Industry leaders during a recent conference on the latest trends in Malaysia's retail sector as tantamount to a 'digital revolution'. The retail segment is steadily recovering from Covid-19 headwinds by ramping up digitalisation efforts akin to almost all other economic sectors.
Businesses are seeking ways to thrive and search for opportunities to move forward with especial focus on enriching and personalising their delivery of enhanced customer experience and engagement as a key priority.
The essential dots to delivering the prize of excellent customer engagement involve actionable stepping stones such as smart shops, customer analytics, omni-channel shopping experiences, enterprise-wide inventory visibility, and many-to-many fulfilment agility.
This was the consensus among keynote speakers at the Embrace to Survive the Digital Storm, a virtual event held to address current challenges and share digital insights with retailers, suppliers and partners. The leadership event was organised by TM One, the enterprise and public sector business solutions arm of Telekom Malaysia Berhad (TM), with Huawei Technologies (Malaysia) Sdn. Bhd. as the technology partner, and supported by Malaysia Retail Chain Association (MRCA) and AFAB WORLD Sdn Bhd.
The pandemic effect has certainly accelerated the digitalisation of traditional business and consumer behaviour. For the retail industry, delivering a digital-enabled retail strategy and digital transformation is key to supercharge the retail operations.
According to the latest report from Facebook and Bain & Company, 70 million more people shopped online in six Southeast Asian countries since the pandemic emerged, and foresees the total online numbers in the region will reach 380 million by 2026.
This switch to online was noted by the Hong King Trade Development Council's market research report which said that while offline retail constituted 91% of ASEAN's total retail market, more than three out of five people in the region are now online. The strongest uptake being Indonesia, followed by the Philippines and Malaysia.
As with most sectors, the pandemic has pushed the retail industry into the digital revolution. This can be seen from a study conducted by VISA on Consumer Payment Attitudes 2021, which states that online purchases have increased by 72%, compared to a decrease of 44% who shopped at physical stores.
In the first keynote session, Stan Jit Singh, the secretary general of MRCA said that "the technology revolution has evolved at an unprecedented speed and depth, causing huge disruptions and are heavily impacting retail today."
He emphasised that it is imperative for retail businesses to take advantage of the available technologies to avoid being left behind. "The ‘Digital Age’ is here today and technology and connectivity can be used to keep people, processes, positions and performance tightly connected and drive breakthroughs in the digital transformation."
"Capturing business and customer data points, gathered through multi-channel and omni-channel offerings, will help in understanding customer habits, and give the ability to segment customers based on alignment with their needs.”
“The future of retail will not necessarily rely on developing an extensive variety of products, but will involve winning over consumers with thoughtful curation of products, experiences and innovations through building customer-driven new business formats,” added Stan Jit Singh.
This demands a comprehensive digital platform to help organisations make a quantum leap to harness the relevant technologies needed to pivot into the future, he said.
As the retail industry comprises multiple segments, often including 'sub-industries' that are independently managed, there is a need to comprehensively connect all the data points to enable end-to-end visibility of the entire business ecosystem.
Stan spoke about the revolution in retail as encompassing revolutions of technology, culture, information, social media and knowledge management. "This new era is about the retail landscape moving to the next level to conduct business, commerce, services, and provide options to utilise multi-channel and omni-channel capabilities: these will help to deepen customer engagement with their desired brands."
"The ‘Digital Age’ is for everyone and today is the right time to start thinking and making those digital changes to transform your organisation to take advantage of all the technologies that are available in the marketplace for retail," he declared.
"However, understanding where you are and where you want to be is key," Stan cautioned. "This needs to be carefully weighed and sieved to ensure the business starts on the right footing. We need to use technology to keep people, processes, positions and performance tightly connected in order to break positively into the digital landscape."
Maintaining a visionary element was a key point in the leadership session presented by Datin Patricia Pee, the founder and chief strategist of AFAB WORLD.
"Retail digitalisation should go beyond eCommerce today," said Datin Patricia. "Digital Revolution is a phrase which has been used for more than two decades, now the force that really accelerated digitalisation and digital adoption so suddenly during the past two years is Covid-19." – Datin Patricia Pee
She said the pandemic has boosted digitalisation globally with consumers adopting digital technologies more rapidly than most companies. "Changing consumer behaviour has become more sophisticated as seen in online engagements. Many companies, on the other hand, are digitalising faster because of FOMO (fear of missing out) pressure."
Datin Patricia opined that retailers need to go beyond the notion of eCommerce in order to formulate strategies to deepen the engagement with their customers while building strong ecosystem partnerships to remain relevant in the digital economy.
“Fostering strategic alliances is vital as technology is developing fast and retail digitalisation is going through an extreme re-invention, as consumers become more sophisticated in their online behaviours. Artificial intelligence (AI), augmented reality (AR), blockchain, non-fungible tokens (NFTs) and metaverse are the technologies that will reshape the future especially the retail business.”
“Due to the complexity of technologies, the most important thing is seeking the right talent in technology deployment. It is best for retail businesses to have strategic technology partners to prevent from being lost in digitalisation - resulting in waste of money and time,” Datin Patricia added.
Underpinning the importance of key technology partnerships, Eng Chiew Hian, Business Development director of Huawei Cloud said that the company, as a global technology leader with local cloud presence in Malaysia, is proud to collaborate with TM One on α Edge (pronounced as Alpha Edge), the TM One hyperscale cloud service. As a collaborative initiative, this has resulted in the provisioning of additional expert technical assistance and guidance in helping SMEs to transform and stay relevant both during and in the post pandemic era.
“Huawei remains committed to work with customers and partners in providing intelligent solutions to help brick and mortar businesses survive during this challenging time," he said. "Our cloud technology helps to accelerate industrial digital transformation, where retail business owners can move part of their operations onto the cloud to maintain lower overhead cost." – Eng Chiew Hian
“Furthermore, working closely with partners like TM One and AFAB has provided an integrated platform for local businesses to go online with the aspiration to go global and uplift their sales, all these is made possible with cloud technology,” he added.
In the final keynote, the head of Innovative Solutions of TM One, Maznan Deraman presented insights to help retail business leaders pivot to a new mindset aligned to embracing the digital retail landscape evidenced by rapidly shifting consumer buying patterns.
He also highlighted the rationale in utilising cloud-based solutions to stay relevant and resilient in today’s rapidly changing environment. Consumer buying patterns have dramatically shifted from physical transactions towards eCommerce-centric behaviours, which deliver a huge impact to existing brick and mortar retailers.
“Cloud technology is able to manage the end-to-end retail ecosystem by syncing inventory with customer’s demands and interest while improving customer experience, driven by the data obtained via online and offline. A cloud-based platform provides greater insights on daily retail operations, for better visibility and decision making.”
“Cloud technology is able to manage the end-to-end retail ecosystem by syncing inventory with customer’s demands and interest while improving customer experience, driven by the data obtained via online and offline. A cloud-based platform provides greater insights on daily retail operations, for better visibility and decision making.” – Maznan Deraman
His presentation included case studies demonstrating TM One’s understanding of the scenarios and challenges retailers are facing today. Addressing these challenges with digital enabling strategies and solutions with smart retail applications provides a practical move forward, he said.
“As Malaysia’s only leading cloud service provider, the immediate value of TM One’s solutions to unlock consumer and in-store behavioural analytics, smart inventory management and single integrated platform is evident. All of these are hosted on TM One Cloud α (pronounced as Cloud Alpha) and can be connected seamlessly with third-party retail applications, to help build more meaningful customer loyalty,” concluded Maznan.
"Providing a digital option to customers and stakeholders is absolutely essential as today's B2B and B2C business models are increasingly calling for end-to-end solutions, which connects manufacturers, logistics, supply chains and other key components in order to fulfil and excel customer demands," he said in his concluding remarks.
Compelled by lockdowns and social distancing measures, retail businesses in Malaysia have uncovered a digital passion to seek out the most effective ways to survive and even to thrive beyond the current fragile conditions. Formerly factored by the industry as a 'good-to-have' option, the pandemic has now pushed the adoption of a digital ecosystem strategy to the top of the agenda moving forward.
This article was first published by Disruptive Asia.