Delivering fresh customer experiences by embracing intelligent retail

Retail has always been an industry fueled by change. That’s even more true today, when the whims and desires of customers can change at the speed of a tweet. The most successful retailers are obsessively customer-focused.

Today, that means understanding that everyone with a smartphone has a shopping mall in their pocket, and retailers need to really anticipate what their customers want – then deliver it when, where and how they want it. All at the right price. That heart-and-soul focus on the customer – and the rapid change that comes with it – is what I love about retail.

Shelley Bransten, corporate vice-president, Retail and Consumer GoodsAt Microsoft, a huge part of our customer focus is helping our retail customers gather, analyze and use data to build a hyper-focused picture of their customers, then understand how best to reach them. On the other side of the equation, it’s about empowering the retail workforce, giving them the tools they need to delight customers and keep them coming back. And smarter supply chains help ensure the right customers get the right product, at the right price, at the right time.

It’s all about using intelligent technologies to help retailers transform their companies and create fresh customer-obsessed ways of doing business. I believe there are four key areas that retailers must focus on in order to provide these great customer experiences. And it doesn’t matter what a retailer sells or how large (or small) they are – the potential for transformation has never been greater. It’s exciting, and it’s filled with opportunity.

Know Your Customers Better than They Know Themselves

We’ve established that I’m a fan of reimagining things. So it may not surprise you that I’ve rebranded “AI,” in my mind, at least. For me, it’s not so much “artificial” intelligence as “augmented” intelligence. Because, for retailers, it’s really about tapping into data – their own and from third-party sources – and using it to understand their customers better and anticipate their needs.

Take, for instance, Nielsen Connect, a service that taps into Nielsen’s massive amount of third-party data on consumer products sales, pricing, e-commerce, media buying and other things, and combines it with retailers’ own data in the Microsoft Azure cloud platform. The solution uses data science and machine learning to curate and aggregate data and feed it back to retailers. And when you layer in predictive analytics, we bring retailers that much closer to divining what customers want. When retailers augment their intelligence with these technologies, they can make smarter decisions that turn data into dollars.

Empower Your Employees to Provide the Best Customer Experience Possible

Empowering employees with intelligent retail technologies improves operations from the warehouse to the showroom to the C-suite. It’s about understanding that every retail employee is a brand ambassador, so supporting them with technologies that help them do their jobs better creates better customer experiences. This is an area I think is especially ripe for innovation, which is why I’m excited that we’re investing here with our Modern Workplace solutions like Teams for Firstline Workers, which we announced last week.

Many of our customers are already empowering their employees with a more modern workplace and other intelligent solutions. Kroger’s new connected experience stores include a “pick-to-light” employee productivity solution (Kroger’s term for how its store associates collect items for online orders), that reduces the time it takes to fulfill online orders by 50 percent – helping to get orders into the hands of customers faster. And in the showrooms of Italian luxury brand Stefano Ricci, employees are armed with customer purchase and preference data that helps them provide the kind of white-glove customer experience its high-end shoppers expect.

Equip Your Supply Chain to Anticipate and Exceed Customer Demand

We can’t talk about reimagining retail without touching on supply chain. After all, it’s what ultimately keeps customer experience humming. Consider this from AdWeek’s holiday shopping stats: Nearly 80 percent of online shoppers who experienced an item being out of stock defected to another retailer’s website, and 55 percent of consumers have stopped shopping with a retailer because a competitor offered a better selection.

These are supply chain issues, plain and simple, but the actual impact is on the experience your customers have when shopping with you. Reimagining your supply chain means using data to anticipate what your customers will need and where they’ll need it before even they know. This is exactly what Fruit of the Loom did when it started using weather data and predictive analytics to ensure its retail partners were well stocked with fleece products ahead of a cold spell. It’s a great example of using intelligent solutions to anticipate customer needs – and I’m sure those retailers won the loyalty of customers who were able to get their hands on a cozy fleece just when they needed it.

Another great example of this is Starbucks; the company is using Azure Sphere within select equipment to give its partners (employees) more opportunity to engage with customers. This includes everything from beverage consistency to waste reduction, the management of energy consumption and predictive maintenance.

Reimagine Retail to Create New Experiences

We use the terms “omnichannel” or “unified commerce” in this industry a lot, but, frankly, it’s just jargon. Shoppers don’t care about “channels,” they just care about getting what they want, when they want it, and at the price they want. That’s it. It’s just shopping!

Though exciting for consumers, this presents challenges for retailers. I’ve heard from many retailers who are frustrated at seeing customers walk into their store to see and touch a product, then pull out their smartphones to find the lowest price or even purchase the product from a competitor right there in the store.

So what if you could get ahead of that with smart displays that use analytics to adjust the numbers in real-time based on available data and offer flash deals that match the best price at popular online retailers? By making it easier for the customer to buy, you keep the sale in the store and build loyalty to boot.

This isn’t some future scenario. America’s largest grocery retailer, Kroger, has partnered with Microsoft to reimagine the grocery shopping experience using Microsoft Azure, AI, cognitive services and other intelligent cloud technologies.

Kroger’s latest generation of EDGE Shelf — which stands for Enhanced Display for Grocery Environment — uses Internet of Things (IoT) to send information to and from the cloud. LED displays (instead of traditional tags) indicate everything from prices and promotions to nutritional and dietary information. The elimination of paper tags means that Kroger can be extremely nimble when it comes to pricing – whereas it used to take days to update a store full of price tags, now it can be done in minutes.

And EDGE Shelf is bringing together digital and physical experiences for shoppers as well. The smart shelf lights up when a customer is in range, letting them know where to find the next item on their digital grocery list. And the store can customize promotions right on the spot based on the customer’s previous purchases.

What Are You Waiting For?

The bottom line is that retailers can’t afford NOT to reimagine retail. Digital transformation isn’t just some tech buzzword, it’s how retailers will survive, thrive and win moving forward. When a customer has a great experience with you, they are more likely to keep shopping with you online, via mobile or in the store. And maybe all at the same time. With their items in your shopping cart.

Don’t Miss These Sessions if You’ll Be at NRF in New York this Week

Chris Capossela, our executive vice president and chief marketing officer, will lead a session highlighting the importance of brand and how your brand can differentiate itself by reflecting your unique mission and culture. He’ll talk about how Microsoft’s mission to “empower every person and every organization on the planet to achieve more,” coupled with a growth mindset, has led to an evolution of the Microsoft brand to reflect the new mission and culture. Catch Chris on Tuesday, Jan. 15 at 11:30 a.m. ET on Stage 3 of EXPO Hall, Level 1.

We’re also excited to participate in two Women Rocking Retail panels on diversity and inclusion in the workplace, in The Girls’ Lounge at NRF. Monday, Jan. 14 at 1:30 p.m. ET, I’ll be discussing mentorship, and on Jan. 15 at 1:30 p.m. ET, my colleague Alysa Taylor, corporate vice president, Business Applications and Global Industry Marketing, will talk about developing a personal brand.

Shelley Bransten is corporate vice-president, Retail and Consumer Goods.