Using Technology to Ease the COVID-19 Burden on Retail
Covid-19 has been a phenomenon affecting every sphere of human activity. The retail industry has also been challenged to think in unique and different ways. The pandemic has forced retailers to relook at their strategies due to changing behavioral patterns seen among the customers that were typically known and predictable.With COVID-19 changing the consumer sentiment and lifestyle, it has also accelerated the adoption of technology in this industry.
If we look back, an immediate fallout of the worldwide lockdowns was panic buying of essentials, toilet paper being the famous example. Behind the scenes, this huge short-term demand placed a load on the replenishment of supply chains, by shifting the demand away from planned categories to categories that required different handling capacities and volumes. This led to disruption of supply chain strategies along with imbalance in the spread of goods sold in the distribution centers.
Many demand forecasting systems in place were observed to be out of sync with reality.Data scientists worked on making short term adjustments to their models to accommodate essential product categories for all the customers and adapting to changing strategies in their modelling workflows for better efficiency.
In some instances, governments reached out to retailers to frame strategies to provide priority retail access for vulnerable populations. The challenge was to determine who are the vulnerable population, for which better data needed to be sourced and then analytical models had to be devised to ensure correct targeting. Methods used for better marketing were repurposed to identify and support such customers segments.
In addition, AI was also used to make the delivery process seamless and as contactless as possible. Even in-store, there were efforts made to analyze images to identify products that were handled by people and advise sanitization of products and areas.
The pandemic has made buying online more in demand than it has ever been, and retailers have started looking at improving sales using innovative ways such as providing virtual trial rooms and video-based sales calling.
Another key hurdle for retailers was to rethink the way their retail channel strategy was positioned. This has led them to question their channel-merchandising positioning and deciding on maintaining the right number of physical stores.
Retailers are now using control based causal inference studies and pattern mining techniques to come up with strategies to mitigate these challenges. The focus has now increased on creating a unified shopping experience across different merchandise channels. With this the integration between offline and online retail is likely to grow further.
The Indian retail market have now realized the need of technology driven modern supply chain solutions to create an omni channel experience of shoppers. As retail leaders strive to shed outdated strategies, the industry collectively responds with innovation and technology to unlock the new next.
This year has created a digital revolution and accelerated the need to get closer to the customer. Systems that supported the online businesses came under a lot of pressure to handle the increased load. To overcome these, retailers across India have started investing heavily in cloud infrastructure as opposed to an in-house infrastructure. Retailers of all sizes have fast tracked their decisions in accelerating their cloud strategies due to the pandemic.
According to an IDC survey, more than 60 per cent of the Indian organisations plan to leverage Cloud platforms for digital innovation. This clearly states that switching to cloud enabled technologies will be beneficial and equally important for retail businesses in India.
Looking ahead to 2021 and beyond, technologies like AI/ML, data analytics, blockchain, will help retailers provide the best shopping experience for customers. AI will play a key role in understanding customer spend patterns and preference to figure out lasting changes, especially related to channel-product category preferences, delivery options, store visit timings, etc.
Technology will also help in enabling smart baskets which will mimic the impulse spending behavior in stores and will help retailers predict the buying decisions of the customers. These are very interesting use cases that have been thrown up by this pandemic and technology will play an important role in tackling all of the them.
(The author Abin Abraham, Staff Data Scientist – DS&I, Walmart Global Tech India and the views expressed in this article are his own)