The future of retail will be powered by brands that bridge e-commerce with offline, mobile, and online to create a seamless digital real estate.
To state that 2020 was a watershed moment in India’s retail industry would be a gross understatement. According to a recent report by BCG and Retailers Association of India, while brick-and-mortar sales in the country registered a degrowth for the first time in decades, e-commerce sales zoomed ahead by a whopping 28%. This was largely triggered by the COVID-19-induced restriction on movement. The uncertain economic environment forced businesses to improvise, and their ability to adapt to the new reality and innovate new business models has become a matter of survival.
Given the changes in consumer preferences, buying habits, and convenience, this trend is unlikely to be reversed in a post-pandemic world. This switch from physical stores to digital stores, and the changing business models has brought into focus the concept of digital real estate.What does this mean for retail businesses and what does the future look like?
What is digital real estate?
In its most basic form, digital real estate can be described as any non-physical, point-of-sale where consumers can make their purchases. In the early days of e-commerce, this largely meant having a website with payment capabilities. However, like Amazon, Airbnb and Uber have demonstrated, a robust digital platform can deliver a superior user experience, and a lot more.
Digital real estate is not just a digital storefront, neither is it just an IT infrastructure that sits at the backend. It is an all-encompassing initiative that connects the website and mobile app, as well as offline stores, shop floors and warehouses. The democratization of technologies such as AI/ML, 5G, IoT and sensors enables enterprises to create an integrated digital real estate that brings together an entire ecosystem that can make businesses resilient, agile, and responsive while delivering a friction-less customer experience.
Enterprises that invest in strengthening their digital real estate and integrating the customer experience with operational aspects using technology can help reap the following benefits:
- Know what the customers want: A digital environment by definition is a data-rich environment. Deploying a customer data platform that captures a customer’s behavior across channels such as digital, social, offline and can help businesses sequence together a contextual customer DNA to understand what they want and prefer. Additionally, a layer of analytics can help generate persona-based insights which can be used in a predictive and/or prescriptive manner to deliver highly personalized experiences.
- Deliver a seamless omnichannel experience: Today, customers live in a multidimensional world with online and offline elements including the internet, websites, mobiles, multiple apps within mobiles, and the traditional brick-and-mortar store. These are unique channels unto themselves and depending on their preference, customers could visit any or all of them. In such a scenario, investing in digital real estate enables businesses to deliver a seamless omnichannel experience.
- Engage with customers throughout the purchase journey: Knowing what the customers need and helping them discover what they’re looking for is an important aspect of customer engagement.Digital asset management tools can be deployed for targeted marketing and inching towards closing the loop. From a business perspective, the completion of a transaction is perhaps the most critical aspect of a purchase. And in a digital-first world, response time and latency can be a deal-breaker for customers. Joining these various dots through a responsive digital ecosystem can help brands engage better with the customers throughout their purchase journey.
At the end of the day, the essence of retail business can be distilled down to one point: knowing what the customers are looking for and delivering a hassle-free experience through their purchase journey. And as we have seen, digital real estate is not just about e-commerce, it is equally important for brick-and-mortar retailers, and it has as much operational utility for enterprises as it has for consumers.
Emerging technologies blend convenience with interaction to discover and engage customers. So, as businesses start or accelerate their digital transformation, the key lies in investing in these technologies and integrating them with a robust digital real estate platform. The future of retail will be powered by these twin engines and the success stories of tomorrow will most likely be brands that bridge e-commerce with offline, mobile, and online to create a seamless digital real estate.
(Rajesh Varrier, SVP, Head of Digital Experience & Microsoft Business, Infosys and the views exprssed in this article are his own)