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Blinded by AI bling: retailers need to think back to front

From chatbots to delivery drones, the retail industry is flocking like a magpie to AI and flaunting its bling with pride. But some experts believe the industry’s take up of AI is all looking a bit like mutton dressed as lamb.

More and more retailers are introducing new artificial intelligence (AI) technology. Just this month Uniqlo launched a new mobile assistant that uses voice recognition and some level of AI and Walmart has introduced its ‘Alphabot’ robot for grocery storage and pick-ups.

Research company IDC says 40% of retailers will develop a new kind of customer experience based on an AI platform by next year. But how successful that new customer experience will be is much debated. Is AI really going to destroy human jobs and fuel a faceless future retail experience?

Mutton dressed as lamb?

A Deloitte study predicts 60% of retail jobs will be automated in the next 20 years – the highest of any other industry. And, at first glance, till-free shopping is the epitome of just that. 

Sainsbury’s announced its first till-free store pilot in North London last week following on from Amazon Go’s checkout-free store launch in Seattle in 2016. But media commentary on self-service checkouts is far from flattering. As David D’Souza, Head of London, CIPD, wrote in HRZone : “For anyone who has engaged in a battle of wits with a self-service till that flashes its screen to insist it has a far better understanding than you of what is in the bagging area, there is a cost of consumer convenience,” he says.

“Automation doesn’t necessarily mean improvement – although the intent is certainly to improve margins - and it is worth considering how much losing the humanity from these systems costs,” he adds.

The ultimate impact on the customer experience has been contested. The Guardian wrote on retail’s automated future, saying: “The humans you speak to are more likely to be apologising for the failure of computer systems than to be helping or encouraging you to buy things.”

But these views aren’t fair to the retailers who are getting it right. Artificial intelligence (AI) is allowing retailers to automate simple tasks and push human workers to the forefront to build a better customer experience.

Marks and Spencer (M&S) will be deploying AI in its call centres by the end of September.

“The technology is set to be rolled out to all of M&S’s 640 stores and 13 call centres across the UK. The new software will replace human operators previously in M&S’s call centres, but – and this is the crucial part – no jobs will be lost in the change, with more than 100 employees reassigned to in-store roles instead,” reports Econsultancy.

Burberry’s digital strategy combines its heritage with cutting-edge technology that precisely serves to cultivate a luxury customer experience. The staff in Burberry’s till-free flagship store in London aren’t by any means apologising for technology failings: the retailer has unshackled its staff to enable them to provide a proactive and personal service.

This is underpinned by technology across its entire operation with its launch of an ‘end-to-end digital strategy’ in 2006. The retailer uses AI and machine learning tools for front-end personalised customer management but also for preventing fraud and production processes (Forbes).

From front to back office

To create a new customer experience, analysts at research company Forrester advise retailers to concentrate on the back-end first.

“Use measured, gradual approaches to enter the world of AI by focusing on back-end processes first. Get executive buy-in on the importance of seamless customer journeys and the importance of supportive technologies like robotic process automation (RPA) and low-code, which jump-start end-to-end automation. These tools will ultimately pave the way to a foundation that can fully exploit the power of AI and radically transform customer experience,” say analysts Rob Koplowitz and Sucharita Kodali.

The missing piece

Retailers have already been automating back-office functions, such as transactional and merchandising processes, and thereby releasing staff to focus on customers. ALDO announced this week that it is automating its IT operations. Urban Outfitters uses Google’s AutoML to automate product attributes within inventories and remove long, manual processes.

However, the Forrester analysts believe the missing piece is “a complex infrastructure of end-to-end process automation [underpinning] the flashy technology reflected on the front end.”

Enate’s simplified service automation product helps businesses build this by providing the end-to-end framework for successfully deploying automation software, managing the new digital workforce and analysing what to automate next. Ultimately, this ensures the use of new technology frees up (rather than replaces) existing staff to improve customer service beyond simple tasks. The focus of Enate’s robotic service orchestration (RSO) is on incremental improvement and agility.

A new customer experience

While the full impact of AI on the retail industry is unknown, the continuing decline in footfall and consumer spending is having a tangible effect on retailers. The likes of House of Fraser, Toys R Us, Poundworld and Maplin are all disappearing from the High Street. Retailers need to hone their customer experience more than ever.

Rather than replacing staff, the real promise of AI lies in its ability to free-up human workers to cultivate this good customer experience rather than deal with time-consuming repetitive tasks.

The reality is that the use of AI – with all its data mining, machine learning, natural language processing (NLP) and bots – will need to transform the entire retail process before retailers can achieve the ‘shiny’ new customer experience that’s required to successfully compete in a new digital consumer world. And the back-end is a good place to start.

Find out how Enate’s robotic service orchestration (RSO) can help you tackle RPA deployment and manage your new human and bot workforce.

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