This success story is about Auchan embarking on a collaborative journey with DRUID to establish new benchmarks for operational efficiency and growth.
Auchan, one of Europe's largest retailers, embarked on a collaborative journey with DRUID to successfully navigate a challenging retail environment and establish new benchmarks for operational efficiency.
The story of retail closely parallels the trajectory of human development. Trade, a practice that predates the concept of currency, can be traced back as far as 9,000 BC. Across millennia, the retail landscape has undergone profound transformations, with some of the most significant changes occurring in the past two centuries. We've transitioned from modest community-based mom-and-pop stores to bustling urban department stores and convenient supermarkets. Each phase of retail's evolution mirrors the broader progress of society itself.
Shopping malls, for example, revolutionized our patterns of socialization and leisure, while the emergence of big-box retailers marked an era defined by mass consumption and affordability. More recently, the advent of the internet has ushered in the age of e-commerce, leading to a fundamental reshaping of the retail landscape once again. Today, consumers have a myriad of retail options at their disposal, reflecting the dynamic nature of the industry and the ever-evolving preferences of modern shoppers.
"In many ways, retail serves as a reflection of society, capturing even the subtlest shifts in its dynamics. When optimism and strong consumer confidence prevail, sales soar, but a moment of consumer uncertainty can swiftly reshape shopping behaviours. Europe presently grapples with record-high inflation rates, stagnant wages, and ongoing geopolitical uncertainties, prompting individuals to reconsider their spending choices and financial allocations. This pattern reverberates across our diverse range of retail clients, whether they deal in everyday convenience items or specialize in niche products. Consequently, there is a growing emphasis on enhancing productivity and efficiency in response to this shifting landscape." Andreea Plesea, who is DRUID's Chief Customer Success Officer and co-founder, was one of the first to meet with Auchan and discuss the company's needs and wants from the collaboration.
"As consumers keep a close eye on their expenditures, retailers find themselves confronted with a pressing question: How can we innovate and optimize our operations to serve consumers better and secure their loyalty, even amidst challenging circumstances? This is the very question that kick-started our discussions with Auchan."
The rapid changes of recent years further complicate the contemporary retail landscape. The retail sector has, it is estimated, witnessed more disruption in the past five years than it did in the preceding 25. What makes this period unique is that all key stakeholders—customers, suppliers, employees, and investors—have simultaneously undergone significant shifts in their behaviour and expectations.
Customers, for instance, have evolved from casual browsers into price-conscious shoppers who prioritize speed, sustainability, and a seamless digital shopping experience. Employees also seek a different work environment characterized by greater flexibility and support. As a result, traditional retail methods are gradually fading into the background.
In the face of this unprecedented industry disruption, retailers must take proactive measures immediately. These actions could very well determine whether they emerge as industry leaders or lag behind in the next two decades, as noted by McKinsey. It's within this challenging context that Auchan turned to DRUID for solutions.
"As a customer-centric business, we stand by our customers at every stage of their lives and shopping journeys. Whether online at midnight, in a hypermarket on a Saturday, using automated mini-stores round the clock, or simply visiting the My Auchan convenience store downstairs, each Auchan Retail experience is unique. Our product and service offerings vary, just as the interactions and emotions do. This diversity is not only changing lives but also enticing customers to return". Auchan further explains, "Our 'multiformat phygital' model combines four physical brick-and-mortar retail formats with e-commerce, reimagining the shopping experience to meet customer desires."
While this complexity benefits consumers, it can pose long-term management challenges without robust processes and technology and place undue pressure on internal teams. Ideally, such an occurrence should be avoided.
"Auchan operates an extensive data system, which manages information from numerous applications. On a daily basis, it serves tens of thousands of clients while overseeing the management of millions of products, prices, and stocks. Despite the seamless customer shopping experience, it conceals a colossal operational effort.
In such an intricate environment, any disruption in one part of the system can cascade through the entire process—a significant concern in today's fast-paced world where delays can lead to substantial financial consequences. While external market conditions may present challenges, Auchan recognizes its ability to influence its internal operations. This realization has spurred a collaboration with DRUID to optimize its operations, enhance collaboration, and improve the acquisition and utilization of information among its staff", Andreea further explained.
A conversational AI-powered virtual assistant emerged as the ideal solution that met all the requirements. Named "Felix," this conversational tool took centre stage within Auchan's IT systems. Its role was to centralize employee needs and inputs, efficiently guiding them without delays or errors. Felix's capabilities span from streamlining workflows and facilitating information access to optimizing inventory management and providing IT support. It has, in essence, harnessed the retailer's internal technology ecosystem's full potential. Today, it serves as the primary point of contact for any employee-raised ticket, regardless of its content or origin.
Moreover, Felix also acts as a platform to enhance engagement with Auchan's external partners. Leveraging advanced AI capabilities, this virtual assistant enables automated communication and seamless data exchange, fostering collaboration and operational efficiency.
Felix successfully resolved 6,000 tickets over 12 months, leading to a remarkable 40% improvement in SLA response times, consequently boosting user satisfaction among Auchan employees. Furthermore, Felix brought over € 120,000 from retaining customers.
To enhance customer service and support employees, the project team seamlessly blended Auchan's deep retail knowledge and thorough comprehension of challenges and requirements with DRUID's versatile technology platform. Auchan's transformative approach, which brought scalability, swiftness, and AI-driven insights across various channels, is an instructive model for the retail industry.
Conversational AI holds immense potential for the retail industry, and its impact is just beginning to unfold. Its applications continue to expand daily, explaining the increasing adoption by businesses. According to a recent report, the global conversational AI market is projected to grow from $10.7 billion in 2023 to $29.8 billion by 2028, primarily driven by its ability to revolutionize customer experiences.
Retailers are poised to encounter new challenges in an uncertain economic environment with mounting customer expectations. To thrive in this ever-evolving business landscape, retailers must prioritize customer loyalty and deliver outstanding shopping experiences. By embracing conversational AI, retailers can craft personalized experiences that resonate with customers. Thus, 2023 marks conversational AI becoming an indispensable tool for retail enterprises, enabling them to enhance efficiency and excel in a dynamic market. Auchan was, undoubtedly, an early adopter and will reap the benefits.
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