Consumers drive retail’s digital transformation, says Microsoft
From e-commerce to omnichannel, customers drive retail’s digital transformation in the Middle East and Africa (MEA), Microsoft, the software manufacturing giant, has said.
The company noted that the pandemic left little room for error when it came to adapting to the new normal, adding that, for retail, this meant e-commerce experienced a renaissance, ‘omnichannel’ as it received a lot of attention and customer experience was no longer an after-thought but a necessity.
‘’Meanwhile, it’s the customer that lies at the heart of these new trends and will ensure their staying power,’’ Ola Williams, Country Manager, Microsoft Nigeria, noted, adding that globally, retail is a $25 trillion market with e-commerce accounting for a sizeable $9 trillion.
In the MEA, he said, Microsoft retail customers reported that online sales brought in between 2 and 5 percent of revenues before the pandemic. ‘’Today, this has reached around 20 percent of top line profits. This is an extraordinary amount of growth that took place in just two years, and according to Mastercard’s Economy 2022 report, this shift is expected to stay,’’ he said.
Williams recalled that the federal government recently said the current e-commerce spending in Nigeria has grown to $13billion per annum and was expected to hit $75billion in revenue per annum by 2025.
He added that with an increase of 30 percent, the Nigerian eCommerce market contributed to the worldwide growth rate of 29 percent in 2021, noting that the place of e-commerce in the Nigerian economy was being boosted by gradual transition of informal retailers into the online shopping community.
‘’While this move to online shopping is a game-changer for many retailers, it does not mean this is the end of brick-and-mortar stores. In fact, we are seeing omnichannel retail becoming a key approach for brands as they look to navigate a post-COVID-19 landscape.
‘’As lockdowns eased, consumers returned to their favourite stores, but were now more likely to have looked up the desired item online beforehand or research a product while perusing the shelves in person,’’ he said.
Williams is of the view that retail brands that are able to seamlessly connect their customers to these different touchpoints will unlock greater business value, citing a Harvard Business Review study which found that the more channels customers used, the more valuable they were.
According to him, Omnichannel customers spent, on average, 4 percent more in store and 10 percent more online in comparison to single-channel customers. He added that a seamless approach to creating customer engagement from the virtual world into the physical could yield results for retailers.
Believing that the customer is always right, Williams noted that the omnichannel approach was also having a positive impact on the customer experience. ‘’It’s through these multiple channels that shoppers are given more choice than ever. Consumers are looking for brands that meet all their needs, whether it’s browsing online or in-store, or opting for delivery or curb side collection,’’ he said.
He pointed out that retailers were further building on the customer experience through personalisation, noting that ‘’data holds the key and customers are more comfortable sharing their data in exchange for better services and experiences.’’
He disclosed that MyMusic, a digital music platform in Nigeria that allows users to download high-quality local music and pay for it in a convenient way through mobile airtime, partnered with Microsoft to use cloud technology as the backbone of their product.
He explained that, using Microsoft Azure and its related services, MyMusic has integrated data analytics, machine learning and augmented reality into their solution.
‘’MyMusic gather data around their consumer’s music preferences, browsing behaviours and spending patterns. More importantly, they use this data to improve their customer service. They personalize their user-experience, giving users exactly what they want and need, before they even know they want and need it,’’ he explained further.
Williams said that loyalty programmes are a valuable asset for retailers looking to personalise the customer experience. In the case of Emaar Properties, the company sought to automate its Dubai Mall loyalty programme with the help of Azure Cognitive Services. Shoppers scan a receipt using the mall’s app, which will log their purchases and reward loyalty points accordingly.