Impact of Digitization on Customer Experience: Chanel Australia Report

This report investigates the impact of retail digitization on Chanel Australia, aiming to identify how it enhances customer contact and improves the retail experience. The report addresses key research questions, including the strategies employed by Chanel Australia to digitize its retail experience, the anticipated impacts of digitization on the luxury brand, and recommendations for enhancing the customer experience. The literature review explores the evolution of digital platforms and the importance of digital engagement in the retail sector. The report examines how Chanel Australia utilizes digitization to improve customer support, create personalized product experiences, and leverage data for customer interaction. The report also assesses the impact of digitization on customer behavior, including price transparency and the influence of peer recommendations. Finally, it provides recommendations for Chanel Australia to remain competitive in the digital landscape, emphasizing the need for digital transformation, skill development, and rapid decision-making.

Professional Project

Running Head: Report
Contents
Introduction.................................................................................................................................................2
Research Background..................................................................................................................................3
Research Aim..............................................................................................................................................4
Research Questions.....................................................................................................................................4
Literature review.........................................................................................................................................5
Research Methodology..............................................................................................................................12
Findings.....................................................................................................................................................15
Discussion.................................................................................................................................................15
Limitations................................................................................................................................................15
Conclusion.................................................................................................................................................16
References.................................................................................................................................................17
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Introduction
Businesses have already realized that digital engagement and innovation has a crucial impact on
and they must use a different medium to engage with their customers in order to drive the
conversation and maintain the relevance. But only a few businesses realize how swift the
transformational changes need to happen. Today, everything in the world is getting digitized and
every business needs to implement the strategies which pursue innovation so that before the
competition disrupts their business model, they must implement the strategies. This report is
written to respond to the research questions like the identification of the impact of a detailed
digitization on the contact in customer point of view and ameliorate the retail experience for
channel Australia, evaluation of the various strategies undertaken to digitize the retail experience
for the customers, assessment of the anticipated impacts created by digitizing the retail sector,
and the recommendations on required measures for improving the luxury retail experience and
creating inconvenience for the end users to make purchases. The methodology and findings are
included in this report along with the discussion of the findings. The limitations of the research
are also included in this report ending with the conclusion of the report (El-Darwiche, et al.,
2011).
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Research Background
The research background exemplifies that how the advancement in the technologies and uses of
the internet have increased the ways in which the industries like Chanel Australia, creates and
manages their business for the customers to purchase products and services. The Chanel
Australia manages an online store, and has multiple stores for improving the experience of the
online shoppers. The company has not only maintained a better relationship with their customers
with retention and loyalty, but has also improved the retail experience, which consequently
improves the satisfaction of the customers.
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Research Aim
The aim of writing this research report is to identify the impact of retail digitization on increasing
the customer point of contact and improve the retail experience at Chanel, Australia.
Research Questions
This part of the report is evaluated by designing objective to answer the research questions
differentiated in terms of primary and secondary. The primary question of this research report is:
 What is the effect of retail digitization on enhancing the customer point of contact and
ameliorate the retail experience at Chanel, Australia?
The secondary questions which this research report is intended to answer are:
 How to ameliorate the retail experience for the customers and what strategies were
undertaken by Chanel Australia?
 What could be the anticipated impacts created through digitization of the retail luxury
brand on improving the online shopping experience and the management of customer
contacts? And,
 What are the different measures recommended to ameliorate the luxury retail experience
and provide an ease to the end users to make purchases of the luxury brand services and
products from Chanel, Australia?
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Literature review
The new digital platforms are emerging with the technological advancements which accelerate
the business without losing the competitive advantage in the retail business. The increased
competition needs to engage partners, employees, and suppliers digitally in addition to
customers, although the threat of the commoditization which is a big challenge for the business.
The digital engagement means to the business and is important to understand as it is the initial
point with a structured approach to assessing the majority of the digitization based on the
comprehension and not just the technology. To mitigate this impact, the business needs to
develop an end to end response and must think about their operations and business models to
deliver the strategy. This strategy must be critical to the differentiation and innovation through
the operating model and C-level leadership. The retail digitization creates a good experience for
the customers and would even engage the experiences with customers across channels to remain
connected with the luxury brand. The details on the how the retail digitization impact and the
measures and recommends for the retail industry are as follows:
Identification of the effect of retail digitization on enhancing the customer point of contact
and ameliorate the retail experience at Chanel, Australia
There is an effect of retail digitization on enhancing the customer point of contact and ameliorate
the retail experience at Chanel, Australia. The leading organization or industries like Chanel
Australia are not necessarily waiting for the complaint to the customer support, but using product
processes to respond and reach out the customer's concerns via social media. The Chanel
Australia is implementing the practical strategies for boosting the revenue and delivering
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customer experience through the digitization (Slaats, 2013). The Chanel Australia redefines the
processes of support for problem management and has already implemented the strategies to
reach the customer support. It has been found in the study that 70% of the complaints of the
customers on the social media are the negative reviews reported on the website being generally
contacted by the retailer. The Chanel Australia is following the descriptive and predictive
analysis of the support and service process. They have changed the processes to analyze and
capture data and have a closed loop mechanism in place through the digitization. The Chanel
Australia has also created the multiple channels of deceptively difficult technologies and
processes which are challenging to the retail industries. The seamless experience helps in
delivering the information that the company values and increase their customers to engage with
them. The Chanel Australia has also integrated the digitization to establish a customer data
model. This helps in developing a unified system for customer interactions. The company has
implemented the unified customer interaction which is very prominent in support activities. It
has been leveraging existing customer relationship management systems through cloud based
multi-channel system (Wenig, 2014). The Chanel Australia has also developed the support
experiences and personalized product which brings a key area of focus for the customers. The
online retailing like industry like Chanel Australia have already taken the lead in defoliating
support with sales and by rethinking support staff and altering the phase processes. That is, the
company provides the offer of advice through the real-time service customer system. These
personalized products leverage digitization to drive personalization in support processes. The
Chanel Australia also uses the operational metrics which are important for retailing industries,
which also assist in one to one communication. The support system provides the feedback on the
services, products, and processes, and converting the customer support into real time
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communication. The Matrix that defines the channel Australia to deliver, creates, and reward
customers with personal knowledge and engagement. The Chanel Australia is taking advantage
of digital technologies and has a great impact on the customer support by implementing the
approaches as front office function (HM Government, 2007).
Evaluation of how to ameliorate the retail experience for the customers and what strategies
were undertaken by Chanel, Australia
The Chanel Australia has implemented the strategic structured approach to the business in order
to connect with their customers by understanding the opportunities and threats that are present in
the digital world. The most useful approach used by the Chanel Australia is the Digital maturity
assessment which helps the leadership teams of Chanel, Australia to comprehend the challenges
raised to the business and analyze the innovative and new ways to engage with their customers.
The digital maturity assessment is assessed by the Chanel Australia through five major
dimensions known as investors, suppliers and partners, leadership, employees, and customers.
Although an approach of digital maturity assessment is not just a solution, it is the initial stage on
a journey of transformation (Phibbs, 2017). The Chanel Australia understands that it is very
prominent to avoid the complexity of the digitization and they need to implement digitization
with the primary aim of what actually the digitization means to the Chanel Australia. With that
comprehension, it is possible for the Chanel Australia to develop various possibilities with an
action plan that makes sure that there are a longevity and success in the digital world (Ernst &
Young LLP, 2011).
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The assessment approach used by the Chanel Australia is shown in the image below:
(Wood, 2016)
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Assessment of the anticipated impacts created through digitizing the retail sector
There are numerous anticipated impacts created by digitizing the real sector. The devices and the
proliferation of digital channels provide the customers with greater access to the data and
information and the means for collaboration and communication. To the digital businesses and
assets, now the physical world are being duplicated in the digital world by fundamentally
changing the methods the customers engage with retail business and with each other. The price
comparison and the information aggregation have evolved in the digitization (Cognizant, 2015).
The customers now have access to the mobile and can have real time data that they used to
previously rely on different retailing brands to provide them. The customers of today’s
generation have real time access through their mobile phones and applications such as Red laser
to read the information by scanning a product barcode. That is, they can have competitive pricing
information (Wiefel, Digitalization: The impact on traditional retail and the future model of
multichannel, 2015). The comparison of the prices of the product provides the customers with a
transparency in the price by increasing the chances of placing power in the consumer’s hand. The
customers also used to depend on the brand values and the brand communication which help
them to make the informed choices for pricing information but this is not just persistently the
case. The customers of this century have more trust in the people or each other rather than
trusting on brand or industries. It has been revealed that 77% of the customers trust the
recommendations of their peers and approximately 15% trust advertisements. Customers take
advice from each other and depend on the advice of their peers. The conversations through the
feedback and comments provide the customer with a potential around what's happening with the
brand to control the brand message and to increase the engagement. The brands or retailing
industry also has an opportunity for the rise of the ‘presumers’. These ‘presumers’ are mostly
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used as a source of important development of the product ideas and provide an initiative of social
media that invite the users to provide or generate innovative ideas (Bacon-Gaillard, 2016). Thus,
the digitization is gaining more power to how to interact and choose where to interact and having
an impact on the retail industry to maintain the primary relationship. This helps in engaging and
reflecting with their values and retaining the customer relationship. The digital world has
nowadays thrown the base retail as well as other organizations into a strictly competitive game
(Wiefel, Digitalization: The impact on traditional retails and the future model of multichannel,
2015).
Recommendation on different measures to ameliorate the luxury retail experience and
providing an ease to the end users to make purchases of the luxury brand services and
products from Chanel, Australia
To stay competitive the Chanel Australia needs to transform into a fully digital business. The
Chanel Australia needs to think differently about the operations of the digital business and must
be an unreasonable aspiration. That is, the ‘unreasonable aspiration’ helps in seeing the
digitization as a business that will help in creating a value and will not act as just the channel that
relies on the exercises or practices. The company also needs the skills and acquires the
capabilities for Digital transformation and must have the collective ability of existing employees
(Chaudhuri, 2015). The Chanel Australia needs to comprehend that putting more focus on the
skills over experience is important to success in the early stages of transformation. To ensure the
rapid improvements comprehended by the Chanel Australia that ‘ring fencing’ the digital talent
are important in the dynamic digital environment, it is also critical to build rapid decision
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making. The Chanel Australia needs to continuously deliver and improve the methods such as
‘life beta’ and ‘agile development’, which are supported by the Big Data Analytics to improve
the innovation (Brandirali & Nieddu, 2015). It requires continuous experimentation along with
quickly responding to the parts of information. The digitization is about creating value for the
customers by reducing the cost and thus is more than just finding the streams of revenue. Also,
implementing the digitization in the channel Australia must be through critical testing as the
investments should not be spread haphazardly to include the customer experience. The rising
customer expectations are also increasing towards the business. That is, they expect the same
experience in the retail store as well as when they are doing the shopping online. It has also been
predicted by the survey that 90% of the consumers goes to the other competitors due to the poor
customer experience. Also for better customer experience, the users are also ready to pay higher
and this account for 85%. To find the experience of the customers using the digitization, it is
prominent for the Chanel Australia to test assumptions (Rosen, 2017).
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