The retail industry is undergoing a massive change due to technology. In Asia, online retailers are flourishing because of their ability to target consumers anytime, anywhere, and across international borders. However, many traditional retailers are struggling as a result, finding it difficult to bring consumers into physical stores.
To be successful in today’s competitive landscape, retailers need to pay close attention to technology trends like e-commerce, mobile, the Internet of Things (IoT), and more. These trends are altering consumer expectations around how they want to interact with retailers and acquire merchandise.
In the past, retailers used to follow a prescriptive formula of planning inventory, buying merchandise, moving it to retail outlets and selling it to customers on a particular schedule at a particular price. Now, retailers must deliver seamless customer experiences across all channels, requiring a new, more personalized approach to the customer relationship.
Redefining the customer experience
Today, consumers can open their internet browsers, search a broad marketplace, and order merchandise within minutes. They expect to find and buy what they want when they want. Additionally, consumers expect more than just a product transaction; they want a fully connected and personalized experience. If a retailer fails to meet expectations, consumers will move on. According to MuleSoft's Connected Consumer Report, 63% of consumers would consider changing retailers for a competitor if they received a disconnected shopping experience.
It is clear that retailers need to create agile businesses that can flex with consumer expectations, and many are already recognizing this need. MuleSoft's Connectivity Benchmark Report 2018 revealed that 77% of retailers identified improving the customer experience as a key priority for their digital transformation initiatives. Investing in mobile applications, setting up e-commerce platforms, modernizing legacy systems and developing omnichannel strategies were among the top initiatives.
To redefine the customer experience, it's paramount that retailers leverage technology to provide a seamless journey across all channels. One way to accomplish this is through an omnichannel strategy, underpinned by application programming interfaces (APIs).
The Omnichannel Strategy
According to Accenture's Capturing the Potential of Omni-channel Commerce report, retail customers who engage in multiple channels spend up to 37% more than single-channel customers. On top of that, they tend to be powerful advocates for the retailer. Therefore, it is in a retailer's best interest to develop an omnichannel strategy.
Beyond solving business problems today, building an omnichannel strategy can also solve for agility in the future. Omnichannel is about becoming channel-agnostic so that customers can interact with your business where it suits them best.
The secret to successfully implementing an omnichannel strategy lies in connectivity. Connectivity allows retailers to combine data from disparate systems and applications across their entire ecosystem to provide a 360-degree view of the customer. To accomplish this, retailers are increasingly turning to APIs or software intermediaries that allow applications and systems to talk to each other, regardless of format or source.
Each API created can be developed to play a specific role in the omnichannel strategy. For example, one API might unlock data from an ERP system, another might orchestrate data from multiple systems, and another might surface that data up to a mobile application or website to provide a unique insight, such as real-time store inventory or purchase history. With this approach, rather than setting up separate point-to-point integrations for each channel, every asset becomes a managed API, making it discoverable through self-service without losing control.
Taking an API-led approach to connectivity also offers up the unique ability for retailers to organically build an application network, or a network of applications, data, and devices connected via APIs to make them pluggable and reusable. With an application network, retailers are empowered to build a fully connected customer experience.
Leading the way
Forward-thinking retailer, Lane Crawford, for example, is tackling the omnichannel challenge head-on by launching its first mobile shopping app. By exposing its CRM and e-commerce applications through APIs, Lane Crawford was able to create a data-as-a-service platform to orchestrate 360-degree views of customers and inventory, such as up-to-date loyalty balances and shopping history. The same APIs are leveraged across digital channels, including their new mobile app, website, and WeChat, one of China’s most popular text and voice messaging apps.
The launch of its mobile application is just the start of the developments that Lane Crawford plans to launch as a result of creating an application network. Lane Crawford has set up an innovation team and is building out a repository of APIs in a center for enablement to maximize IT reuse. Future projects will focus on expanding WeChat capabilities and creating internal applications to increase operational efficiency.
Additionally, globally athletic footwear and apparel company ASICS is building an application network to enhance customer experiences. ASICS is using APIs to unlock backend systems and promote governed access to critical customer information, including real-time inventory, pricing and order statuses. As a result, ASICS is able to build direct and personalized relationships with its customers across the globe.
To build a lasting retail brand that flourishes today and tomorrow, companies need to leverage an omnichannel strategy underpinned by APIs. It's no longer enough to maintain a physical storefront. In the age of Amazon and instant gratification, retailers today need to be driven by data and powered by software to compete effectively.
This article is contributed by Chris Curtis, Regional Vice President, Asia, MuleSoft. The views and opinions expressed in this article are those of the author and do not necessarily reflect those of CDOTrends.