The evolution of e-commerce culture has particularly affected one demographic: the millennial. This collective term we hear about in today’s media is set to make up 75 per cent of the working population by 2025. This represents a massive share of the retail market.
At the heart of the millennial’s modus operandi is consumption of technology. After all, this is the Facebook and Instagram generation, where owning the latest smartphone is akin to a higher social status. This obsession with technology is in turn influencing how retail sales are made.
We know that millennials hold great sway when it comes to retail sales, but what services do retailers need to deliver to capture sales? What is the technology driving the market?
To target millennials successfully, retailers have to go down the omnichannel route. This is important as it will support marketing strategies across all channels — online and offline. Omnichannel can deliver personalised content to customers at the right place and at the right time. This can also be used to analyse key metrics such as store visit frequency, repeat visitors, customer retention and cross-store visits.
Linked to omnichannel is the popularity of click-and-collect. Put simply, the typical millennial mindset is one of instant gratification — an “I must have it now” mindset. Step forward click-and-collect.
In the case of in-store pickup, a notification can be sent to the enterprise’s picking systems when the consumer comes within a certain radius. This notification prompts staff to get the order ready. This is seamless retail in 2018.
A further area of growth driven by millennials is free returns. In fact, increasing numbers of e-commerce sales are accompanied with the offer of free returns to avoid unsure customers leaving with incomplete sales. Returns processing inevitably comes at a cost for retailers, impacting margins.
So this element of omnichannel also rolls into that of click-and-collect, in which one best practice methodology is to encourage customers to try out their goods on the spot, minimising the risk of damage or loss and bringing forward any returns. This minimises the time a stock is out of the inventory cycle.
Some retailers’ stores are increasingly being treated as warehouses, creating a single view of stock across the business wherever it sits, and often enabling shipping and receiving returns directly to the local outlet.
After the items are ordered, packaged and ready for collection, it’s time for payment. For millennials, the preferred method is mobile payments as they prefer not to carry cash. Retailers need to ensure mobile payments are at the forefront of their offering to engage with this specific audience.
Driving sales with technology
Identifying the services that millennials desire is an easy enough task, but what technology is needed to deliver these? Managing the operation behind the shop front is a vital factor in retail strategy.
Central to the conversation is the internet of Things (IoT). And while much of the conversation surrounding IoT may seem like hyperbole, connected devices are not only the future, they are the now. Our research found nearly 96 per cent of retail decision makers are ready to make changes required to adopt IoT.
The study revealed retailers are investing in IoT technologies — from beacons that send shoppers customised coupons to radio frequency identification (RIFD) tags that track inventory — to simplify, enliven and customise the shopping experience, generate revenue, and reduce costs. They’re embracing IoT platforms to transform real-time, visibility-driven data throughout the supply chain into actionable insights.
IoT has the power to transform how we shop. Many retailers have in-store inventory visibility challenges. Technological advancements in areas such as machine vision, RFID and data analytics — underpinned by IoT — are enabling more advanced business visibility by allowing retail inventory to be “seen” and connected by both staff and customers alike.
Aside from IoT, machine learning is playing a vital role in targeting millennials. This technology utilises analytics and predictive models to help retailers personalise customer experiences and enhance inventory demand, forecasting and visibility. The outcome is increased and repeat sales as well as great customer satisfaction.
This latter point is vital in today’s digital age where millennials can post negative reviews if they feel they are getting short-changed.
The final powerful tech up the retailer’s sleeve is automation. This often involves the identification of areas where mundane tasks can be automated, freeing up staff to focus on customer service and sales tasks to improve conversions.
This technology is vital for ensuring packing and orders are shipped efficiently, inventories are tracked meticulously, in-store inventory levels can be monitored and customers can find their items. Automation could be described as the unsung hero in the retail mix.
— Mark Thomson is Director of Retail Solutions, Zebra Technologies.