Reinventing Retail With Cognitive Retail Computing
Retailers predict that only through personalization can they distinguish themselves from the crowd. That said, today’s customers leave their digital footprint in various forms such as images, videos, voice and natural language across different channels. For retailers, cognitive computing is the logical process to invest in to provide personalized shopping experiences that increases their value add and revenue, for getting a single view of consumers across channels irrespective of the touch points.
Opening up new avenues for data capture, cognitive retail computing ensures digital transformation in the retail sector that’s redefining the customer experiences. The proliferation of technology advancements in cloud computing, e-commerce, m-commerce and big data analytics enable retailers gain insights and achieve incremental value.
Retail Brands Given New Direction with Cognitive Technologies
Tracking customer behavior, expectations and experiences by the traditional method of using analytics is tedious, unreliable and cumbersome. It mostly relies on historical data whether online or in-store to deduct insights.
Cognitive retail computing instead relies on real-time data to process and provide actionable insights. It’s one of the retail industry strategies driving for a healthy bottom line. Cognitive Systems utilize dialogue oriented natural language interfaces and machine learning algorithms to provide knowledge enabled processes and to mimic decision-making capabilities like humans. They extend human expertise and operational efficiency by intelligently analyzing volumes of data and provide insights and solutions in a fraction of the time it now takes.
According to Fortune Business Insights, the global artificial intelligence (AI) market size was valued at USD 27.73 billion in 2019 and is projected to reach USD 266.92 billion by 2027, exhibiting a CAGR of 33.2% during the forecast period.
Other statistics from IBM Institute for Business Value’s recent report, Thinking like a customer shows the importance of cognitive computing in retail space.
- 91% of retail personnel believe that cognitive computing will play a disruptive role in their organization
- 94% in the future intend to invest in it
Transforming Retail with Cognitive Technologies
Retailers who focus only on the brick-and-mortar stores must be prepared for radical disruptions that digital transformation which leverages Artificial Intelligence, Machine Learning, Big Data and analytics throws at them.
While analytics and Big Data are already changing the retail landscape, the integration of AI and other cognitive technologies will further create optimization of processes, product scheduling, material planning, logistics and supply chain management. On the human personnel end, it will enhance efficiency and productivity with better asset utilization based on real-time and continuous insights.
Cognitive is becoming a profitable investment for retail businesses to expand their existing business models. This cognitive and the omnichannel customer journey begins with
- Consumer data is analyzed and converted into valuable insights.
- Multiple points of customer engagement are identified
- An integrated omnichannel strategy is formulated
- Strategies are intelligently distributed through the omnichannel system
- Consumer data is analyzed and personalization is applied
IBM Watson being the pioneer in this cognitive computing field has enabled many small and medium retail businesses and enterprises to capitalize on this technology.
By focusing on the five specific forces that are changing the retail landscape, brands will be better equipped to bridge the on and offline retail world with customer engagement strategies.
Personalized retail is the trend that’s increasingly becoming omnipresent within the retail landscape. The key to successful retail businesses is using data to create a meaningful customer relationship. Choosing and investing in the right technology matters and allows an increased personalization to drive the long term success for your business.
Expanding customer expectations
Customers are totally empowered through social media and their expectations are continually evolving and expanding. They expect retailers to offer convenient, responsive and personalized services. By controlling the shopping process, they want to discover and purchase products how, when and where they want.
Customers are assuming ever-greater ownership over their personal retail journeys. Customer’s today have various options to discover, compare and buy the products. They are not constrained by location or time to buy their products. Mobile apps and payments, self-checkout payment lanes, price checkers and information kiosks are just few options available for them.
Technology is redefining the ways in which retailers interact with customers. But many of the brands are yet to fully embrace technology. Constrained by Budgets, technical skills and proficiency, infrastructure demands and management guidance/direction for implementation, they are losing out on opportunities for growth and success.
Customers are spoilt for choices with affordable pricing driven by stiff competition and global sourcing. Yet, retailers are facing falling profits due to inflation, economic disparities and increase in realty, salaries and strategic investments. Retailers are also worried about declining customer loyalty and profitability.
Privacy & Security concerns
Customers are anxious about increased cyber-attacks and security breaches leading to identity theft and credit card frauds. Malware attacks on point of sale systems and systems of record are becoming more common.
Cognitive retail is the future that’s driving retail stores both online and offline establishments. Despite the steep learning curve involved by all the stakeholders in terms of implementations, it’s the prospect of diverse benefits that is luring retail stores towards cognitive computing. In this new retail world, the cognitive consumer expects great services at all times. Brands must deliver on such expectations. Cognitive retail affects almost every aspect of a retail business from marketing to supply chain to IT, e-commerce and merchandising.
Retail will keep enhancing customer experiences and acquiring new customers through the latest Cognitive services in the future.