PETALING JAYA: The disconnection between online and in-store transaction data is hampering retailers’ ability to understand consumer behaviours and preferences, impeding decision-making in an increasingly competitive market.
Adyen country manager Lee Soon Yean pointed out that the findings from the Malaysia Retail Report 2023 revealed that 35% of Malaysian businesses use a customer relationship management (CRM) system to curate stronger personalised journeys, while 32% have centralised databases showing sales from all channels.
“This leaves only 32% of retailers who can connect online and in-store transaction data. Here’s what the disconnection between sales channels means for retailers: they are missing out on valuable shopper insights,” he told StarBiz.
He explained that the same customer could be shopping through the retailer’s online site, their mobile app, or even in physical stores.
Unfortunately, retailers often struggled to connect these transactions to the same individual, resulting in an incomplete view of the shopper’s journey, he added.
It is common for retailers to run their physical stores and online businesses separately, which often leads to using different providers for online and in-person payments, resulting in distinct sets of reports for finance teams to manage.
This, he emphasised, would bring operational challenges for the finance team as the company grows.
According to him, many merchants are seeking to simplify these processes by integrating online and offline payments.
“This practice allows all payment data from different channels to be consolidated on a single platform, enabling retailers to deliver diverse cross-channel experiences, simplify reconciliation processes and gain in-depth customer insights,” he noted.
Asked about challenges for retailers in adopting unified commerce, he explained that as an omnichannel retailer, one must be able to get order fulfilment right, regardless of the channel customers make their purchases from.
He said retailers should integrate in-store point of sale systems to online commerce platforms for CRM.
“Retailers also have to synchronise order management and stock management.
“And because many retailers traditionally have separate teams for their in-store and ecommerce businesses, these teams now have to unite and work closely together,” he added.
Lee said connecting payments to backend systems would provide real-time inventory data, facilitating smoother order fulfilment and unlocking valuable customer insights
On a positive note, he said the annual retail report revealed that almost half of businesses have plans to invest in connecting backend systems to customer-facing channels, an 88% increase from last year.
Moreover, a total of 55% of businesses plan to invest in technology to improve the overall shopping experience.
Meanwhile, Lee said based on the report, 66% of shoppers exhibit greater loyalty to omnichannel retailers, which enable seamless shopping experiences across online and offline channels.
According to the report, 83% of retailers said physical stores are important for brand consideration, even if consumers make their purchases through other channels.
“In recognition of this trend, Malaysian retailers are embracing omnichannel strategies to provide seamless experiences across multiple touchpoints.
“This approach integrates online and offline channels, allowing customers to browse, purchase, and return products through various platforms,” he added.
On challenges that retailers encounter when striving to expand their business, Lee highlighted two key aspects.
Firstly, for successful international expansion, retailers must cater to the preferences of local audiences, such as offering specific payment methods like PayNow in Singapore or various e-wallets in Malaysia.
Failure to do so could lead to losing customers with preferred payment methods, with up to 55% of customers in the country potentially abandoning carts, according to Lee.
Secondly, Lee emphasised that complex reporting, especially when dealing with different providers for online and offline sales channels, can hinder the speed of expansion.
Managing numerous reporting formats would become an operational headache for finance employees, he added.
“Therefore, partnering with the right financial technology (fintech) provider becomes crucial to streamline reporting processes, especially as businesses scale in different markets,” he said.
Adyen, a fintech platform, offers end-to-end payment solutions and financial products globally, allowing businesses to consolidate payments across all stores, markets, and channels into a unified system.
Adyen would assist merchants enhance revenue, improve customer experiences and manage payment processes through its all-in-one platform.
