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The expectations that consumers bring to a shopping experience are constantly evolving.
Look at the last three years: People shopped more online during the height of the pandemic. They became accustomed to the selection and access to different brands offered by ecommerce. There was a wider return to stores last year as restrictions lifted, but digital tools remained key to the shopping experience. Shoppers don’t think twice about conducting research online before checking it out in-person, or ordering an item on their phone to pick up later.
Shoppers are comfortable moving across channels. According to the Connected Retail Report from CI&T, consumers are splitting time almost evenly between channels – 48% online, and 52% offline. Even as they toggle between mediums, they want to have similar experiences in both. The report found that 86% of respondents have the same expectations across channels.
As CI&T Chief Strategy Officer Young Pham put it, shoppers want an immersive experience.
“People are starting to realize that their behaviors have changed,” Pham said. “So for retailers, the opportunity is, ‘How do I meet that behavior?’” The lesson for retailers is that they must not return to a time when they didn’t anticipate those changes taking place.
It requires examining what elements work in a specific channel, and how they can be applied across both. That means there is room for ecommerce to apply some of the advantages of the store. Online shopping can be transactional, but it can learn from how the store excels at merchandising, and guiding them through the store.
Where associates may ask questions to understand a person’s needs and show them products, digital tools can make recommendations and personalize the shopping experience. Where there may have been an in-person bike road test or makeup try-on, user-generated content sourced from social can help to show a product in action. A dynamic video could replace a window display.
Increasingly, there is also room to work across channels. Store associates with downtime can help to assist customers online through virtual consultations.
This approach has changed how retailers set up the foundations of ecommerce, such as checkout. Now, Pham said there is also room to bring composable architecture to how retailers build the experience of shopping online with elements such as personalization and user-generated content.
To do so, CI&T partnered with digital experience provider Crownpeak to launch the Retail Experience Platform. Combining CI&T’s experience in the retail industry and digital transformation with Crownpeak’s technology, the organizations are building retail management accelerators to expand access to composable commerce for specialty retailers. While many enterprise retailers are embracing composable, CI&T and Crownpeak see room to grow this approach in the middle market.
A personalized tech stack
This shift has all kinds of implications for the technology and infrastructure that powers commerce. The pandemic brought rapid digital transformation, especially at specialty, mid-size retailers. Bike shops that were destinations for Saturday shopping had to ensure they had online offerings to continue to reach customers, too.
Ecommerce tools were moved into place seemingly overnight, and in-store systems were configured to allow for modes that moved between the channels, such as pickup. But now that patterns have settled back out, there is room to think about how brand extends into the way that people move through an ecommerce store.
“I want to spend more time now thinking about, how I can have a better customer experience…How do I create a relationship?” Pham told The Current on the floor of the NRF Big Show.
Change will be a constant. The digital tools that allow this to happen will continue to evolve, just as expectations do. It requires an architecture where brands and retailers can choose the right technologies that allow them to reach customers, and deploy quickly. It means they may mix the best tools from different tech providers, and change them out as new tools come along.
Known as composable commerce, this represents a shift in ecommerce software. Previously, ecommerce systems for retailers were often custom-built and frequently monolithic. Changing out individual parts often required rebuilding whole systems. But the arrival of the cloud, API-driven technologies and headless content management has brought about the ability to create an interchangable stack of best-in-class technologies that is personalized to the retailer.
'Adjust, adapt and grow'
The shift to composable architecture can bring change on two levels, Pham said. Technology capabilities that will be advanced, and Crownpeak specializes in this area.
“Having the right technology in place that can adjust, adapt and grow with the needs of the customer over time is what we bring to the table,” said Crownpeak Chief Marketing Officer Michael Robinson. “We provide the ready-made building blocks and the right tools to create something that fits to the customer's needs.”
But there are also business considerations. On an organizational level, retailers will be able to use composable architecture adopt new features that can change the shopping experience for customers, and do so in a way that provides flexibility to pivot and improve. This involves not only the internal teams that will prioritize and design experiences, but also suppliers that must move products into place. This will bring a shift internally, and there must be a willingness to embrace it.
“The speed to market is the ideas. It's not the technology,” Pham said. “If you want to look at how you're changing your commerce journey, it's not a whole revamp for a year.” By being able to componentize with composable commerce, “I'm talking weeks and months, versus years,” Pham said.
Once the initial components are in place, the technology allows retailers to grow as these experiences become more common.
“It also allows you to scale,” Robinson said. “If you think about more personalization, more variants of content, different stories, and how you would like to reach out to different audiences, this requires the necessary tools to deliver these experiences.”
In the end, it underscores a mindset shift taking place. New technologies are continuously launching, and consumers are expecting the capabilities they provide to be embedded in the shopping experience. Retailers must be aware of what customers want to use, be able to adapt their technology quickly and integrate it into one dynamic path that moves across in-store and digital channels.
Trending in Shopper Experience
Microservices architecture allows the company to give retailers ownership over omnichannel software.
With the growth of digital commerce, providing consumer choice is at the center of all of a retailer’s operations.
In recent years, that became especially evident in the area of fulfillment.
Ecommerce made the process of moving an order into place for delivery a crucial function, as the ability to source products close to demand quickly was an imperative.
“Retailers are looking to own more of their fulfillment destiny because consumer expectations have increased,” Chap Achen, VP of product strategy and operations at Nextuple, told The Current on the floor of the NRF Big Show 2023. “Fulfillment is now a competitive weapon.”
As digital operations increasingly blend with the physical store, a host of new fulfillment options are coming online. They can have an item delivered from the store on the same day, or they pick it up. Even a wider offering such as in-store pickup has a host of different choices inside of it. Consumers can pick up an item at a counter, or a locker. They can stop by anytime, or schedule a pickup on Saturday.
While this optionality helps retailers meet customers where they are, it also adds complexity to the systems that run them, and requires operational adjustments to put them in place.
It means the software that powers fulfillment operations must also meet retailers where they are, Achen said. Many retailers have specific setups and processes. They may have a store located in a mall with a nearby distribution center, or a series of small storefronts. At the same time, retailers need to have flexibility with the software that they use so they can provide options to consumers.
For Nextuple, the vehicle to provide this is microservices, which describes a software architecture in which the parts of an application work independently, but are also built to work together. The company harnesses microservices to offer an ownership-centered approach to deploying its software through a product called Nextuple Fulfillment Studio.
“Today, there are only two ways to buy software: [software as a service] or custom building,” Achen said. “You can do it yourself or with a partner. We are a third option. We will help you accelerate your time to market because we've already developed 80% of your requirements, and then we'll give you that as source code.”
The software is composable. Retailers own the source code, and they can iterate. Along the way, they have the ability to swap out components of the software for pieces that enable them to better respond to the needs of customers, if they choose.
It shows how composable commerce is spreading throughout retail operations. A first wave of development applied the approach to the “front-end” of commerce, such as operating an ecommerce store and marketing. With fulfillment software such as Nextuple coming online, there are signs it is being applied to backend operations, as well.
In all, Nextuple offers 14 microservices as part of the Studio, including engines for same-day delivery, storage, inventory management and sourcing.
At the NRF Big Show, Nextuple announced that it is live with five national omnichannel retailers. Together, they have $50 billion in annual revenue and 7000 store locations.
The company is aiming to serve a group of retailers that are widely known, but still looking to hone operations for omnichannel retail. When it comes to fulfillment technology, the retail landscape has distinct tiers.
The largest players have built their own fulfillment tech to power logistics networks that reach across the country.
Name brand retailers with a national presence also want to offer competitive fulfillment, but haven’t made the move to acquire platforms or developed their own software in-house. Typically, they would seek out a software provider that offers a set platform on a subscription model. But the particular needs of commerce require software that powers physical operations with digital tools. That requires a different type of solution, Nextuple believes.
“We want to level the playing field,” Achen said. “We're helping the mid-tier [retailer] compete with Target, Amazon and Walmart.”