The pandemic had a lasting impact on the retail industry and challenges remain. Facing high rates of inflation, continued staffing shortages and an increasingly digitized world, retailers are seeking new ways to attract and retain consumers.
On the eve of NRF 2023, the National Retail Federation annual conference and expo, we spoke with Kayla Broussard, Kyndryl’s CTO of Consumer & Travel, about the state of the industry and the innovative solutions her team has developed to meet retailers’ needs.
Retailers have faced challenges since well before the global pandemic. What’s driving the need for IT innovation?
Inflation, a labor shortage and changing expectations are top of mind for everyone, and the retail industry is no different. Not only are retailers managing the constant price changes, but existing staffing shortages make it difficult to keep up and reflect the accurate prices in-store, which can result in lost revenue. Hiring and retaining talent also continues to be a pain point along with the changing consumer demands for augmented and connected experiences between the physical and digital worlds. As innovations such as IoT and smart technology become commonplace in our day-to-day lives, retailers are finding they must evolve to meet those demands and embrace technology, such as live scan and intelligent dressing rooms that provide “try-before-you-buy” options. And finally, there are concerns around data — CIOs are seeking ways to ethically capture consumer data and leverage it to make a difference on their bottom line.
It’s safe to say everyone’s online shopping habits have increased in recent years. How concerned are retailers about distribution and fulfillment?
With the e-commerce boom and consumer expectations for instant gratification, both have created major hurdles for retailers. One thing we’re consistently hearing is that last-mile delivery — or the last stop of a shipment’s journey before it reaches its destination — is eating away at profit margins. And for small- and medium-sized retailers, those margins may already be razor thin. Fulfillment poses its own unique set of challenges, and retailers must be smart about when and where they’re pulling inventory from. For example, a clothing store may be able to ship a customer a sweater from a store located in their area to save on costs. But is it worth pulling that sweater from the shelves if it’s a best-selling item and drives store traffic? Also, with multiple delivery options at your disposal, how do you fulfill consistent delivery promises which is crucial to keeping loyal consumers? These are all questions and insights we’re working closely with our customers to unpack and develop solutions for.
Let’s look at ways Kyndryl is helping retailers. What are some solutions you’ve put into the market?
We’ve developed three key offerings to address these challenges — all of which we’ll be showcasing next week at NRF within our interactive booth. First is Dynamic Digital Signage, which provides meaningful consumer engagement versus traditional paper displays or Electronic Shelf Labeling that allows retailers to adjust pricing right from their keyboard. Again, prices are changing so rapidly, so this removes the need for someone to manually swap out price tags in store, along with providing product traceability.
We’ve also rolled out Predictive Inventory Management solutions, which give retailers more visibility and data-driven insights into their inventory. It allows them to maximize operating margins while creating efficiencies around accurately processing returns during peak times, such as in January when there’s an influx of holiday returns. And finally, we’re helping shape future retail with the development of the Intelligent Warehouse, which streamlines operational efficiencies and helps reduce costs through automation and smart devices, such as RFID tags for product tracking and smart glasses for vision picking. Another example within the Intelligent Warehouse solution set is where retailers can monitor and control temperature and humidity using IoT devices, and accurately forecast incoming and outgoing inventory — all of which minimize product loss.
How can technology also help retailers retain employees?
Retailers have long understood the importance of optimizing the consumer experience. However, ensuring employees have a positive experience is arguably just as important, especially since companies that have committed and motivated employees statistically out-perform those that don’t. We’ve supported several customers as they adopt new technologies, such as in-store mobile devices with real-time access to data that empower their teams to be more agile and effective on the sales floor — this is crucial since the vast majority of shoppers say that product knowledge is what they need most from a sales associate. This ultimately makes it easier for employees to execute their job, provide hyper-personalized recommendations and improves their experience while doing so. Our customers have found that when they make IT investments that enhance the employee experience, it helps retain talent longer and aids in attracting new talent.
You mentioned that retailers are dealing with data challenges. Tell us more about that.
Today, CIOs are looking for a holistic end-to-end view of their data. They’re coming up with strategies to deal with data that’s historically been siloed perhaps within a line of business. Our teams are constantly having conversations on the ethics of data as well, and we’re addressing questions on how to modernize, collect, cleanse, organize, analyze and infuse the data. Retailers are also using third-party data to understand what consumers and influencers are saying about a company or product on social media.
Speaking of data, what will you be unveiling at NRF alongside WOW Concept CEO Dimas Gimeno?
Our work with WOW Concept is centered around enabling them to become a data-driven enterprise built around phygital processes. WOW Concept was “born on phygital” — that is, an immediate, interactive, immersive and hyper-personalized shopping experience where you infuse the best of the physical in-store and digital online worlds. We’ll be talking about how we’re helping them to secure and leverage data as a strategic asset “to record every interaction in both channels (online and offline), measure consumers’ behavior, product interest and staff performance.” I’m excited for other retailers to hear about this straight from the source, as again, Dimas Gimeno and his team have been leading this movement with Kyndryl as their trusted collaborator.
Attending NRF? Visit Kyndryl’s booth (#4141) in the Jacob K. Javits Convention Center and attend these sessions hosted by Kyndryl executives:
- Sunday, January 15 at 11:45 a.m.: Let’s Get Phygital: Effectively Connecting the Storefront and Digital Shopping Experiences hosted by Kyndryl CTO Kayla Broussard and Wow Concept CEO Dimas Gimeno
- Monday, January 16 at 4:00 p.m.: Responding to Black Friday Peak hosted by Kyndryl France President Philippe Roncati, Kyndryl US President Amy Salcido and Fnac Darty Director of eCommerce and Digital Oliver Theulle