TCS in retail - Delivering omnichannel, hyper-personalized, and sustainable experiences

Over the last three years, food and non-food retailers accelerated their digital transformation journeys as consumer behavior changed dramatically. Below, PAC looks at how retailers evolved over this period and how TCS is helping its retail customers respond to customer demands and needs.

During the height of the pandemic, TCS worked with many of the major retailers/grocers in Europe on 'phygital' engagements by connecting the brick-and-mortar store to the end-consumer via online channels while simultaneously deploying technology to accommodate governments' imposed social distancing rules.

Today, with macroeconomic challenges, including high inflation, retailers focusing on cost-optimization cannot afford to halt investments jeopardizing consumer loyalty in a highly competitive market with marketplace eCommerce platforms, such as Amazon, being highly appealing by offering access to a vast range of products, direct trade promotions (promotions offered directly by third-party retailers on a platform), and tailored last-mile delivery capabilities.

This need to remain competitive leads to new opportunities for IT providers in the European retail market. Moreover, Europe lags behind markets such as the USA when it comes to bridging the gap between brick-and-mortar and online channels, i.e., 'phygital'.

There's a greater focus on headless and composable commerce, with retailers also seeking to save in backoffice and supply chain costs. In a headless commerce approach, the back and front end are decoupled, meaning innovation on one end does not interfere with the other. A composable commerce approach deploys best-of-breed solutions while offering distinct experiences for their employees and consumers within an omnichannel environment. Both have pros and cons, but what we see in current digital transformation projects in the adoption of composable commerce is the adoption of best-of-breed solutions (pro) with the temptation of the adopter to over-customize, leading to an unwanted level of complexity (con). Nonetheless, retailers' composable commerce investments enable the business to be ready for existing and future consumer necessities and experiences. This is particularly seen in the UK, with major retail brands leveraging the flexibility of composable commerce.  

From a digital and technology investment standpoint, most retailers reinforce what they already have while decoupling from obsolete technology and inefficient workflows. An example is UK's second-largest chain of supermarkets’ workflow transformation leveraging a Power Automate solution designed by TCS in 2022, leading to the removal of 7,000 obsolete workflows.

Those that have already deployed their eCommerce platform are now looking into ways to make it more seamless for customers. This can be done through business backend/frontend optimization, last-mile delivery, traceability, improved visibility, automated pricing, frictionless, and more.

This is where TCS plays a key role for its clients through its industry-specific IP solutions, including TCS Optumera (AI-powered retail strategic intelligence platform) and TCS OmniStore (unified commerce platform), where it has seen good traction. For example, a leading Dutch retailer deployed TCS Optumera to transform its pricing strategy in 2022.

But TCS' capabilities do not stop here. The services provider is leveraging the full breadth of offerings to turn a project into a wider and long-term engagement, encompassing strategy and digital transformation within various themes, including, but not limited to, operational excellence, sustainability, customer and employee experience, data & analytics, cloud, and more. Below, PAC briefly covers some of the themes and how TCS adds value.

Experience and journey

Retailers across Europe are investing in solutions and tools that target customer retention and loyalty and offer improved customer and employee experiences. TCS supports its retail customers in these areas, including pricing & promotions (e.g., curated promotions, profitable pricing strategy), loyalty engagement (e.g., personalized loyalty offerings), employee experience (emphasis on efficiencies for operations, replenishment, fulfillment), customer experience (self-checkout, mobile checkout, frictionless shopping experiences, interactive in-store navigation). These solutions depend highly on access and intelligent usage of data and analytics.

Artificial intelligence, data analytics & monetization

When combined with AI and analytics, data collected via loyalty programs and online/in-app interactions on customer behavior patterns (purchasing frequency, type of brands, pricing range, dwell time, etc.) can be leveraged for forecasting, which in turn can lead to tailored recommendations to the consumer for guided selling (e.g., brand affinity, lifestyle, or life stage), next-best product decision calculations, and to mitigate product return scenarios.

Sustainability

The environmental impact of retailers is top of mind encompassing the whole value chain from Scope 1, 2, 3, to product design, and all the way to circularity, e.g., cash incentive systems such as the Deposit Return Schemes as announced by the Environment Minister Rebecca Pow from the UK in January 2023 – schemes, that have already existed for years in countries such as the Netherlands across all channels.

From a buying perspective, a growing segment of consumers, such as Gen Z, wish to have access to a detailed product description page offering insights into product origin, water usage, product packaging, etc., be that in-store on physical items or on an eCommerce platform.

TCS is working with large retailers to optimize the value chain and supply intelligence through reporting and reducing the overall carbon footprint. For example, by leveraging AI, retailers can prevent (e.g., predictive maintenance) downtimes of produce cooling systems, which could lead to product waste, but also from an energy management standpoint, where based on weather conditions (i.e., temperature, humidity), AI can adjust equipment to the right temperature or lighting based on in-store foot traffic.

Overall, TCS is in a good position to support retailers to be future-ready. With over 1,000 eCommerce consultants (set to double over the next 12-24 months) and strong IP (TCS OmniStore, TCS Optunique, TCS Optumera Self-learning Supply Chain, and more), backed by several significant retail use cases over the last 18 months, businesses in this sector can expect to engage with an IT provider that understands the current market and consumer needs.