of customer satisfaction. This experience is highly dependent on the quality of data insights developed from a user’s interaction and the sharing of those insights across all channels instantly.

Customers are looking for a seamless experience when moving between channels in an omnichannel retail environment. If they access an email showing online promotions and then open the brand’s application, those same promotions should be clearly visible and easily selected. After making their purchase on the app, they expect their product to be waiting at a self-service kiosk or in-store so that they can complete their transaction without repeating any steps or waiting for confirmation.

Whether they interact with a promotional email, the brand app or self-service kiosk, customers expect the next step in the buyer’s journey to build on the conversation to date. It is not sufficient to have multiple channels available for customers to use that operate independently of one another. An omnichannel strategy uses data insights across all channels to offer a seamless and consistent customer experience.

Modern customers expect their preferences and choices expressed in one channel to be considered when shopping in another channel. Data analytics makes this possible and enables retailers to build a frictionless buying experience based on their customers’ wants, needs, and preferences. Retailers can deliver tailored product recommendations based on a customer’s purchasing history and all their interactions within the omnichannel environment.

For example, a customer who searches for specific products during season changes can be offered promotions that match their needs at that time of year. Data insights using clothing sizes, brand preferences, or past purchases, can all be used to create an experience tailored to each customer’s unique preferences. The result is a buying journey that the customer enjoys.

Data can help streamline and improve omnichannel inventory management

In the past, retailers have used historical purchasing patterns as a basis for predicting future demand. Inventory levels were set based on a limited data set of past orders. However, this approach is too simplistic for a complex omnichannel world. Inventory visibility becomes more challenging as the number of channels increases, which impacts on-demand planning and inventory management. The challenges of supply chain disruption also influence product availability and therefore contribute to the customer experience.

Analyzing data from suppliers, internal stock levels, and transactions in each channel can provide the historical and real-time data for inventory management. However, retailers also need to factor in predicted buying patterns based on customer preferences and behavior using data analytics.

This data-centric approach will ensure that the inventory levels and locations are adequate for the anticipated customer demand from each channel. As an example, data analytics could use historical promotion data to predict the impact of an in-app campaign on future stock levels. This allows for timely orders that maintain minimum stock levels and keep orders fulfilled to customer expectations. An integrated view of data across the retail value chain thus enables retailers to make quicker and better decisions and, therefore, respond faster to customer needs. Data analytics for inventory management offers two main benefits:

1. Improved order accuracy: this is a vital factor in customer satisfaction but is difficult to achieve with multiple channels. A buyer that switches channels during the purchasing journey expects their product selection to be maintained. This requires a high level of cohesion between channels and consistency in data management.

2. Improved inventory visibility: this enables retailers to see and monitor inventory stock levels in real time. It depends on both physical stock levels as well as a prediction of demand surges based on anticipated customer behavior. Excellent inventory visibility enables retailers to manage inventory storage locations and costs.

Data insights for the future of omnichannel retail strategies

A successful omnichannel strategy is one that brings together both cohesive customer engagement and streamlined operational platforms. The right data analytics foundations must be established to collect, track, and analyze data from every channel in order to derive useful business insights that can not only help drive an exceptional customer experience but also more efficient inventory management.

BytePlus Analyze is one such data intelligence tool. It allows retailers to curate a hyper-personalized customer journey using their preferences and purchasing history. Also, the data can be used to provide insights, which in turn allows for inventory optimization. Finally, BytePlus Analyze allows retailers to develop experiments, improve retail channels, and automate workflows that deliver the right message to customers at the right time.  

Modern retailers already understand the need for multiple channels. The omnichannel retailer of tomorrow joins these channels together into a cohesive whole using the right data insight tools. The result is that customers enjoy the freedom of choosing their channels while maintaining the look and feel of a single ecosystem.