Published on the 05/06/2024 | Written by Heather Wright
Forget the metaverse…
Hyperpersonalisation, retail media and AI are the talk of local retail when it comes to technology, but data security continues to be the issue keeping retailers up at night.
That’s according to Ian Mooney, Fujitsu principal solution architect, retail.
“Retailers are creating a vibrant and dynamic retail landscape.”
Customer experience, however, remains the driving force behind most technology buying decisions in today’s retail sector, Mooney says.
While retailers globally are jumping into the virtual world with L’Occitane launching a virtual experience and Superdrug launching a branded obstacle game on the Roblox platform to celebrate its 60th birthday, or launching ‘immersive’ commerce marketplaces featuring influencer driven virtual shops (Walmart Realm), retailers across Australia and New Zealand are taking a more pragmatic approach, with the hypersonalisation, retail media and yes, AI.
Mooney told iStart there’s been a ‘significant’ surge in the number of retail media end-points, making content scheduling increasingly complex. Enter the next-generation of content management systems, incorporating AI support for scheduling and brokering platforms to commercialise presentation time.
“AI is making a significant impact on almost every facet of retail,” Mooney says. “It’s being used in product design, production planning, supply chain and inventory optimisation, range and price setting, marketing campaign creation, targeting, and labour scheduling.”
He says the strength of AI lies in its ability to process large volumes of complex data and derive meaningful, productive insights.
“It has significantly reduced the time required to calculate ‘what-if’ scenarios, which previously took teams of analysts days or even weeks, to just a few minutes.”
Local retailers are also embracing digital tech to enhance the in-store experience with digital kiosks, interactive displays and mobile apps transforming how customers interact with products and brands.
“Concept stores, pop-up shops, and interactive product demonstrations are creating immersive and memorable experiences that attract and retain customers.
“This focus on experiential retail goes hand-in-hand with the growing trend of supporting local businesses, as retailers collaborate with local artisans and producers to offer unique and locally sourced products. By embracing these trends, retailers are creating a vibrant and dynamic retail landscape that caters to the evolving needs and desires of today’s consumers.”
While the Australian and New Zealand retail markets are ‘strikingly similar’, Mooney says the difference in size is a factor in technology adoption, with New Zealand’s small population impacting budgets available for future business initiatives and IT spending, he says.
That means there’s often greater emphasis on off-the-shelf solutions, rather than in-house developments, or highly customised systems.
“When comparing the retail markets, I often highlight the difference in population between Australia and New Zealand, which is around 32 million, and North America, which is approximately 350 million. This comparison quickly illustrates the impact of market size on the retail sector.
“There’s a fixed cost associated with implementing new technology, which includes aspects like integration and configuration. Given the smaller market size in New Zealand, these fixed costs are spread across fewer stores and consumer sales. Essentially, this makes the establishment of new technology more expensive in New Zealand market.”
As to that issue of data privacy and security, Mooney says it’s crucial for businesses to establish a clear data strategy.
That involves outlining the type of data to be collected and the purposes for which it will be used.
The latest Digital Platform Services Inquiry report from the Australian Competition and Consumer Commission flagged concerns over how much data companies are collecting – and on-selling to other services – noting that many Australians are largely unaware of the issue and the risks involved.
“Regulatory requirements should be considered as the absolute baseline, and this should be overlaid with what your customers expect from your business,” Mooney says.
He urges businesses to regulatory review and update their data strategy to accommodate changes in the regulatory framework and shifts in consumer sentiment regarding the capture and storage of data.
The data architecture sets the ground rules for data sourcing, retention duration, access permissions and, most importantly, data security and maintenance.
“This ensures that your business is not only compliant with regulations but also meets and exceeds customer expectations,” Mooney says.
