Connected Retail will facilitate a fundamental change in the current retail operating model and the metrics used to define success. As John Riccio discusses, these changes will be underpinned by the characteristics of disruption, engagement, digitisation and trust.

As highlighted in our report, Connected and curated – Long live the store!, retailers are in a position to connect with customers through technology to offer a far superior experience. And with digital technology becoming a pervasive part of our everyday lives – the delivery of a seamless experience (regardless of channel) will be a necessity, rather than a ‘nice to have’.

Connected Retail means connecting the customer seamlessly? to personalised marketing,? the physical store, the digital experience, supply chain, seamless payment options, and most importantly to help staff to deliver a branded customer experience.

In order to achieve this, retailers must continue to invest in technology to redefine and simplify their operating model and performance metrics.

Structuring for success

PwC - Connected Retail - Organisational structure

The organisational structure supporting a Connected Retail operating model

Delivering Connected Retail means implementing a new operating model that is customer centric, agile and powered by data and technology. A Connected Retailer will:

  • Have ‘digital’ capability embedded in all parts of the business.
  • Use customer insights in every part of its business to inform decisions that are centred around the customer.
  • Take a single-view of retail channels and have a consistent set of metrics that allow customers to interact with an organisation through their channel of choice.
  • Empower team members through data and digital devices to improve productivity and customer service.

In order to support this change there will be a significant change to the organisational structure:

Roles to drive customer-centric change
The roles of Chief Performance Officer, Customer Engagement Director and Products and Services Director, have been elevated and will be responsible for (respectively): leading organisation-wide transformational change, driving overarching customer experience and designing a customised product offering based on customer insights.

New digital priorities, new digital roles
With digital embedded throughout the organisation, guarding customer and business data becomes paramount, thus the introduction of a Cyber and Security Director. Similarly with data becoming key to business decisions, the role of the Data Operations Director is immense in ensuring that this information is available and embedded throughout the organisation to enable real-time insights and action.

Managing the seamless experience
The most significant change in the Connected Retail operating model is the merging of channels to create a single view of customer and enable the provision of a seamless experience. With this change comes the introduction of the Channel Logistics and Channel Operations Directors – collectively responsible for implementing consistent metrics, experience, delivery of service, fulfilment and customer service.

A new retail scorecard

As business focus becomes skewed towards the customer, metrics will be critical to not only measuring success, but driving the change required to realise a Connected Retail model.

While traditional business metrics (such as sales, margin, EBIT, ROC, CODB, etc.) will still be relevant, these will need to be considered together with metrics pertaining to digital/online (if not already incorporated) and those specific to Connected Retail (outlined in the diagram below).

PwC - Connected Retail - Metrics

Food for thought: Taking a new perspective

While facilitating a fundamental change in the operating model and metrics of retail organisations, Connected Retail will take time for the majority of organisation to implement. Where to start? Retailers need to take a different perspective when examining their core operations, underpinned by the following characteristics:

PwC - Connected Retail - Digital perspectives

These lenses can be applied broadly across a business, specifically in retail these might be applicable to supply chain, customer service, fulfilment and marketing – to name a few. Retailers looking to overcome these issues should consider the following:

– How is my business being disrupted?
– What is the impact on my business model (e.g. profitability)?

– How have the requirements and expectations of the customer changed with regard to this disruption?
– How do I empower my workforce to meet customer needs?

– How can I digitise the process/service being disrupted for increased efficiency and productivity?
– How will digitisation enhance customer engagement?

– How do I ensure that the change is secure and promotes customer and employee trust?

Find out more about how your business can structure for and measure Connected Retail success – download your free copy of the Connected Retail: Reshaping tomorrow’s operating model and metrics report.



John Riccio

John is PwC’s Global Design & Deploy, Experience Consulting partner.

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