Using Technology To Be Disruptive In Retail1st Nov 2019
According to recent reports, Amazon took $500 Billion in market share from ecommerce companies in the last 4 years. Uber has a global market value of $72 billion, and Air BnB just overtook Hilton in US consumer spending.
What do all these businesses have in common? The answer is they are technology disruptors. Their smart use and quick adoption of the latest tech advancements, helps them to undercut their competitors and offer ultimately, a much more convenient solution for consumers.
What is disruption? - To go against the perceived norms in an industry used by the current market leaders, disruption creates an alternative to the standard that often makes the previous way of doing things seem archaic.
You take a common problem or complaint in the market, and come up with an intelligent alternative that your competitors are refusing to adapt to, or perhaps not even thinking about.
Here are some examples:
PayPal offered secure payments online where users did not have to remember their card details, just their account password.
Amazon offers next day, or often same day delivery on a huge range of goods, when most companies will offer much longer terms.
Ocado offered online shopping delivered to your door at a scheduled slot, so people no longer had to visit the supermarket.
More specifically, let’s take a quick look at some of the latest disruptive ideas in retail:
Supermarkets are making strategic partnerships with smaller brands to offer a one-stop location to fulfill several needs at once. Most Sainsburys now also house a Timpsons and an Argos. Matalan is now a major click and collect location for DPD, and many Asdas now host a range of digital machines such as photo booths, photo printers, coin counters and mini Timpsons kiosks.
Ikea has recently launched a furniture rental scheme. Firstly, this is in response to environmental activism, so Ikea seeks to send less furniture to landfill using this method. Secondly, it’s responsive to the way the current emerging generations need to live. Most millenials are either choosing to live more dynamically, and travel more, or simply cannot afford to get on the property ladder and buy a house. Furniture rental allows them to fill rented accommodation without a heavy initial outlay, and with no need to store or transport furniture when they move.
We’ve always heard about experience stores, but more often now bigger department stores are seeking to amalgamate digital and physical retail experiences. They do this by implementing pop-up brand showcases and interactive experiences with limited edition brands. Just look at how Selfridges has recently worked with Depop. It gives consumers a reason to repeatedly visit the store, knowing it will be a new experience on each occasion. Department stores also often use their space now to let users experience products, Harrods in London has been known to host space for new cars, and offered ways to try out AR. These things may not be affordable to their average visitor, but they do offer a sense of wonder and excitement that draws people to visit and look at other products.
To facilitate these experiences in store, you need a strong IT infrastructure wherein these digital facilities can be hosted. Matalan would not be able to run a click and collect function without the facility to scan customer barcodes from their phones, and even a pop-up kiosk needs strong business wi-fi.
How To Come Up With a Disruptive Strategy
The very premise of disruption is that it isn’t exclusive to businesses with big budgets and infrastructure, it’s open to anyone with big ideas and an ability to think outside the box.
Conduct market research to enable you to identify common flaws with the way things are done. Sometimes they are glaringly obvious, but no one seeks to change them through sheer common practice. Take a look at your business’ common complaints, or those of your competitors.
Consider some of the emerging technologies - are your competitors investing in them? What do they enable you to do?
RFID for example, has been used for years in warehouse and logistics, but are your competitors bringing RFID into a strategy with the Internet of Things to manage their entire supply chain? This could enable you to offer same-day click and collect, or same-day delivery, or perhaps you could install digital touchpoints in your store where people could browse your full catalogue using this data.
Would installing reliable customer wi-fi enable you to make some innovations in your business? Bookstores, cafes and hotels could offer flexible workspace for freelancers and mobile business people, councils could make public libraries more interactive.
Take some time for some creative brainstorming with your team. What is the market crying out for that no one is giving them?