Digital solutions enhancing online & in-store experiences
16 July 2020
One of the last decades’ most significant and impactful megatrends is without doubt digitalisation. Digital solutions are challenging the status quo across a multitude of sectors – not least the retail industry, in which a wave of opportunities is emerging for digital solution providers, such as SCC members Novicell and Sitoo, to digitise and improve retail experiences. The Link met with Toke Lund, International E-commerce and Digital Strategy Director at Novicell, and Isabell Aakervik, Partner and Marketing Director at Sitoo, to discuss the impact of digitalisation and e-commerce within the retail industry in midst of the ongoing pandemic and beyond.
The common denominator between a vast majority of digital solution providers in retail is the aim to create extraordinary customer retail experiences. However, the path to success can slightly differ. Sitoo is a unified commerce SaaS platform, specialising in mobile point of sales for global retailers. Isabell Aakervik, Partner and Marketing Director at Sitoo, explains further: “Sitoo digitalises physical stores and unifies the in-store sales channels with each other and with online in real time.” In essence, Sitoo operates a cloud-native platform entailing an API built for seamless integration, scalability and high transaction volumes. To enter the UK market in September 2019 was a natural step for Sitoo, due to the high level of digitalisation within British business and society. “UK is the largest B2C e-commerce market in Europe. It is also a very digitised society with 96% of the population expected to be online this year. Last year, 87% of that online population bought something online,” says Isabell.
In relation to the millennial shift, Danish digital agency Novicell was founded in a somewhat extraordinary manner. “Basically, Novicell was founded by eight lovely geeks in Denmark some 20 years ago, that found out that they were really good at working with data and making solid solutions for customers by building large and complex web pages,” describes Toke Lund, International E-commerce and Digital Strategy Director at Novicell. In the main, the call of Novicell is to build complex and high performing digital customer solutions, including for instance e-commerce solutions and business intelligence engines. Over the last two decades, the business has expanded across Europe, with offices in Denmark, Norwway, the UK, Spain and the Netherlands. The opening of their London office in the autumn of 2017 appeared to be an obvious choice: “In essence, the UK is an important market for us due to its high level of growth. We see a lot of opportunities with the technologies that are growing in the UK market, that is shifting towards open source products – which is one of Novicell’s core strengths.” Upon establishing in the UK, Novicell was eager to seize networking opportunities offered by the Swedish Chamber Of Commerce: “Joining the Chamber gave us a wealth of networking opportunities as an emerging company in the market and we are eager to make the most out of it.”
Seamless experience highlighted by the pandemic
The retail industry, similarly to business and society at large, has been significantly affected by the ongoing global pandemic. For instance, retailers have to an increasing extent grasped the importance of providing an omnichannel retail experience across online and in-store platforms alike. “Combining e-commerce with bricks and mortar has been a challenge that retailers have struggled with for years. The need to have true ‘unified commerce’ – and a seamless experience across all sales channels – has been highlighted by the pandemic,” says Isabell. Furthermore, the prohibition of non-essential store sales has resulted in an increased necessity of digital presence, as well as a rising requirement of agility and reactivity. “The future will be characterised and described with adjectives like speed, agility, mobility and flexibility,” says Isabell. Going forward, Isabell is determined that these adjectives will be vital for success: “The brands that are in the best position post COVID-19 are those that have been agile and able to react and respond instantly to the current situation. These brands have not been afraid of change, they have been incredibly proactive in communicating with their customers and, as a result, they will be rewarded with soaring levels of customer loyalty.”
Increasing popularity of digital solutions
Although the retail industry indeed has witnessed an increasing need of digital solutions recently, the emergence of e-commerce was initiated already in 1995 by Amazon. “When Amazon was founded, the e-commerce movement focused on pricing, since it was cheaper to develop e-commerce than physical stores,”says Toke. However, this price difference has evened out in recent years, redirecting focus towards convenience, as well as a deeper possible interaction with products online. “What e-commerce really is driving right now is transparency and convenience. E-commerce solutions reveal exactly how much there is in stock, the exact price and recommendations. You can get all the transparency around your purchase, as much as you like.” Furthermore, Isabell highlights modern cloud technology as a key driver of agility and effectivity in innovative retail solutions. “The physical stores and online channels communicate in real-time – thus providing physical stores with much of the functionality previously only used online,” says Isabell. According to Toke, another major driver of e-commerce in the last decade has been the popularity of Apple iPhone. Corporations that have played a key part in forming the global e-commerce ecosystem are for instance Amazon, Alibaba and eBay. Also, many fast- pace delivery models has resulted in purchasing items online has become far simpler than visiting a store.
The popularity of digital solutions has increased greatly with a new set of challenges for retailers, including highly competitive marketplaces and workforce challenges, in combination with changing shopping behaviour. The modern consumer has endless choices of where and how to shop, resulting in that if expectations are not met, customers will quickly turn to competitors. “With a rise in e-commerce, mobile commerce, and social and live commerce, retailers need to ensure they have the tools in place to meet the customer in every scenario and create a seamless link between them all. In doing so, they meet customer expectations and deliver the kind of experience tech-savvy consumers expect,” says Isabell. She states that the alteration in shopping behaviours alongside more knowledgeable and demanding customers fuel the retailers’ embracing of digital solutions. “E-commerce is growing exponentially but is still only a small percentage of total sales. That is why retailers are embracing digital solutions which bring digital and physical stores together.”
Creating a unified experience
Sitoo provides a solution that bridges the gap between conventional brick-and-mortar stores and an online retail experience, making it possible for in-store and online sales channels to act like an unity. With their technology, Sitoo enables retailers to create a unified commerce experience across all retail touchpoints. “The key for Sitoo to be able to create a unified retail experience is real-time data flows between all channels, so retailers and their customers have access to exactly the same information everywhere,” explains Isabell. In essence, Sitoo’s solution consists of three main components: the Sitoo cloud-native platform, the Sitoo native POS app for iOS or Android and the Sitoo open REST API, which facilitates all real-time data flows between the Sitoo platform the Sitoo App and other retail systems like ERP, eCommerce and CRM. “To ensure retailers can streamline their inventory management, empower store associates and exceed customer expectations – our road map is driven by the evolution of retail. All continuous updates are automatically made available for all our customers, making sure they are always running the latest technology,” says Isabell.
Key to balancing online and in-store sales is understanding sales data from both channels, as well as the correlation to customer behaviour. Essentially, by tracking and identifying customer demands, behaviours and patterns through the analysis of cookies and gadgets, retailers can increase the understanding of how to better serve its customers. However, new legislations – such as GDPR – have resulted in increased difficulties in gathering and analysing customer data. By being strong across online and in-store sales platforms alike, retailers are enabled to reach most customers and run more efficient operations. The idea is to have an extensive assortment online, whilst mainly distributing best-sellers in store. “Basically, retailers can run smoother and leaner operations if they analyse customer data and understand what the best sellers and slow runners are, respectively,” says Toke. Although mostly the best-sellers are physically available in the stores, Isabell stresses the importance of o ering customers a so-called ‘endless aisle’– an online access to the full assortment in stores as well. Toke particularly highlights the famous British department store John Lewis as a retailer that effectively balances physical and digital sales. “John Lewis is quite good in the UK, because they really understand how to create a good experience in-store, but they also know how to excel with the in-store experience,” says Toke.
Solutions built like LEGO
In 1980, world-renowned economist Michael Porter introduced the strategic model “Porter’s generic strategies”, clarifying that strategy shall target either cost leadership, differentiation or focus. “Porter clarified that businesses either shall compete on cost and pursue a standard strategy or compete on differentiation and customise. If businesses do both, they risk being stuck in the middle, from where it is expensive and difficult to change,” says Toke. When aiding customers to develop e ective e-commerce solutions, Novicell bases their guidance largely on this principle.
Accordingly, Novicell has built an ecommerce framework that offers clients flexibility, high performance and longevity. “Our framework is built with a microservices approach – think of it as LEGO blocks. All services and software are independent of each other and connect to a central data layer,” says Toke. The approach means that Novicell’s clients can upgrade or change a specific software or programme without effecting their current e-commerce eco-systems. “By building and utilising that thinking in small increments, we can make one model today and another tomorrow, depending on how the customers want to compete.” Fundamentally, Novicell’s operating model is performed in three basic steps – helping clients to define an exact strategy, designing a system landscape and maintenance and boosting. The latter step includes search engine optimisation, generating business logic with the potential to boost a business. For instance, SEO tools such as Google and Facebook Ads drive traffic to e-commerce sites: “By understanding the algorithms of Google and Facebook, we aid clients in generating traffic to the platform, executing orders and generating more business online. So, we help them before, during and after they launch a digital solution,” says Toke