The retail industry has been going through tremendous change and transformation over the past decade. Many have speculated that traditional brick and mortar retail is dying, and that customers are moving completely to online platforms for their shopping needs. This is, however, not the case. According to a report by the National Retail Federation, retail storefronts in the USA have continued to grow at almost 4 percent annually since 2010 along with the steady double-digit growth of online retail. Along with this, nearly all of the top 50 online retailers also have physical stores.
Even though e-commerce growth continues to outpace physical stores, the value of growth is still much higher in physical retail outlets. E-commerce in a majority of cases is also not a standalone channel but used in conjunction with traditional and emerging channels to service customer needs like buy online pickup in store (BOPIS) or Click and Collect. Location is still a major part of customer shopping habits, but with this we have also seen that customer expectations around shopping have changed. Gone are the days of store agents being the exclusive experts in product knowledge. Customers now have more access to product information, price visibility, and availability than ever before. With this comes the need for retail to look at customer engagement across all channels and ensure their business is enabled to deliver on these new heightened expectations. In the next few years, e-commerce will no longer be a major differentiator for retailers, but rather enabling unified retail commerce is required to succeed in the world of ever more demanding customer expectations.
But this is easier said than done. Many retail businesses are struggling with disparate commerce systems that create more of a disconnect with customers than opportunities to engage. Even though unified commerce is not a new concept, many retailers have found it difficult to understand where to start.
It is with this in mind that Microsoft announced Dynamics 365 Commerce, an evolution of Dynamics 365 Retail, that will become broadly available on February 3, 2020. This release adds e-commerce to our solution and is built from a proven content management system used by Microsoft online storefronts for years. Dynamics 365 Commerce is, however, not limited to e-commerce, but sets out to simplify the process of unifying customer shopping experiences through an end-to-end commerce platform that brings together e-commerce, in-store, back office, and call center along with enabling easier integration to emerging channels through an API driven headless commerce engine.
Microsoft and Forbes also recently undertook a joint executive and consumer research program that highlighted the changing expectation of consumers and how retail business can better cater to these evolving needs. Let’s explore how Dynamics 365 Commerce is helping retailers address these prevailing needs in their businesses.
Delivering exceptional and personalized customer experiences
Customer experience is not only one of the top growth drivers in retail but according to the recent Microsoft and Forbes study, is also considered to be the top strategic priority amongst retail executives, for 33 percent of retail executives. The challenge is defining what comprises exceptional customer experience for each individual business, as customer expectations vary by retail micro-vertical, product category, and the customers themselves. It’s up to retailers to best identify how the experience aligns to their brand promise. Once customer experience is defined, retailers need to be able to deliver on this promise by having technology that enables next generation customer engagement and doesn’t limit their ability to innovate and create differentiating experiences for customers.
According to the Microsoft and Forbes study, offering personalized shopping is becoming more and more prominent with over 49 percent of consumers aged between 18 to 24 saying they are more likely to purchase from retailers that offer personalized shopping experiences. The goal of personalization is to create a bond between the retailer and the customer by providing products and/or services based on previous engagements across all retail channels. This elevates the engagement beyond a simple transaction to an experience more akin to an interaction with a trusted partner or friend.
There is a major dependency on technology to achieve this next level of personalization. Retailers require connected and real time insights into customers and operations. Dynamics 365 Commerce natively brings together all aspects of customer interaction across e-commerce, call center, and in store as well as easy integration to emerging channels to help retailers gain a comprehensive view of customers. Couple this with out-of-the-box integration into Dynamics 365 Customer Insights and retailers can not only offer AI driven recommendations based on customer purchase history, favorites, and trends, but also provide in store agents with tools to see a 360 degree view of the customer and enable rich engagement throughout the sales journey.
Ste. Michelle Wine Estates is the largest premium wine distributor in the United States. They’re renowned for making some of the best wines in the world and pride themselves in delivering amazing wine tasting experiences at wineries for their 14 distinct brands. Ste. Michelle recently went live with Dynamics 365 Commerce to deliver an end-to-end retail solution for their business. Being able to track customer engagement across modernized e-commerce sites to their wine clubs and call centers mean that Ste. Michelle can offer more personalized customer recommendations and experiences in their tasting rooms.
“We found our answer in Dynamics 365 Commerce. We now have a centralized repository where our data works together to provide a seamless experience for our guests along with better insight into our operations.” – Francis Perrin, Chief Marketing Officer, Ste. Michelle Wine Estates
The importance of enabling omnichannel and streamlining operations
The days of customer engagement on a single channel are long in the past. Customers expect to be able to shop wherever, whenever and through whichever channel they choose. Retailers also recognize the importance of omnichannel with 47 percent of executives from the Microsoft and Forbes survey ranking this as one of their top three priorities.
Many retailers still struggle with enabling an omnichannel experience due to complexities of internal technology and disconnected or disparate systems. Dynamics 365 Commerce makes this much simpler as it was built in the cloud to deliver a native omnichannel solution for retailers.
Columbia Sportswear Company has a portfolio of brands for active lives and is a leader in the global active lifestyle apparel, footwear, accessories, and equipment industry. They chose Dynamics 365 Commerce to deliver enhanced experiences for their retail customers.
A connected commerce solution is not just important in how customers engage and shop in retail, but also how a unified solution can enable better engagement from firstline workers and ensure optimal operational efficiencies across your supply chain. Dynamics 365 Commerce allows retailers to streamline their operations with infused intelligence that permeates throughout their business. Store staff can gain better insights into stock availability, cross application support for task management between Commerce and Microsoft Teams, along with commerce analytics that allows managers to track performance and insights to help them make better decisions.
An established and well-loved brand, Dr. Martens has grown over many years to become a global lifestyle footwear brand with sales to 63 countries across the Americas, EMEA, and Asia. Like many established businesses, they had a plethora of old IT systems and processes that have served them well, but could not support their ambitious growth plans. Dr Martens looked to Dynamics 365 Commerce to bring a range of isolated solutions together and deliver a single source of truth for their business to operate from.
Dynamics 365 Commerce at NRF 2020
This week saw another great showing of Microsoft retail solutions at NRF 2020. Along with a great range of 1st party and partner innovations, we showcased the advancements and innovations present in Dynamics 365 Commerce. This included the announcement of our official release date on February 3, 2020 and the native integration of intelligent solutions from Microsoft including Dynamics 365 Customer Insights, Dynamics 365 Fraud Protection, and Microsoft Power Platform.