Build the Store of the Future: Retail and the Cloud

By Greg Deckler, Vice President of Infrastructure - 8 Jan, 2024
6 Minutes Read

Recent times have seen brick-and-mortar retail stores, especially chains, struggling for sustenance amidst the looming financial crisis. A study by CB Insightsindicates that famous brands, such as Bed Bath & Beyond and JCPenney, are bankrupt, and many other stores are downsizing their presence due to lower sales and high operational costs. While online shopping had a massive surge during the pandemic, retail stores that did not have a substantial online platform felt the heat.

 Established, once-beloved stores face irrelevance or extinction as more people shop online. However, by transitioning to cloud applications and E-Commerce platforms for retail, businesses can reduce costs, improve relevance, and keep customers coming back.  

Recent times have seen an increased number of customers preferring online sales, with a study by Statista2 indicating that E-Commerce penetration into consumer sales, which is around 80% now, is set to increase to 93% by 2028. These statistics show the much-needed shift for retailers to have an online presence and leverage the extensive benefits of a cloud-hosted selling platform. 

The Extinction of Newspapers

Like brick-and-mortar retail stores, newspapers were an essential part of daily life for hundreds of years, and owning or operating one was a stable, reliable method of building wealth and influence. However, the past few decades have seen thousands of once-profitable newspapers shut their doors.  

This path to extinction started with the invention of the first web browser in 1993. In only 15 years, Craigslist, Facebook, Twitter, and online national services pulled people away from their local newspapers. When customers started canceling subscriptions, advertisers also moved their money to online platforms.  

But it wasn’t just the arrival of the internet that caused newspapers to fail. The problem was that newspapers either underutilized or completely ignored it until it was too late to change the tide against them. Now, brick-and-mortar stores face the same challenge, but adopting cloud applications for retail will be vital to preventing another mass extinction.  

Reacting and Leveraging Technology Changes

To stay relevant and keep their doors open, traditional retailers, both small and enterprise-level companies alike, must react to economic and societal trends while leveraging their strengths over online shopping.  

Let’s look at the challenges and factors that retail stores need to consider:

  • The affordability and accessibility of mobile devices make online shopping more convenient.
  • The remote-working model has lessened the need for physical travel and made customers shop online.
  • The increased reliance on technology and Demographic changes needs retailers to move towards digital transformation.
  • Consumer behaviors related to price sensitivity and changing buying preferences call for agile technological solutions such as Artificial intelligence, Machine Learning, and Predictive Analysis.
  • Consumers need a seamless and holistic shopping experience, with a gradual shift towards cashless transactions.

While a retail store may struggle to adapt to these factors, they aren’t insurmountable. They can leverage several key strengths that will keep customers walking through the doors:

  • Local physical presence serves an immediate need
  • Friendly customer service 
  • Opportunity for customers to physically interact, experience, and see products

Using Cloud Native Applications for a Retail Store of the Future  

While E-Commerce can be a supplemental opportunity to drive more revenue into the company, having a subsidiary and an inadequate online presence won’t be enough to keep a company successful. Instead, by transitioning to cloud-native applications, retail stores can improve customer experiences, streamline operations, and reduce costs to ensure the company can survive and thrive. You can choose our vast portfolio of cloud-based services to make the right shift.

Let’s consider what a store of the future, like the one illustrated above, could be like. As potential customers get within certain proximity of the store, they receive a notification on their phone of a flash sale. The customer stops by the store and sees what they want, and, using the store’s mobile app, they scan the product, pay, and leave with it. The whole experience is fast, simple, and seamless. 

For this scenario to occur, retailers need several components:

1. A Mobile Application

A robust mobile application can automate the notification through geofencing, a location-based service that triggers a response when the device enters a virtual perimeter. The application can create flash sales on overstocked products or dynamically increase the price of in-demand items using real-time inventory.

For this to work, a mobile application, cloud platform, and APIs will work together to support the purchasing, inventory reconciliation, and automated marketing efforts. At the same time, cloud services will collect IoT data from mobile devices and in-store sensors to improve retailer strategies and influence customers to purchase.

2. Robust Data Strategy

To ingest and process high-velocity data and build or adjust strategies in real-time, retailers need a solid data strategy in place. Typically, retailers only know what happens within a particular store the next business day after the point-of-sale systems have uploaded data and overnight batch processes have loaded the data into data warehouses for reporting purposes. This delay can lead to missed opportunities and sales, where a cloud-based inventory management system will fill the gap.

3. Mobile Point of Sale

Having an intuitive, immersive mobile application that customers can use to purchase products is more than just convenient. It offers the retailer the opportunity to retire traditional point-of-sale systems, which offers several benefits:  

  • Increased velocity of sales and inventory data
  • Single sales engine for both online and store sales
  • Elimination of complex and expensive point-of-sale systems
  • Reduction in headcount or repurposing of headcount to improve customer service
  • Decreased dependency on staff and a corresponding reduction in scheduling complexities
  • Ability to target customers with personalized offers and incentives

Cloud Solutions for Retail Stores Can Protect Your Business

While future-proofing a retail store requires a different data and technology strategy, changing business processes and decision-making will be vital to keeping your company solvent. To know on how you can benefit from our cloud-based technology solutions, contact us, and we will be glad to help. 



Author: Greg Deckler, Vice President of Infrastructure

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