Forward the digital road: Shopping up in the cloud

MANILA, Philippines — The global pandemic caused most stores’ shutters to clatter down at a time when high street retail was already vulnerable. With most physical stores closed, the technologies that underpin their online presence have had to accommodate the massive spike in online shopping driven by lockdown.

In the Philippines, iPrice Group’s report indicated that online shopping among Filipinos grew by 57% in the first half of 2020 versus the same period last year, making it the highest recorded increase in Southeast Asia. The usage of shopping applications in the country also increased by 53%, with 4.9 billion total sessions recorded in the second quarter of 2020.¹

Local businesses continue to pivot to ecommerce for business continuity, making e-commerce the main driver of significant growth in the Philippines. Last year, the Department of Trade and Industry (DTI) recorded a significant increase in online business registrations, from 1,753 in January to March 2020 to 75,875 as of September 2020.²

To also support e-commerce development in the country, several house bills aimed at promoting the digital economy and at establishing an e-Commerce Bureau have been filed recently. The DTI also updated the e-Commerce Philippines 2022 Roadmap, which seeks to create an e-commerce ecosystem that drives industry development.³

It’s my belief that the pandemic will accelerate the pace at which retailers embrace digitalized business models. That’s not just because many customers are wary of returning to the high street in a post-pandemic world; critically, from an operational perspective, cloud-based solutions reduce retailers' overheads when it comes to managing a complicated IT infrastructure while providing highly powerful resources delivered in a flexible consumption model.

It is essential then that bricks-and-mortar retailers look to adopt such solutions for their digital transformation process.

Detail in the digital change

Many local retailers have already discovered to their advantage how a series of analytics-driven, cloud-based technologies can support a massive demand in online shopping. The technologies that underpin their ability to deliver their online offering typically include an Elastic Compute Service (ECS).

As its name suggests, this provides an elastic and secure virtual cloud server for seamless and cost-effective scalability, which is just what’s required when events like a pandemic causes online traffic to shoot up.  Meanwhile, an on-demand database hosting service with automated management, backup, and disaster recovery capabilities, gives retailers peace of mind that their platform is robust.

Another key asset here is a Content Delivery Network, which is a multimedia content delivery service that can reach users across the globe. The beauty of the internet of course is that customers for your business or the services it provides need not be restricted by geographical boundaries.

The cloud also offers a host of essential security solutions and provides comprehensive compliance and protection against a range of ever-present security threats. For businesses with ambitions to expand, the Cloud Enterprise Network provides them with the connectivity they need on both a regional and global bases.

Cloud computing is the foundation for digital change. In a bricks-and-mortar business model, there are orders, customer profiles, payments, product assortments, marketing information and supply chain processes, etc. —all of these can be digitalized to provide a seamless online and offline shopping experience for customers.

Given how competitive and challenging the retail sector is, the decision to make the cloud a part of your digital transformation journey could well have a bearing on the success of your retail business.

The cloud route to optimized customer experience

Of course, consumers still consume even when physical stores are closed. Here, technology has worked to recreate a fabulous in-store experience while consumers order online. In most cases, this has been achieved through harnessing cloud-computing capabilities, in a bid to provide brands with the technological infrastructure needed for them to better meet their customer and business needs. 

The beauty of cloud-based solutions is that they enable retailers to automate infrastructure updates and maintenance as well as utilize auto-scaling to respond to fluctuating demands. They also benefit from digitized inventory and supply chain systems, trend insights and mobile payments, which combine to play a part in meeting customer expectations.

A search that goes beyond words

Meanwhile, back at “the store,” some products - like Alibaba Cloud’s Image Search and Machine Learning Platform for AI - have transformed the way that customers interact with sites and how they shop for products. These technologies provide the necessary insights and real-time information to optimize customers’ shopping experience.

For example, a precise search would enable shoppers to search more accurately for items using an image, rather than by typing in a vague keyword into the search box. Therefore, retailers can implement image search as an added functionality to improve the effectiveness of search results.

An image search enables customers to upload a photo or a screenshot of the product to easily find similar or identical products. Image Search is a technology that utilizes machine learning and deep learning to analyze images, find desired products, and fulfill search requests quickly and conveniently.

Customers sometimes browse for unspecified items. With customized discovery, Filipino shoppers benefit from seeing personalized recommendations based on their interests or needs. According to a report from Dentsu International (previously Dentsu Aegis Network), in collaboration with eConsultancy, 88% of centennials or Generation Zs alone expect to be able to find products online easily.⁴

Livestreaming is also another useful tool to drive sales, especially during the pandemic. In the Philippines’ retail sector, it is a technology that is being used more frequently and in more innovative ways.

Additionally, the middle-end solution can alert retailers if a specific product is trending on social media and allows them to create reports for further analysis. Its machine learning capabilities provide forecasting abilities to enable better future planning. This allows retailers to forecast how many users to expect on their website.

An offer you can’t refuse

One interesting development surrounds how can insights can be used intelligently to guide customers to the best deals and offers at a time when many families will be watching their budgets more carefully than ever.

To that end, digitalization and machine learning capabilities can enable a better shopping experience, helping customers seamlessly connect with relevant brands and retailers.

Equipped with cloud-based consumer insights from an e-commerce platform, retailers can more effectively acquire, engage, and retain customers through campaign testing, targeted marketing and a personalized user interface.

This allows consumers to get highly relevant content along with personalized shopping recommendations. A typical example is how online product recommendations provide suggestions on what items to buy. They do this by analyzing past consumption history.

By leveraging the capabilities of the Infrastructure as a Service (IaaS), along with the Platform as a Service (PaaS) and Software as a Service (SaaS), the cloud technologies can also help retailers develop and execute more effective online-to-offline strategies, which include offering their discount vouchers on social media platforms to be used in physical stores.

Keeping stock of it all, all year round

Waves of panic buying in the Philippines roused by the subsequent lockdowns depleted some in-store and online stocks. When stocks of essentials supplies are low, technology can be used to steer customers to retailers who do have the essential supplies they need.

This is supported by smart inventory management solutions for asset and inventory tracking to gain supply chain visibility.

From a retailer's perspective, these solutions can save them numerous working hours cataloging items and conducting stock-taking activities. Retailers can also automate the management of assets and inventory from procurement through to the distribution stages.

With automation, retailers can match inventory and order status in real-time, and offer suitable delivery options to customers.  They can also provide the ability to organize inventory and maximize their warehouse space.

While COVID-19 has given every single sector a considerable jolt, it has also been an opportune time for retailers to use cloud-based technology to help finesse their online and offline offerings to meet the expectations of the post-pandemic consumers.

Notes:

1 The Coronavirus Forces the Philippines’ Online Economy to Catch Up to Its Southeast Asian Peers
2 Registration of online businesses jumped from 1,753 in Jan-Mar to more than 75,000 by end-August - Trade Chief
3 Keynote Speech of Secretary Ramon M. Lopez, Virtual Launch of Philippines E-Commerce Roadmap 2022
4 Here Comes The Centennial: Southeast Asia's New Generation of Shoppers