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The retail industry has been through massive changes over the past five or so years, including global supply chain disruptions, shifting priorities for in-person and online shopping, and—no surprise—the integration of cutting-edge technologies like AI. This means BIG CHANGES to the industry! So, what are some of the biggest challenges and opportunities retail is facing? I had a great conversation with retail expert and President of IHL Services, Greg Buzek, to find out.
Omnichannel to unified commerce model
When looking at the state of the industry, we both agreed that one of the major retail trends of 2024 is unified commerce. Right now, many organizations run multichannel operations, meaning customers can access a company both in person and online. This level of access can expand a company’s reach to a wider audience but often leaves data siloed and customer experiences disconnected. Luckily, organizations have the tools to improve this system and shift from multichannel operations to unified commerce.
In essence, this approach connects the silos formed in a multichannel method, providing businesses with a single, overarching view of their operational data and offering a seamless, consistent experience to both employees and customers. Take Lucky Brand as an example, working with Amperity on Microsoft Azure, which utilized this approach to unlock the power of its data. Using Amperity, Lucky Brand uncovered valuable data hidden within 12.7 million records, allowing them to attribute $192 million in lifetime value to 1.5 million previously unknown customers!
The impact of this sort of transition can often be felt across an organization. Simpson Strong-Tie, with the help of Microsoft partner Optimizely, has seen significant benefits from unifying its data for B2B e-commerce. This solution powering sales to big box retailers brought with it a monthly average of $100,000 in sales and an 18% increase in unit sales.
Not only does this approach transform operations end-to-end—from supply chain to fulfillment to the physical storefront—but it also merges the shopping experience for customers across all platforms. It’s why DICK’S Sporting Goods worked with Microsoft to develop a more consistent experience between online shopping and its 850 physical storefronts. Whether a user is ordering from an online shop or checking out in person, unified commerce ensures a consolidated, frictionless transaction. As Greg succinctly put it: “It’s not just e-commerce, it’s just commerce.”
Our partners and customers are turning to unified commerce to empower their employees, delight customers, and prepare for future growth!
Generative AI as part of digital transformation to unified commerce
One of the major technological developments on many retailers’ minds? Generative AI. These solutions can transform retailers from end-to-end, offering everything from increased efficiency to enhanced personalization and operational agility.
When you consider what retailers have been facing the last several years—a pandemic, supply chain delays, and ongoing political unrest across the globe—it’s no surprise that a tool like AI would make it into the toolbox of any organization looking to adapt to whatever 2024 (and beyond) throws at them!
One notable (and previously mentioned) area ripe for AI integration is unified commerce. Since unified commerce is about gathering data in one place for easy access, AI capabilities help exponentially enhance those data sets. You’re basically giving an AI solution access to an “all-you-can-eat” array of data, which provides improved insights across operations.
When considering how to leverage AI, our customers often find it easiest to start with small deployments and thoughtful experimentation, which can go far in the long run. I love Greg’s advice: “When you think through it, you want to start with the best data. You want to start where you can achieve the best bang for your buck.”
As for AI in action, you better BET our partners and customers have been jumping at the chance to harness this phenomenal technology! Recently, Walmart teamed up with Microsoft to integrate generative AI into its search function, helping consumers reduce the time they spend every week managing shopping and general household planning. Meanwhile, the largest pizza company in the world, Dominos, is harnessing solutions like Microsoft Azure OpenAI Service to modernize storefronts, empowering employees and customers alike!
As technology rapidly evolves, I’m sure we’ll see even more incredible examples of digital transformation at work in the future.
Making More Possible
Technology is transforming our industry landscape, and customers look to Microsoft and our partners for guidance. I’m proud of the collaboration with our partners to empower clients with AI and cloud solutions to meet their needs across the entire retail process. From boosting efficiency to enhancing user experience, unified commerce really is the retail solution of the future!
Want to learn even more? Explore industry trends and expert insights from some of our influencers, including Brandon Rael, Chris Walton and Anne Mezzenga, Ron Thurston, Incisiv, Cathy Hotka, and more from the wonderful Greg Buzek! You can also follow Shelley Bransten, Corporate Vice President of Global Industry Solutions at Microsoft, for gems like this post on #MSPartner Domino’s, and listen to Ricardo Belmar’s The Retail Razor Show podcast.
Whether you’re just starting your digital transformation journey or are in the middle of development, we’re here with the support and resources to help you reach your goals:
- Dive into Microsoft retail developments.
- Discover the power of Microsoft Cloud for Retail.
- Find a Microsoft partner.
- Learn how to become a Microsoft partner.
