Stores are undergoing a transformation, not only in their purpose in the wider customer journey, but in terms of their technological backend. Alongside this, e-commerce funding is falling, only reaching a third of 2021’s total halfway through 2022, indicating that the e-commerce boom is beginning to fall. With the in-store space garnering increasing attention as a result of rising brick-and-mortar profits, for many, it is the right time to consider digitally transforming their physical stores. Yet some retailers are still held back by legacy architectures of the traditional in-store stack, without realising they can repurpose their e-commerce investment within the store. What role can MACH philosophies, and in particular, decomposed architectures play in making the store truly digital? Furthermore, what business value can be derived from this?
What does the current retail landscape signify, and what is coming next?
Traditionally, the in-store space had to be operational even without Wi-fi, as monolithic solutions were deployed for a specific need (e.g. POS was used to transact only), and their siloing did not affect the rest of the business significantly. Customer expectations were very different, and so were those of retailers – providing frictionless omnichannel experiences and uncovering a single customer view across multiple channels was not part of any retailer’s mission. Now, this is business critical. This has resulted in the momentous push for digital transformation in the store and a total overhaul of the store infrastructure and back-end architecture. By opting for Next Generation Composable solutions, retailers now reuse APIs in real-time, instead of relying on fragmented, siloed offline solutions. Whilst supporting some offline capability is key, the trend is clear – online, composable solutions are here to stay, not just for ecommerce, but critically, for the whole business.
Non-linear shopping journeys are now the norm - research shows that shoppers expect to be able to access a brand’s products via multiple channels and for this experience to be consistent, as more and more of us ROPO (Research Online, Purchase Offline and vice versa). Right now, this is a challenge for retailers, who are dealing with customers who are used to real-time inventory, rich product data, flexible fulfilment, and personalised recommendations online. Achieving this customer experience, as well as building attribution models can only be achieved in stores that are supported by the right underlying APIs. Retailers need to unify the online and offline world by utilising a next generation in-store composable platform, and in turn, recognise the customer and bring the personalisation they love online into the store.
Increasingly, customers are demanding for physical retail to become more connected, and as we see, composability is key to connected stores.
What is the business value of implementing MACH philosophies in-store?
For IT teams, going composable may be an easy decision when considering the possibilities it affords, but we must relay the business benefits to commercial teams in order to have the whole company on board. We all know the benefits from a technical point of view, such as agility and removal of expensive upgrade costs and cycles, but seconded to that, we need to understand how going MACH can positively impact the commercial side of the business. When proposing the implementation of MACH technologies, it is important to put together a business case which highlights some of the business critical benefits it affords to retailers (both online and in-store), of which I outline a few below.
By going composable, retailers gain significant omnichannel advantages in terms of customer experience. With in-store composable solutions, retailers gain the ability to recapture in-store abandoned baskets online, or in another store on a subsequent visit. Secondly, they can build mixed baskets, so a customer can build a basket of products available in-store, online and in other stores, and complete a single transaction, with fulfilment automatically taking place from those multiple channels (I share below how this is achieved by the coming together of MACH Alliance Members). All of which results in happier customers and in turn, higher lifetime value, corresponding to the growing expectation of personalised in-store experiences for customers that the store has traditionally not been able to provide.
Retailers will also see fewer lost sales and improvements to conversion rates due to the fact they can now recover baskets from other channels, and higher UPT as they facilitate online, in-store, and other store baskets and recommendations in a single transaction.
Increasingly, we are seeing more members of the MACH Alliance come together to provide in-store specific scenarios. For instance, delivering frictionless omnichannel fulfilment is made possible by the coming together of MACH members Mercaux and Fluent Commerce. By integrating with Fluent Order Management, Mercaux can surface near real-time omnichannel inventory and offer flexible fulfilment options to store associates and customers in-store using our assisted selling and self-service digital experience solutions. As more and more retailers keep smaller amounts of stock than before due to rising overhead costs, composable architectures that provide greater connectivity across a retailer’s entire offering (online and in-store) will see retailers being able to provide frictionless fulfilment experiences both for customers and for the retailer.
Why is future proofing via MACH philosophy so key?
By being API-forward and composable, retailers can respond to changing trends and customer expectations, making them more agile than ever before. We are finally at a time where retailers can make quick changes without having to rely on long upgrade cycles and heavy amounts of in-store legacy technology, made possible by MACH vendors.
By choosing composable vendors for both their online and in-store offerings, retailers can ensure they are creating a consistent experience both in-store and online, bringing the best of both worlds into each respective space. For the first time, retailers can begin decomposing their technology stack and reuse traditionally online only APIs, bringing scenarios that were previously online-only into the store. This is the key to ensuring retailers can always stay a step ahead in the long term, without investing into legacy technologies that will become obsolete in a few years.
