PHILIPPINE RETAILING
COVER STORY
Surfing the Digital
Transformation Tsunami
in Retail Industry
In an age when Digital Transformation has
easily and deliberately seeped through
people’s lives—from the way we
communicate, buy things, and manage our
daily activities, it is not surprising that many
things we see in sci-fi films today will soon
be available in the near future.
In the midst of these fast-paced
innovations, technology evangelist and
former managing director of the world’s
biggest fashion company
Inditex (Zara, etc.), Mr. Jesus
Vega, shared some insights
on what strategies retailers
can implement in this fourth
industrial revolution.
Vega is one of the most
sought-after speakers for
international conferences
and is an independent
advisor for several
companies in retail, fashion
and business strategy. He
recently served as keynote
speaker at the 26th National
Retail Conference and Stores
Asia Expo.
This is especially true in an era when
technology is common, but people long for
human interaction and products they feel
aimed and customized for them.
“Physical stores are
also more than a
place to display and
sell products”
“..But a channel to provide
customer experience. Retail
exists to provide customers at
least a minute of happiness.
Retailers need to find a way to
customize products, as well as
messages and advertising
based on the data collected
from a particular customer.”
“Industries will
overlap”
Vega
“Data is more
relevant than ever”
Vega shared how companies should value
data more than ever. “Stores should not
merely be about selling products. The store
should also be able collect data.”
“We have to collect data, analyze them and
from there, we can communicate with the
customers and provide exactly what they
want”, he said.
“For so many years, we in retail didn’t use
that data so much, but now we have the
technology. And if we don’t profit from it,
we have a problem.”
“Treat customers as
friends”
“What customers need is to be treated
differently according to the variables
that are important for them.”
To thrive and survive, Vega also
suggests that industries need
to merge. For instance, Santander Café, the
biggest cafeteria in Chile, with locations in
Spain, Portugal, Argentina, Brazil and UK as
well, offers their clients not only bank
services, but also serves as a co-working
space and coffee shop.
A restaurant which sells every furniture
piece in their store is also one way that
industries or niches in the industry can
merge or overlap. On the other hand,
Alibaba in China is revolutionizing the most
mundane part of shopping in the mall—the
toilet.
The e-commerce company, which
eventually ventured into offline retail, has
installed smart mirrors in female restrooms
to make the wait in queue a bit smoother.
They can try various make up shades while
in the ladies’ room, and if they like
something, they can buy the products
through a vending machine—which is also
a smart mirror.
“Artificial
Intelligence will
provide many tools”
Vega also stressed that artificial intelligence
or AI to provide so many tools for retailers,
including collection of data and interacting
with customers. For instance, bots which
talk to customers in a manner that is
almost human have the ability to
communicate depending on our moods,
which makes people feel more connected.
“Millennials feel more comfortable
speaking with bots than human because
they don’t feel evaluated and gauged, as
opposed to typical conversation with other
humans.”
“…but technology
will not replace
people”
Vega also reminded retailers that they are
not competing with robots, rather with
companies who can use technology better.
“However, companies should also have a
clear offer to the customers, instead of
trying to do everything.”
“Also, retailers should remember that
technology will not replace people. The
most important key for our business in the
past, present, and future will still be people.
It’s not a matter of technology. I see a lot of
companies doing huge investments in
technology, but not doing huge investment
in people working with the company.”
“The role of our people will change in the
future. It is changing now. The stores will
not need so many people, but we will need
to be better. We will need to be different,”
according to him.
“Every peso you invest in technology, think
of your people first because they
will be the difference.”
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