The digital demands of 2020 on UK retailers

In the age of data-driven retail, businesses know their customers better than ever before. In order to remain relevant and competitive, it’s essential that retailers create tailored experiences and personalise their interactions with shoppers. Whether it’s through a customer’s online profile or store card details, personal data is the lifeblood of customer-centric retailers.

Recently, digital growth for retailers has increased exponentially following the lockdown and restrictions on bricks-and-mortar retail. Whilst every retailer strives to simplify their operations by embracing technology such as artificial intelligence (AI), Internet of Things (IoT) and robotics, at the heart of all these solutions is data.

Yet, despite understanding the importance of data, many organisations are unaware of how precarious a position their data management and infrastructure are in. We hear all the time about organisations accidentally leaking data and breaches from hackers putting valuable information at risk.

But effective data management and protection is easier said than done. The scope of modern data protection and management has become an increasingly complex issue – from downtime, gaps in availability and protection, to full-blown cyber-attacks, there’s a lot for retailers to contend with.

Minding the gaps

In May this year, the Office for National Statistics reported that a third of retail sales took place online – the highest proportion on record. The pandemic has left many retailers with no choice but to offer an online-only retail experience in the hope of meeting the demands of consumers who now expect an ‘always-on’ service when shopping online.

That said, our Veeam 2020 Data Protection Trends Report found that 95% of global organisations experience unexpected outages, with at least 10% of their servers having at least one outage per year. With the average outage lasting just under two hours, that’s a serious impact on retailers’ ability to provide the services their customers expect.

As recently as March this year, an attempted cyber-attack on a well-known UK pharmacy loyalty card scheme saw the system temporarily disabled. Whether it’s loyalty schemes, websites or customer support tools, service outages of any kind can have a knock-on effect for overall customer satisfaction, trust and business growth. Knowing how to manage, protect and access this information is key to delivering on consumer expectations.

We asked UK businesses to tell us the biggest challenges they expect to face in the coming 12 months. Issues around economic uncertainty (33%), cyber-threats (32%) and meeting changing customer needs (32%) were the most cited responses. There’s still a considerable amount of uncertainty about what the next few months and years will look like for the future of retail. However, ensuring that they are able to solve these challenges and adjust to the modern demands of data management will enable them to respond quickly and effectively in future.

What’s holding retailers back?

Across the UK, almost half (49%) of respondents said that a lack of IT staff skills or expertise was to blame for their organisation’s slowed digital transformation – 5% higher than the global average. Additional responses cited include dependency on legacy systems (43%), limited budgets (31%), lack of time (29%) and a lack of buy-in from senior management (26%).

For retailers to flourish in today’s climate, digital transformation is the path to the future – and optimising infrastructure and supporting cloud-based capabilities is key to that journey. More than half of those surveyed (51%) said digital transformation is how they plan to transform their customer service. And it’s a similar story when it comes to transforming business operations (48%) and delivering cost savings (47%).

Many are already on their journey towards implementing or planning the early stages of their digital transformation initiatives. But it’s crucial that this importance is understood throughout retail organisations, at all levels of the business. It’s the only way to impact growth in both the short and long term.

The true cost of downtime

Regardless of how different businesses rate their own digital transformation progress, everyone shares the same pitfalls. Almost all businesses (95%) experience unexpected outages, with the global average lasting around 117 minutes. Similarly, one in 10 global servers suffered at least one unexpected outage within the last 12 months.

When downtime occurs, this impacts retailers’ bottom lines. Global organisations consider on average more than half (51%) of their data as ‘high priority’. So when a high priority application experiences just one hour of downtime, it can cost an estimated $67,651.

Not only can a few minutes offline cost the largest retailers millions of pounds, increasingly, shoppers are loyal to experiences rather than brands in our digital economy. Retail brands such as Amazon and John Lewis have both experienced outages across their eCommerce platforms which led to a downturn in business, proving that no company is immune to experiencing downtime.

Data availability is critical to business continuity for today’s shops and shoppers. Retailers must be present across multiple platforms, whether that’s their eCommerce websites or through mobile devices such as smartphones, tablets and smartwatches.

The digital customer experience is the first line of customer service for retail brands – with the power to nurture customers for life or turn them away forever. The move to ‘always-on’ shopping therefore needs to be a priority. And with that comes the need for retailers to meet the data demands of this new era in order to flourish.