WHY APIS ARE KEY TO HITTING "GO" ON OMNI-CHANNEL RETAIL
Credit by: Paul Crerand
Omni-channel retail needs APIs to deliver a sought-after customer experience that leaves cash registers in the past, argues Mulesoft's Paul Crerand.
Retailers have been talking about the benefits of omni-channel for over a decade. By integrating digital and physical touchpoints to create seamless shopping experiences, they can in theory foster deeper customer loyalty. However, practical attempts to drive these projects have been piecemeal at best and largely failed to capture the popular imagination. That was until Amazon promised to revolutionise the retail experience with its hi-tech, checkout-free store concept.
Amazon sets the stage
On paper, Amazon Go could be mistaken for a simple brick and mortar operation, enabling the e-commerce giant to expand into the physical realm. However, its crucial distinction is the "Just Walk Out" shopping experience it offers, allowing customers to leave its stores without needing to stand in line to pay. While that might sound relatively simple on the surface, it's reliant on a lot of technology and data being seamlessly connected behind the scenes to ensure customers are only charged for what they leave with and they enjoy a frictionless shopping experience.
Similar retail experiences are being trialled by UK supermarket chainTesco, where a Scan Pay Go app allows customers to scan and pay for their groceries in-store via their mobile devices. In addition, the Co-op rolled out a "shop, scan and go" service that enables a similar checkout-free experience. And earlier this year, Sainsbury's joined suit with a smartphone app supporting what it claimed to be the UK's first till-free store, but recently pulled back from a wider rollout after it experienced long queues of customers waiting to pay for their groceries at the helpdesk.
It's the data, stupid
As Sainsbury's recent experience has shown, progress hasn't been without its setbacks and even Amazon hasn't been able to expand beyond a few small stores in four major U.S. cities. Why? It's certainly not because customers don't have the appetite for "Just Walk Out" shopping. In fact, MuleSoft research reveals that 60% of global consumers would prefer to shop via an Amazon Go-style experience. The figure jumps to 77% for 18-34 year olds. Even among the older (55+) generation, over two-fifths (42%) of respondents say they'd prefer a "Just Walk Out" experience.
What's more, consumers are not as squeamish about the privacy implications of being monitored in-store as one might think. More than half (53%) of consumers say they're willing to allow retailers to track their shopping behaviour both in and outside stores, especially if it means they're able to receive personalised offers and promotions.
In reality, the roadblock to faster progress for these next generation omnichannel retail experiences is technological. Such systems require a unified view of each customer across a retailer's entire business. That means everything from a consumer's online and offline shopping history, to browsing preferences, to their current location. If retailers are to add true value for consumers, such systems have to not only track items and customers as products are put in individual baskets, but also analyse past purchasing behaviour to offer real-time information, offers and suggestions as they walk through the store. Rolling this out on a grand scale is proving difficult, as retailers struggle to deliver a truly connected omnichannel experience.
Joining the dots with APIs
API-led connectivity holds the key to overcoming the challenges that retailers have faced in making "Just Walk Out" shopping a reality. For too long, retailers have relied on getting to know their customers by pulling data from multiple siloed systems and placing it into a monolithic data warehouse. However, with each individual system updating continuously, this information is typically out-of-date as soon as it's reached the centralised database, impeding attempts to drive seamless, personalised shopping experiences in real-time.
APIs help overcome this challenge, enabling retailers to build an application network that serves as a kind of connectivity layer binding mission-critical data stores and assets, whether they're located in the cloud, on-premises or in hybrid environments. As a result, mobile applications, websites, IoT devices, CRM applications, and ERP systems like order management, point of sale, inventory management and warehouse management can all be integrated seamlessly.
A more connected retail experience
By unifying connectivity and orchestration services through an application network, retailers finally get to realise that elusive vision for seamless omnichannel experiences. Think of it as employing the same principles as a Service Oriented Architecture (SOA) approach, except updated to become more agile. Experiences are linked through plug-and-play functionality and reusable building blocks, helping to future-proof retailers, as new services can be added easily over time.
Organisations are already using this application network approach to reuse capabilities, integrate applications and processes and scale globally. Sports retailer Decathlon, for example, used this model to integrate its cloud-based order management system with a mobile POS and cashless payment process in an effort to enable a checkout-free shopping experience for participating customers.
As more retailers come to embrace this new application network approach, they'll quickly realise that it holds the key to overcoming the struggles associated with siloed systems and fragmented databases. By connecting their digital ecosystems more seamlessly, retailers will lay the foundations to make the Amazon Go experience a reality and can truly start to enjoy the rewards from providing more personalised experiences that drive customer loyalty and boost sales.
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