All industries can learn from the retail sector's work with artificial intelligence, and explore how AI can define product and service offerings while also improving the customer experience.

Guest Commentary, Guest Commentary

December 3, 2018

5 Min Read

We know the key to success in the retail industry is to provide goods and services that consumers desire or need. It sounds simple, but the reality is that a lot of intelligence – both human and machine – and action goes into understanding what consumers really want or need to buy and when.

As a result, the retail industry is leading the way in utilizing the analytical power of digital intelligence to supplement and augment their human workforce. Other industries can learn lessons from the retail sector’s experience in shaping a blended digital and human workforce to achieve both an improved customer and workplace experience.

Go back to the basics with data

Incorporating AI into business starts with clean and trusted data. Take a look at Amazon, best known as an online shopping giant. Amazon is a digital native retailer and started with very little technical debt. This enabled it to move quickly and create unique customer experiences with data that could be cleaned and used quickly. Using what now are trusted transactional analytics, they have the confidence to create physical locations, providing more tailored and unique experiences for their customers based on extensive knowledge, knowledge of what their customers are interested in buying after years of gathering detailed purchase history and demographic details.

Similarly, Wal-Mart is recognized as a brick and mortar retail behemoth, yet they are seeing significant sales growth from their website, through their acquisitions of higher-end digitally successful brands like Bonobos and Jet. They also are seeing growth on the grocery front, similar to Amazon’s Whole Foods acquisition, but differentiated by convenient experiences for their customers such as order online and curbside pickup services. It is through their intense use of data and analytics that they were willing to make such bold bets. Those bets are paying off.

Today, organizations have a lot of latent data from both physical and digital sources, as well as intelligence derived from their partner ecosystem, which presents a huge opportunity. Once that data is cleaned and understood, it can be used in a trusted intelligence system to better take on the competition.

Create experience experts

Retail is seeing the revolution of experience showrooms;  Casper and Bonobos are great examples. To continue to differentiate, stores are employing a new type of employee: the experience expert. They exude the brand and can tell the story, the history, and are deeply familiar with how the products are made, where they are sourced, and they can help the shopper find exactly what he or she wants. A retailer can have the most high-tech showroom, but without a gratifying human interaction to create a smooth transaction and modern workplace tools that enable this kind of brand pride and customer service support, the sale is most likely not going to happen.

The retail industry has always experimented with ways to blend physical and digital "talent" to create a workforce that makes human interactions better with the goal of converting every customer into a loyal and high-end client. For example, Stitchfix has AI and algorithms baked into virtually every component of their business, but also uses human employees with the power to overrule the algorithms based on their experience and expertise. A blend of digital and physical across all elements of the business – from call centers to consultants to sales – enable organizations to be more intelligent and nimble, while also creating more cohesive and positive experiences for customers, partners and employees.

This ecosystem strategy builds trust and loyalty at all levels, helping to attract and retain not only customers but also the most passionate workforce and innovative partners.

Invest in employee experience first; customers will follow

Elevating the customer experience is hugely important and the innovation there will never cease, but the savviest companies have realized that customer experience isn’t enough. Data from The Massachusetts Institute of Technology (MIT) Center for Information Systems Research (CISR) shows that large companies in the top quartile of employee experience are twice as innovative and 25% more profitable than those in the bottom quartile. We see a significant shift towards a reimagining and refocusing on the workplace experience as a truly strategic investment to attract and retain both employees and customers.

This goes well beyond the tablet craze we saw with retailers giving their employees mobile devices and thinking that is a better experience for employees and customers alike. The workplace experience centers on how to augment workers with tools, data and AI technologies to empower them to serve their customers in a better and more efficient way. It then extends to furthering customer convenience with intelligent customer service offers that surround products like same day delivery and return transactions that actually build brand loyalty.

The retail industry will no doubt continue to experiment with AI technologies looking to improve the way that people experience both buy and sell transactions. My advice is to watch them closely as we are all buying or selling something and what truly differentiates each of our brands are the services and experiences surrounding those transactions. Every industry should watch and learn, incorporating the lessons from the retail industry’s mistakes and successes. This includes getting back to the basics with data as your AI is only as smart as the data that feeds it, creating experience experts to exploit the blend of the digital and physical to enhance the workplace and consumer experience, and realizing that your focus on improving your own employees’ experience is a strategic advantage.

As Avanade’s Chief Technology Innovation Officer, Matt Joe helps teams envision, embrace, and realize the art of the possible in today’s digital, ubiquitous computing world. Matt is the Chairman of the Technology Leadership Council of a non-profit, 501 Commons, is a member of Microsoft’s Distinguished Engineers Council, a member of Accenture's Technology Vision External Advisory Board where he works with industry leaders to help shape its forward looking trends, and is also a member of Accenture’s Global Technology Leadership Council. Matt graduated from Boston College where he studied Computer and Cognitive Science.

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Guest Commentary

Guest Commentary

The InformationWeek community brings together IT practitioners and industry experts with IT advice, education, and opinions. We strive to highlight technology executives and subject matter experts and use their knowledge and experiences to help our audience of IT professionals in a meaningful way. We publish Guest Commentaries from IT practitioners, industry analysts, technology evangelists, and researchers in the field. We are focusing on four main topics: cloud computing; DevOps; data and analytics; and IT leadership and career development. We aim to offer objective, practical advice to our audience on those topics from people who have deep experience in these topics and know the ropes. Guest Commentaries must be vendor neutral. We don't publish articles that promote the writer's company or product.

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