Privacy, AI, and Data: Impacting the Changing Landscape of Customer Experience

Data and artificial intelligence (AI) have come together to greatly impact the rapidly evolving retail landscape. While AI and machine learning (ML) offer retailers great leaps forward in the area of customer experience, shopper data lies at the heart of these operations. Protecting that data and generating consumer trust is vital as retailers implement automation and personalization strategies. From Amazon Go stores that provide a seamless in-and-out experience, to stores offering relevant promotions to shoppers in the aisle while robots roam nearby to check inventory, there is a spectrum of automation taking place in retail today. Read on to learn how privacy, AI, and customer data come together to redefine retail experiences. Personalizing the customer experience (chosen by 63%) is the leading priority cited by retailers as they prepare their IT strategy for 2020, according to RIS’ “2020 Store Experience Study." It was also their top strategic priority in 2019, but support for it has increased by 24% year-over-year. While retailers see the need to personalize shopping and inspire consumers to enter their stores, just 13% of them have AI and ML for customer-facing technologies deployed. But plans are in the works to rectify this, with 38% expected to deploy the technology within two years. And no transformational technology comes close to the adoption rate of proximity or location-based marketing to create a personalized in-store shopping journey. Twenty-five percent of retailers have it today, 18% are planning deployment within a year, and 16% plan within two years. Without customer data, retailers cannot deliver the personalized experiences they plan to, whether via human, phone or robot. Retailers must act swiftly to unify customer data from all sources and protect data throughout the customer journey. Customer data security was named by 30% of retailers as a top technology-driven obstacle to overcome by the end of 2020 in RIS’ “29th Annual Retail Technology Study: Retail Accelerates.” And simply "trust" in an organization was a top reason (18%) why U.S. mobile users would be willing to share their data with companies, according to Statista. To uncover what retailers need to know about how privacy, AI, and customer data are reshaping the retail landscape, RIS talks with Thomas Kurian, director, strategic market development - retail and logistics market, Arm Treasure Data, about the latest retail customer experience technologies. RIS: What are the top 5 retail experiences customers will come to expect in the next five years? Thomas Kurian: A lot of research and browsing are done online, so the shopping experience is changing. Look for the following trends: Airbnb-powered retail experiences: Homes will be available to retailers and brands to showcase unique merchandise. Consumers can experience them as well as purchase instantly. Better online delivery options: FedEx and UPS will enable retailers to provide safe, white-gloved deliveries to customer homes while they are not there. Healthcare in and near retail spaces: Consumers will go to a retail store to see their physicians, dentists and for urgent care. Privacy: Privacy becomes the fifth “P” in marketing. Permission-enabled, encrypted, privacy-by-design will be the norm. Sustainability: Sustainability becomes a key part of the customer journey, and customers who value sustainability will take experiential tours to fully experience the brand in the supply chain. RIS: How can retailers provide an excellent customer experience while simultaneously incorporating more automation to be efficient? Kurian: Retailers have to be committed to protecting customer data and infusing privacy-by-design within the workflow of every customer experience. Without this, it will be challenging for customers to share their data — which is essential to deliver great experiences irrespective of whether a human or machine delivers it. Customer-facing operations like store executions need to be empowered with fresh customer data for clienteling, and assisted by AI-driven functions like personalized next-best product recommendations to increase the basket size. RIS: Which types of data are retailers successfully leveraging now to improve the customer experience, and what types of data will they prioritize in the near future? Kurian: According to the “Retail CX and Data Management Strategies in 2020” report co-authored by Arm Treasure Data, retail leaders already successfully leverage a wide range of customer data from sources such as customer service, clienteling, demographic, mobile apps, and campaign responses. They’re also investing in using more precise in-store location data to activate real-time promotions in the store. They already have cameras in the stores for security and measuring traffic patterns. And, increasingly, robots roam the aisles to track inventory. Data collected from cameras and robots will be used to improve the customer experience with easy-to-use features such as automatic checkout, which help unlock additional sales by lowering resistance and abandoned shopping carts, both in stores and online. RIS: What’s your advice for retailers trying to execute the same experience in the digital and physical channel, especially in light of increasing automation? Kurian: Digital transformation begins with unifying customer data from all sources for immediate insights, and then unifying all operations around that customer data. Investing in a scalable, secure customer data platform (CDP) helps retailers with this transformation. CDPs that have integrations with store execution software will unlock new business in the physical channel by empowering store associates with customer data. Investing in automation helps free up store associates for face-to-face interactions with customers, so they can focus on tasks that deliver brilliant customer experiences.