6th April 2021
Retailers can adapt quickly to changing consumer demands with a tech stack that facilitates agility, innovation and growth.
Retailers have spent years chasing consumer demand for a seamless shopping experience across every channel — with mixed success. The pursuit of a 24/7 personalised experience that integrates physical and digital channels to give customers precisely what they want when they want it is impossible for retailers who lack the ability to respond effectively to relentless change.
However, a tech stack that facilitates rapid adaptation, innovation and growth can help retailers remain relevant to customers into an uncertain future.
The challenges for today’s retailers
The Covid-19 pandemic accelerated the shift to online shopping and home delivery, a shift that is likely to persist post pandemic. Shoppers who had positive experiences when they had a reason to experiment with new ways to shop, such as for groceries and essentials, are likely to continue the practice once they are no longer compelled to shop remotely.
China’s experience suggests retailers should expect year-on-year growth of between 10% and 20% in online activity in most categories as the market moves beyond Covid-19 restrictions.
The realisation that more flexible order fulfillment options and working arrangements would have made life considerably easier for retailers during the crisis is awakening a stronger sense among businesses that they need to up their game significantly to deliver what customers want. More advanced technology would have made them more flexible and better able to manage steep fluctuations in demand.
Pressure on retailers is driven not just by consumer demand but by the cost of trying to satisfy that demand while competing with discounters and digitally native rivals. Retail margins declined from 5.1 per cent to 3.4 per cent between 2013 and 2019, establishing a continuing trend impacted by factors like increased competition and the high cost of running omnichannel operating models.
As technology advances, retailers will need to reconsider the very nature of their retail offerings and revisit value propositions for both customers and employees. Instead of just automating their existing operating models, many need to overhaul the whole suite of tasks required to run a store.
How retailers can differentiate themselves
With consumers now accustomed to alternating between online retailers and physical stores, they see no reason why the brands they buy shouldn’t do the same. The hybrid model of shopping that has emerged from the pandemic makes it increasingly clear that retailers need to focus on omnichannel excellence to give shoppers their desired combination of digital commerce and brick-and-mortar stores. Some of the key retail technology trends that have emerged include an increased reliance on shopping and payment apps, as well as more retail mobile apps.
Some shoppers are keen to return to physical stores once restrictions are eased, whereas others now prefer the convenience and safety of shopping in comfort at home. Research indicates that 70% of consumers plan to continue or increase their online shopping after the pandemic restrictions end. But not all of these will avoid stores completely; some enjoy the experience of browsing in a real store.
Nonetheless, consumers will want a safer, more enjoyable in-store experience to entice them off the sofa to do their shopping. Retailers will need to provide an omnichannel experience that includes unique product offers and other attractions to keep their customers from straying to digitally optimised rivals.
They could learn from Nike, which expanded its omnichannel experience in 2006, when it partnered with Apple to introduce the Nike+ program. Customers could connect their Nike sneakers to an iPod and track activities such as distance run and calories burned. By allowing users to sync their data to the Nike+ website, Nike created a digital community of athletes.
Nike doubled down on its digitalisation during the pandemic while also focusing on member engagement, with the aim of strengthening relationships with customers in value-added ways. In its physical stores, Nike Live bases its inventory on local member activity and buying patterns.
Members can use Nike’s mobile app in stores to scan barcodes for product details and reservations and to avail of promotions. This hybrid of physical and digital experiences encourages a sense of community among customers and boosts brand loyalty.
The role of an advanced tech stack in facilitating omnichannel retail
The key to succeeding in an omnichannel retail environment is to build agility and resilience so you can adapt and scale as required. With 77% of executives emphasising the importance of their technology architecture to their organisation’s overall success, industry competition is now a contest between technology stacks.
Retailers will need to re-architect the entire business to get closer to their customers, remove internal silos and align staff behind the organisation’s goals. This is possible with a well-designed technology stack that can accommodate the demands of an ever-changing retail reality. When planning such a tech stack for your retail business, certain elements will determine success.
Preparing your organisation for an omnichannel future extends beyond devising solutions to specific problems. Instead, you need to focus on developing a platform of technology, people, processes and tools that can scale and adapt quickly to suit your business.
A scalable platform enables a holistic approach to technology, so you can be confident your tech stack will meet future business needs and avoid obsolescence. Such a platform evolves in line with your organisation’s requirements. Whether you decide to optimise your existing stack or build an entirely new digital platform, it needs to work now and into the future.
Adopt a cross-platform approach
Many companies maintain multiple teams to develop, test and run different versions of the same app for Android, iOS and the web. This is a costly and cumbersome approach to the frontend and can be avoided with a cross-platform strategy, which involves developers reusing the same code across each OS.
Embrace design-led development
Design-driven development treats development as an interdisciplinary, integrative process. It is an approach that has proved very successful for many NearForm projects across a range of clients, including the Covid-19 contact tracing apps.
The process starts with a discovery workshop that gives the stakeholders a roadmap for development and tangible assets for reaching their objectives. The engagement unites designers and developers in ensuring that the finished product aligns with the end user’s requirements. By adopting a design-led approach to developments, retailers shift their mindset to one that focuses on user-centric strategies across the organisation.
Choose a flexible, modern architecture
Optimising your tech stack to take advantage of an omnichannel retail future prioritises characteristics that will encourage your organisation to be flexible. For example, microservices support an architecture that structures an application as a collection of lightweight, independent services that centre on particular business-focused objectives. This approach enables flexibility and means teams can be agile and deliver the change your retail business needs without undergoing massive disruption or cost.
Your architecture should support a continuous change engine that allows you to align your teams with your business KPIs rather than with technology silos. Adopting a multiplatform approach with React/React Native teams means your people develop cross-platform from a single codebase, so they focus on specific business logic rather than the technology required to develop separately for each platform.
When considering your architecture, it’s important to assess the overall ecosystem, the talent that you require and the kind of organisation you could create with the help of the right technology and the right processes. Ultimately, you need to figure out where you want to be in order to identify the technology to get there.
Componentisation is an approach to software development that involves separating software into identifiable modules that developers write and deploy independently, then configure with network connections and workflows.
It means that components can be reused and connected using standard interfaces, facilitating easier collaboration, accelerated product development and increased software reliability in the short term. In the longer term, componentisation enables greater flexibility because components can be changed or replaced easily to fulfill shifting business requirements.
Scale with cloud-based apps
Even with limited in-house resources, engaging with a partner to provide you with design artifacts means you can build out the cloud-based web applications you need into the future. Developing capability in your teams enables them to become self-sufficient and create new concepts and web pages independently, as required. By combining recurring patterns and using elements from an expanding library, they can create user-friendly cloud-based apps that scale with your business.
This is what we did for Spanish technology company Datumize. After an initial discovery workshop, NearForm redesigned and built the user interface for the company’s self-service dark data collection and processing platform, Zentral, and used the Zentral codebase to develop a modern, touch-compatible, React web application that connects to the microservices a Datumize user requires to build and deploy their data pipeline.
To enable the scalability of the Datumize portfolio, NearForm supplied the team with a library of design artifacts they can use to create new concepts and webpages themselves in the future.
Seizing the omnichannel opportunity
Equipped with a robust and flexible tech stack, a forward-thinking retailer can respond to constant disruptions, establishing the sort of sustainable resilience it needs to drive innovation and growth.
Retailers with the right mindset will see the level of disruption on the horizon as more than a challenge — it also represents an opportunity to adapt consumer value propositions and operating models so they can deliver an attractive, tech-enabled omnichannel offering that outperforms the competition.