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The COVID-19 pandemic has impacted a lot of businesses in the retail industry, the integration of technology with retail is needed more than ever. Team eCommerce Next interviewed Sree Singaraju, Senior Vice President AI & Cloud Solutions to get more insights. Following is our interview with him:
How can technologies like contactless payment and mobile apps help retailers keep their employees and customers safe and in-business?
Beyond contactless payment, technologies like “order ahead, pick up in-store” and curbside pickup were not as popular before the pandemic. Now, because of their safety and convenience, more businesses have implemented mobile apps to keep employees and customers healthy while still bringing in revenue.
Retailers have attempted to implement other tools, but they have had limited success. For example, there was a lot of buzz around social distancing tech early in the pandemic, but it has now largely died off. This effort to contact trace and provide digital measuring tools did not work as well as many had hoped because the technology needed is just not advanced enough yet. It is hard to model human behavior with the current tools we have and there were privacy concerns as well.
Because of this, some stores started to indicate the busyness of their locations so customers could make better decisions on when to shop. People have gotten better at policing themselves when it comes to social distancing, so some of these technologies that many thought would become a big deal just faded out.
How do you expect digital strategies to have an impact on the next several months of in-store shopping?
In April, it looked like habits that people developed such as order ahead, curbside pickup, and online shopping were almost a de facto approach for people shopping. And while we see that new methods of digital shopping have become a permanent new habit for many, consumers are starting to go back to their normal routines of in-store shopping for some of their needs. It’s clear that COVID-19 has expedited long term shifts toward digital methods of shopping for the majority of consumers, but because these trends – and the effects of the pandemic on local geographies – are changing so quickly, it is near impossible to predict how digital strategies will impact in-store shopping in the very short-term.
For example, just a few months ago, basket sizes were much bigger because everyone was doing all of their shopping online, now it is much more selective. There are clear preferences for what items people want to pick up curbside and what they want to pick up themselves. However, with the right promotion and marketing tactics, restaurants and retailers can entice people to come back and use those digital channels in the next several months and beyond. If you look at Target, their curbside program is performing really well due to geo-fencing and other key features.
How do digital platforms understand customer patterns and preferences to meet the needs of all customers and how can retailers use this data?
We are able to look at traffic trends for restaurants and retailers to predict orders based on the current situation in the zip code or geographical area. If COVID is really prevalent in certain areas, we can see exactly how that impacts orders. By using these digital platforms to understand customer preferences we can make correlations between location and frequency of orders. For example, early on we saw in-store shopping dip in New York and New Jersey while mobile orders were through the roof. Now we are seeing the exact same thing in Florida. Retailers can use this data to better predict how customers’ behaviors are changing and ensure that their inventory and system processes are prepared for these shifts.
How will the increase of data from in-store, online, and mobile apps help retailers improve and accelerate their digital solutions? Will the tech curve continue to be compressed?
The most successful solutions are built by anticipating customer patterns and preferences to meet the needs of all customers. This means companies need to build agile solutions that can easily change as customer expectations shift. By taking data from in-store, online, and mobile apps, retailers can work on reducing points of friction along the customer journey to create a more efficient and high-quality customer experience. Once these friction points are reduced, mobile users will be more likely to download and utilize these apps.
And, right now, the tech adoption curve has been compressed because digital laggards no longer have the option of refusing to use these apps. With stores closed or operating at a reduced capacity, consumers need to go mobile to take advantage of the contactless payment and curbside options these apps offer. Now that they’ve seen the benefits of these tools and have gotten comfortable using them, we are likely to see a shortened adoption curve moving forward.
What are the best practices for implementing curbside pickup apps and contactless payment strategies?
The best curbside pickup apps and contactless payment strategies are successful because they have a cohesive tech stack. Without one, digital solutions will only create more friction points for customers. Some best practices include having up-to-date inventory, successful credit card transactions, and accurate pickup information — minimizing operational costs while keeping customers satisfied and loyal to the brand.
Once an app is in place, retailers can work out kinks in the solutions and adapt to customer needs over time. Rolling out digital strategies now will establish a reliable foundation to prepare retailers to best meet their customer needs during whatever phase comes next.
What are some challenges companies face when it comes to the functionality of their mobile apps that need to be addressed early on to improve customer services?
When we look at our covid-related retail Friction Reports, a major challenge is that in-store inventory systems aren’t connected properly. That is shocking to see. For example, a shopper goes on the mobile app and sees that a bike is available at the sporting goods store. A shopper makes the purchase and is ready to head over to pick it up curbside. But, they get a call from someone at the store saying they are sold out, they are canceling and the shopper needs to select another bike. Not only is this a negative experience for the shopper, but it also costs the story money to have an employee go through this process.
Many big retailers do not have accurate inventory in their backend systems. It’s not an easy fix, but it is a necessary challenge to overcome if they want users to engage with their new mobile apps consistently. People may give a store a second chance, but if their item is out of stock or the order fails a second time, they will likely give up on that channel.
Are curbside pickup apps and contactless payment strategies the solution for retailers of all sizes? What aspects do retail chains need to take into consideration that small businesses may not need to think about and vise versa?
While creating a custom app is the best way to make sure you are delivering the best experience to your customers, it may not be feasible for all businesses. We wouldn’t necessarily recommend a custom app solution to smaller businesses, and a lot of the platform vendors, are coming up with approaches that target small and medium businesses. These out-of-the-box tools allow businesses to create a shopping experience right on the platform’s site.
In the next few months, Apple is coming out with a strategy that will be beneficial to small vendors who have less than five storefronts. App Clips, which is like a micro-app that users don’t need to download ahead of time, will allow shoppers to use Apple Pay and pick up items curbside. Downloading an app is a big friction point to people, and it’s even harder when people know they won’t use the app frequently. But, with App Clips customers are skipping ahead of all those friction points by scanning a QR code and making the purchase without exchanging any personal information or agreeing to promotional emails afterward.
Why do companies need to take a look at their full tech stack to develop new strategies that lead to seamless customer adoption of new tools?
Companies need to look at their full tech stack to ensure all of their technology is integrated. When companies do not integrate their mobile app with their backend systems, customers can experience that inventory error discussed earlier, as well as incorrect shipping and pickup times. The whole system needs to work together in order to provide customers with a seamless digital experience. Right now, many retailers are offering cobbled-together, clunky experiences. Because of that, a customer’s negative experiences may prevent them from fully adopting these new tools and it may cause them to turn to a competitor who offers a better shopping experience.
Do you expect contactless digital solutions to remain a staple part of the in-store shopping experience after the pandemic has ended?
Things are always changing, but one area where we’re seeing strong consumer feedback through our Friction Reports is around the discomfort consumers are facing when they have to handle payments directly with associates – instead of using a contactless option. The contactless experience has become the norm, and with this, it is now the new expectation that consumers demand. For industries to successfully deliver positive customer experiences, they need to understand that the adoption of touchless-digital options (payments, orders, etc.) is the new way of life.
What will happen to retailers who don’t adopt or update mobile apps to support contactless shopping experiences?
In the past, nearly half of the retail and food companies did not provide a digital storefront and were considered ‘digital novices’. Whether it was because they simply did not have the financial means or the process of developing the solution was too daunting for them to go through, not having a mobile app wasn’t a deal-breaker in the eyes of the consumer. However, this is not an option anymore, companies need to create contactless channels consumers can use.
Because the pandemic is still ongoing and the ability to access stores digitally is crucial, we’ve entered a digital leapfrog moment for retailers. They need to update their technology in order to survive. Most retailers are updating customer service bots, adding curbside picking, and creating a seamless stack from end to end. This ensures their employees are not getting burnout and that customers are not getting frustrated by unfilled orders and leaving for competitors.
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