The year 2020 upended retail businesses more than any other time in recent history, as people shifted their entire lives (and buying habits) online in response to COVID-19. At Crate & Barrel, where online sales already accounted for more than half of our business, we’ve seen online sales jump more than 40% since the start of the pandemic.
Currently, they are more than 65% of our overall business.
The disruptions were unparalleled and unexpected, driving lightning-fast pivots in strategy and execution to meet customers where and how they wanted to shop. Organizations had to accelerate digital transformation initiatives to survive, allowing them to bypass former barriers and reach long-term goals much sooner than expected.
As we look ahead, we at Crate & Barrel see an even bigger revolution on the horizon—one marked by digital and physical engagement fused together to form an entirely seamless and highly personalized ecommerce experience. This is made possible with our use of data analytics technology to offer more personalized, immersive experiences for our customers, with embedded machine learning to help Crate & Barrel navigate this dynamic retail world.
Consumer-centric execution requires more inspirational experiences across digital and physical
The distinctions of online and offline experiences are increasingly blurred. For example, curbside pickups of digital sales are one way the store and online experiences are connected. Similarly, our physical shopping catalogs have become more personalized thanks to rich customer data via online channels, which in turn allows us to customize direct mailers for different target consumer groups.
Still, customer interaction in each domain is different. Physical stores offer more “inspirational” experiences, inviting shoppers to come in and explore, spontaneously discover products, and imagine design possibilities for their own homes. Digital retail, on the other hand, is generally more personalized and guided, but currently lacks the tactile discovery that gives life to in-person shopping trips—trips where shoppers can physically interact with products and get personalized recommendations from sales associates based on lifestyle.
This speaks to one of the most significant challenges for online retailers when crafting a customer experience: bridging the gap between browsing a website and walking through a physical store. It’s been a constant evolution as technology and capabilities have changed. Early websites tried to replicate the store experience using search to help people find products, categories to guide discovery, and navigation to direct visitors to specific pages. And while website design has modernized aesthetically and new customer engagement features are constantly being introduced, the structure itself has remained relatively unchanged.
As external influences and new technologies come into play, companies should be taking advantage of the opportunity to completely reimagine the customer experience. Finding a way to marry the inspirational nature and knowledge of physical retail with the richness and personalization of online retail—this is the future of online shopping.
Related: Get research insights and tips to add resilience in retail. Download report
Cloud technology powers the revolution of seamless retail experiences
We are at the start of a new era of retail experiences that go beyond the idea of using digital to simply reinforce physical experiences. Instead, the new focus will be on leveraging design and data to architect more inventive, creative, and inspirational experiences—both online and offline—and finding ways to bring the best of both together.
A big part of this digital shopping revolution is being powered by cloud computing. The cloud makes it easier to gather and analyze large amounts of data from diverse sources like customer traffic information in a physical store, mobile shopping patterns, and other online purchasing behaviors—all in an effort to help us better understand customer pain points and how we can remove friction to continuously improve the modern shopping experience.
The speed and flexibility of the cloud, particularly when it comes to breaking down traditional data silos, is a clear advantage. To achieve a rich, personalized customer experience, it’s critical that organizations gather the right data in real time from their various touchpoints and then create a single data source that represents a full view of the customer.
At Crate & Barrel, we rely heavily on Google Cloud’s BigQuery data warehousing and analysis tool to save time preparing data sources. Thanks to its ease of use, we draw on 10x more information sources compared to a few years ago, which are then analyzed and transformed into actionable insights that can be used to influence the customer’s next interaction. And this, in turn, drives revenue. In addition, BigQuery’s ML capabilities enable us to develop more models and recommendations at scale without raising costs or overloading resources.
For instance, by mining omnichannel data about our customers’ shopping habits, we successfully redirected direct mail investment into personalized digital advertising with little friction and double digit incremental returns. Digital ads allow us to gain rich insights about current and prospective customers that we leverage to refine messaging strategies across channels, as well as to drive omnichannel CRM. We have created an omnichannel view of our customers utilizing online and offline data that we use to constantly improve the customer journey at key interaction points weaving throughout digital as well as offline experiences.
The data synergies across Google platforms have allowed us to better leverage contextual data to optimize and improve our ad effectiveness as we continue to scale our investments, which helped us double our return on ad spend (ROAS) while increasing our investment by 20%.
What’s coming next
The future of shopping places more emphasis on technology teams, as well as designers and marketers, to innovate at a pace faster than today’s modern consumer. Fortunately, moving data among different repositories in different clouds or deploying data analytics enables teams to be nimble and react quickly.
Beyond marketing, we’ve already started using BigQuery to reveal more customer insights and opportunities for improvement throughout the ordering process. Whether it’s at product origination or last mile delivery, we are striving to create transparency and frictionless experiences throughout the product lifecycle. How organizations use data to augment both digital and physical business operations is set to transform all industries, not just retail. We have an opportunity to create a strategic advantage in our customer experience—and it all starts with data.
Read this next: Beyond COVID-19, retail looks to transform with AI/ML
About the author
Nari Sitaraman is the Chief Technology Officer at Crate and Barrel Holdings, Inc., a global home furnishings retailer. Nari brings more than 20 years of retail and consulting experience across technology, strategy, and product management, and has led various top brands through successful digital transformations. Currently, Nari oversees all technology functions for the company and its portfolio of brands, and helps define and deliver on customer experience and technology related strategies and investments.
Most recently, Nari served as Chief Technology Officer at The Shade Store, a privately held retailer that specializes in custom window treatments. In that role, Nari helped grow the business 4x during his tenure that led to a successful sale to Leonard Green & Partners. Prior to The Shade Store, Nari was with Williams-Sonoma, Inc., where he led the re-engineering of large legacy systems and helped foster a culture focused on omnichannel customer experience, technology innovation and agility.
Nari holds a Master of Business Administration from the University of California at Berkeley, Walter A. Haas School of Business. He also earned a Masters of Science from The Pennsylvania State University at University Park and a Bachelors of Technology from the Indian Institute of Technology at Madras, India.