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Digital transformation focus shifts to customer experience

Author: Miya Knights

If industry events are anything to go by those held most recently underline the fact retailers have realised the strategic importance of digital transformation: it was a major theme from the Retail Week Tech. event held in London this week, for example.

Facing increased economic uncertainties and pressures, retailers could perhaps be forgiven for looking for cost savings and efficiencies first from any digital technology investment. But it became very apparent from discussions at the event that increasing efficiency and productivity in the back office will only get you so far without using its benefits to also create a digitally-enabled, consistent retail CX both online and instore too.

Colin Light, Digital Consulting Leader at consultancy PwC, was at Tech. to share the findings of research into the barriers to digital transformation in retail. “Retailers are pouring far too much money into maintaining what they’ve already got, when what they should have is a strategy to engage customers wherever they are.”

The PwC research found that cultural change and getting retail people to adopt new tech-driven processes and practices were the biggest barriers to digitally transforming their businesses, followed by legacy technology challenges. A lack of connectivity between sales channels emerged as the third most impactful barrier to digital change.

Light suggested that retailers should follow the example set by retail banking in digitising the CX, in-branch as well as online, via mobile and apps. But, he added: “Government regulation created the right conditions to incentivise the banks to digitally transform. Retailers now need to pivot their operating models to incentivise the right behaviours from both their own people and customers in a similar way.”

There was some good news for UK retailers particularly though, as research debuted at the event by PlanetRetail RNG revealed they were ahead of their European and US counterparts in internationalising their businesses; so much so, that JD Sports ranked higher than Apple in terms of its ability to cater and deliver to international customers with local ecommerce payment options, sophisticated order tracking, and click and collect capabilities.

Rob Gregory, PlanetRetail RNG research director, said digital transformation was a prerequisite to enabling cross-border trade as an essential catalyst for future growth. “Cross-border commerce will account for 29% of modern retail sales by 2023,” he added.

Personalisation also featured high on the event agenda as one of the key benefits of digital transformation. Dicken Doe, CX and analytics VP, CapGemini, commented: “The technology is getting more and more sophisticated. But it’s not doing a lot to help retailers understand what a good CX should look like. Retailers need to harness the ability to understand their omnichannel customer engagement at an emotional level and tie that back into the customer offer in the design and process orchestration stages.”

There was a general consensus among all of speakers that retail still has some way to go in applying the same levels of visibility available from digitally transformed supply chains, for example, to the CX. Shehnaaz Chenia, Ecommerce Development Director EMEA, LEGO Group, echoed the PwC research findings by advocating the measurement and monitoring of the CX experience across all digital touch points, including marketing and promotions online and instore.

“The two biggest barriers to digitally transforming and optimising the CX are organisational change and knowing where to prioritise their efforts,” Chenia said. “This is where it is important to capture the voice of the customer to understand the why of CX improvements, as well as the what.”

David Aylmer, Eagle Eye’s own Chief Operations Officer, was also on hand to explain how we’re using Rackspace technology and services to support our own business growth. David described how this work is, in turn, helping Eagle Eye’s retail, food and beverage and brand clients deliver performance-driven marketing and promotions to inform their understanding of who their customers are and what they want.

David pointed out that Rackspace-enabled IT scale and growth facilitates Eagle Eye to serve a client like Greggs, with 1.15m downloads of its loyalty app running on Eagle Eye technology, which drives an average promotional redemption rate of 35%. If Eagle Eye is having to digitally transform to keep pace with its clients, the message came through loud and clear it has become imperative that retailers must quickly do the same.