Not long ago, it would have been unthinkable for a makeup store to offer its own credit card. Yet today, companies like Sephora and Ulta Beauty are seamlessly blending financial services into their beauty offering. As retailers increasingly make innovative strides into spaces once considered outside their purview, the question begs: What is the next frontier in customer experience? Are retailers missing out by not tapping into the power of telecom?
From Brick-and-Mortar to Data-Driven
Today we stand on the brink of a revolution in retail – an era where data plays a pivotal role in shaping customer experiences. The retail industry has always been in a state of constant evolution, driven by consumer behaviors and technology advancements. In the recent past, we’ve seen retailers transition from brick-and-mortar to e-commerce, and then to omnichannel, all while extending their reach into new innovations like augmented reality, artificial intelligence and financial services. Store credit cards, once a novelty, are now a standard offer driving customer loyalty and increasing purchase frequency.
Now the stage appears set for another tectonic shift – harnessing the power of mobile telecom. Telecom presents a unique opportunity for retailers to connect with their customers on a deeper level. And unlike credit cards that require credit checks that will disqualify some customers from participating, the only barrier to entry for telecom is a mobile device. According to Statista, in 2021, nearly 8 out of 10 households in Mexico owned a mobile phone. This accounts for roughly 100 million+ mobile phone users in Mexico.
A Window into Consumer Behavior
In terms of how much time Mexicans spend on their mobile devices, a 2019 survey found that the average Mexican spends 3 hours and 30 minutes on their mobile phone per day. This is significantly higher than the global average of 2 hours and 25 minutes.
Similar to credit cards, which help retailers understand their customers behavior and offer tailored experiences, telecom opens new avenues for personalized service and targeted marketing. Furthermore, it opens up the possibility for all kinds of customer benefits from exclusive deals and early access to new products to personalized recommendations and experiences.
Unlocking Consumer Insights with Telecom Data
For retail companies, telecom data offers an incredibly rich, previously untapped source of consumer insights. Retailers can gain insights into buyer preferences, habits, and behaviors in real-time. As global regulations cut down on third-party cookies, the ability to safely and securely collect first party data with user consent will be imperative in the race to the top of retail. With a better understanding of your customer, you can tailor your offers to fit their precise needs and support them in their buyer journey.
Innovating Rewards: The Data-for-Reward Model
Moreover, retailers can take advantage of telecom’s inherent capabilities to introduce innovative rewards systems. For example, offering free data as a customer reward can result in a win-win situation. Customers get something of real value while retailers get the benefit of increased brand engagement and loyalty. The data-for-reward model could potentially revolutionize the traditional points-based rewards system, providing a more meaningful and timely benefit for the modern consumer.
Today the technology is ready for retail, but the question is are retailers ready for transformation? And which retailers will be the first to market embracing this opportunity the same way they’ve welcomed financial services into their offering?
Embracing Telecom in Retail
It’s clear that telecom presents a massive opportunity for retailers. Still, it requires a fundamental shift in mindset, strategic planning, and investment. The retailers who are willing to take on this challenge and seize the opportunity to innovate will have access to significant advantages that range from a more complete picture of their customer to an unprecedented new take on their competitive landscape.
The conversation around the fusion of telecom and retail is still in its early stages, however it’s crucial for retailers to start considering how this channel can help them respond to a quickly evolving market. Similar to how they previously assessed the integration of financial services like credit cards, buy-now-pay-later schemes, the transition to e-commerce, and even the development of their own apps. Early adopters will set the pace for this transformation, and those who lag could find themselves playing catch-up in a rapidly evolving marketplace.
Navigating the New Retail Era: Adapt or Fall Behind
So, as we ponder the question – “Is telecom the future of retail?” – it might be prudent to consider another question: “Can retailers afford to ignore the possibilities that telecom offers?” The answer to both might just shape the future of the retail industry. As we have seen time and again, those who adapt and innovate are the ones who thrive.
The digital age has shown us that boundaries between industries are more permeable than ever before. As former retail giants like Bed Bath & Beyond and Sears will tell you, the future waits for no one. A stark reminder that in this fast-paced, technology-driven world, adaptability isn’t just an asset – it’s a necessity for survival.