Oz Supermarket: Retail Innovation, Customer Service, and Operations

This report presents a case study of Oz Supermarket, focusing on its implementation of PayWave technology to enhance customer convenience and streamline payment processes. The report explores the innovation in the retail space and investigates methods for improving customer service and business operations. The analysis covers the benefits of PayWave, such as reduced wait times, and examines potential improvements including implementing Google's Zero Moment of Truth (ZMOT), multi-channel sales including e-commerce and mobile applications, communication strategies, retail markdown optimization, and automated inventory management. The report provides recommendations for enhancing customer experience through a customer-oriented culture and by focusing on the total customer experience, as well as leveraging data analytics to optimize marketing and promotional strategies. The conclusion highlights the potential for increased profitability, customer loyalty, and operational efficiency through the adoption of these innovative strategies, positioning Oz Supermarket for long-term success.

Oz Supermarket Innovation
[Name]
[Email address]

Contents
Introduction................................................................................................................................1
Question 1..................................................................................................................................1
Business operation..................................................................................................................1
Recommendations..................................................................................................................2
Question 2..................................................................................................................................3
Improve customer service.......................................................................................................3
Improving business operations...............................................................................................4
Conclusions................................................................................................................................4
Bibliography...............................................................................................................................5
2

Introduction
This report is a case study of Oz Supermarket change which has implemented a new
technology that would be explored here to understand the potential of innovation in the retail
space. This report deals with two key questions with respect to retail stores that include
exploration of the innovation used in the retail space and of methods used for improving
customer service. The paper explores the case of Oz Super market that has applied
technology innovation to its retail store payment systems by installing a PayWave technology
that allows customers to make purchases on the go without the need to stand in queues
waiting to complete transactions. The store sells household goods, non-perishable items and
stationary. With the implementation of PayWave technology, the shopping experience of
customers would improve as shopping will become fast and more convenient. The report
would also explore more potential ways that customer services can be improved in the store
besides this newly implemented technology.
Question 1
Business operation
Oz Supermarket is a retail store that sells household, stationery and non-perishable goods in
the store. Recently, the retailer has implemented an innovative payment and delivery system
to reduce the inconvenience of customers that is caused by waiting in long queues for making
payments. Customers of today have less time and thus, they always look for services that are
fast and waiting in queues of payment is seen as a major cause of inconvenience for such a
customer. The new technology has solved this problem by deploying a PayWave technology
in which the customers can make automatic payments that get calculated as they add the
items in the cart while shopping and while leaving the shop, they just need to wave the card
to make the payments which gets deducted from the card balance.
PayWave technology utilizes a contactless payment system that comes with a card which has
money balance filled using which the purchases can be made from the store. The cart is
connected with this prepaid card such that with every item addition, the corresponding bill
gets generated and charged to the connected card. Each cart uses a RFID reader which
records the details of the items added and updates the same in the membership card. In case,
3

the customer is new and does not have any membership card, a cash amount is taken by the
cashier against whom a new card is immediately issued using which shopping can be
continued by the store visitor. In the case, shopping items exceed the card limit; an alarm
rings to alert the customer and the store staff. Besides this technology, the retailer offers some
more services to its customers such as display of shopping summary of cart at stations and
timed car parking facilities allowing low cost parking in non-peak periods. A the shopping
cart itself adds to the bill and updates the same in the card, customers do not have to wait for
billing and payment which saves time as well as brings convenience to the customer
(Reinartz, Dellaert, Krafft, Kumar, & Varadarajan, 2011).
Recommendations
There are several retail store modes that exist in the world such as Amazon and Carrefour.
These models can be explored to understand what recent retail innovations have been used in
the industry such that their best practices are identified and can be used for making
recommendations for the improvement of the Oz Supermarket retail store. Thus, these models
were explored and certain recommendations were drawn from the lessons including:
 Google had launched a concept called Zero Moment of truth (ZMOT) that used the
conversations between the company and its customers while they went through the
process of purchase including sales talks, customer reviews, and direct customer
interactions, to explore customers. If the same technology can be adopted for the Oz
supermarket, it would help the retailer track buyer behavior in the journey of purchase
which can help the retailer understand the needs and preferences of customers such
that better marketing and other plans can be formulated to improve the customer
service (Nielsen , 2013).
 Instead of just the store, Oz can make use of multiple channels to reach out to their
customers such as ecommerce system that allows customers to make orders online or
do pre-orders for goods that can be picked from the store upon visit. As online selling
systems are increasing day by day with more and more customers adopting it, absence
of the facility would make the company lose on opportunities. An addition of the
online and home delivery purchase option would add convenience of shopping to
customer and increase sales for the retailer.
4

 Oz superstore can launch a mobile application which customers can use for tracking
their purchases or may be explore additional features like surfing lists, recipe
recommendations, a and so on. The application would serve as a guide to picking,
refining quantities, and scheduling deliveries. This would add to convenience for the
customer thereby enhancing customer satisfaction because of enhanced shopping
experience. An increase in satisfaction can result into increased number of customers
buying from Oz superstore.
Question 2
Improve customer service
The customer service at the Oz superstore can be improved by the retailer in several ways
that have been discovered upon studying various methods and strategies used by other
successful retailers in the world. These strategies include:
Communication strategy: Keeping a control over the operational costs is very challenging
in a retail organization as it needs employees of the company to be productive as well as the
processes to be efficient. Communication can help employees of the store and its managers
collaborate and work effectively. If a two-way radio system can be implemented allowing
continuous communication between them then it can help employees stay focused and solve
issues of slow requests and out of stock conditions. Moreover, customer complaints can also
responded to easily such that they can be tackled well.
Retail Markdown Optimization: Retailers have a lot of market pressure from competition
as in this industry, consumer preferences keep on changing as retailers respond to these
changing demands quickly to retain more customers with them. The objective of any retail
establishment is to makes sales in a way that maximizes its profits. In such a situation, a
strategy called Retail Markdown Optimization can be used such that retailer can take right
decisions on inventory and pricing while taking care of the business constraints. This
innovation in inventory management would enable company to take appropriate decisions on
manipulation of the prices and stocking of the goods as per seasonal requirements. This
would help retailer avoid problematic situations like too low pricing leading to margin
reduction and too high pricing discouraging customers from purchasing thereby reducing
demand and increasing left over stock. Oz Supermarket already forecasts its demand but it
does not consider the complete product life cycle which can be done with the retail mark
5

down optimization enabling retailer to judge the impacts of the decisions on the full product
life cycle such that full merchandize value can be realized (Marx & Erasmus, 2006).
There are some applications available in the market that can be used for retail markdown
optimization such as retail applications from oracle and SAS that are used for inventory
management, merchandize clearance, product life cycle pricing and study of impacts of
promotion (Oracle, 2015). Variations in the consumer demand can be incorporated as per
geography or demography such that most profitable markdown events can be created and
most profitable inventory locations can be identified. The optimization would thus improve
eth performance of the store by helping it achieve its financial targets by taking right pricing
decisions that help maximize the profits. Best deals can be formulated for extending benefits
to customers while at the same time ensuring that the retailer is also benefited appropriately
(Dydacomp, 2014).
Besides these technological developments suggested, there can be some more methods that
would help the retailer improve its customer service at the store and some of them are
recommended below:
Creation of customer oriented culture: a culture that is focused on the customer service can
be instilled in the organization by aligning the staff of the superstore towards this goal. For
this, first the staff would be selected on the basis of their tendency to serve customers and
then structures would be formed supporting customer support. Customer satisfaction may be
measured from time to time such that teams are both aware and focused on customer service
(Salmon, 2013).
Total Customer Experience: The store can provide certain add-on services for its customers
over its core and basic services which would give a wholesome experience to the customer
beginning from the entry in the store till the exit. Wave card is already a technology
implemented that would take care of the inconvenience caused to customers as they keep
standing in queues waiting to make final purchases. However, some more facilities such as
appropriate lightening, easy navigation, and soothing music can be added to enhance the
experience and thereby the customer satisfaction (CSSP, 2007).
Improving business operations
Business operations of the Supermarket store can also be improved using following methods:
6

 Data Analytics: The point sales data can be analyzed using data analytics systems
such that most appropriate mechanizing techniques and promotional strategies can be
formulated for different customers based on their segments. These segments could be
based on psychographics or demographics. The retailer may also store the in-store
experiences of consumers and use the same for analyses such that loyalty programs
can be designed or improved based on consumer preferences (IBM, 2010).
 Automated inventory management: The inventory at the store can be managed
using automatic processes that would enhance the efficiency as well as improve the
accuracy of the inventory management system. The activities that can be automated in
these processes can include tagging of products, printing, layout designing, price
management, and so on. This would help retailer streamline its operations beginning
from the activity of receiving stocks. Coding the products, tagging them, picking from
store, and packing, shipping in case of home deliveries, item tracking and inventory
replenishment when the stock is getting over. The resulting benefits would be reduced
errors, reduced resource requirements, increased sales, increased customer satisfaction
and increased productivity (Motorola Solutions, Inc., 2013).
Conclusions
The report explored the operations of a retail store called Oz Super market that has recently
installed a PayWave technology that allows customers to make payments through a prepaid
card on the go eliminating the need for them to wait at the billing counter for building and
payment. They would pick the items to put in the cart which would be linked with the card
such that the price for every item added gets deducted from the card balance automatically
and the final payment is received at the store at the time of exit when the customer waves the
card at a machine. There were some more technologies and other customer serve
enhancement strategies that were discussed in the paper such as automated inventory
management, markdown optimization, zero moment of truth, multichannel promotions,
ecommerce implementation, mobile application development, real time data analytics, real
time communication management, total customer experience management ,and so on. All
these strategies were found to be innovate and were used in other retail stores that got
benefited with improved efficiency of services, increased customer satisfaction, enhanced
decision making in terms of pricing, promotion, and inventory management, and so on. Thus,
the methods can be recommended for Oz supermarket such that the addition of these
7

technologies and implementation of the suggested strategies would being major operational
as well as strategic benefits for the organization which would be beneficial for the
organization into eh long run. Some benefits that can be expected with these implementations
include profitability enhancement, customer loyalty enhancement, reduction in errors,
increased customer satisfaction, improved customer experience, increased product life cycle
values, and so on.
8

References
CSSP. (2007). Customer Satisfaction: IMPROVING QUALITY AND ACCESS TO SERVICES
AND SUPPORTS IN VULNERABLE NEIGHBORHOODS. Center for Study of Social
Policy.
Dydacomp. (2014). Drive Your Retail Sales Growth With Operational Efficiencies eBook.
Dydacomp.
IBM. (2010). Increasing Sales, Improving Efficiency, Working Smarter in Retail. IBM.
Marx, N. J., & Erasmus, A. C. (2006). An evaluation of the customer service in supermarkets
in Pretoria East, Tshwane Metropolis, South Africa. Journal of Family Ecology and
Consumer Sciences, 55-67.
Motorola. (2009). Improve Customer Service with Instant Communication. Motorola.
Motorola Solutions, Inc. (2013). IMPROVE PRODUCTIVITY AND CUSTOMER SERVICE
IN THE RETAIL STORE WITH AUTOMATED INVENTORY MANAGEMENT.
Motorola Solutions, Inc.
Nielsen . (2013). Continuous Innovations: The Key to Retail Success. The Nielsen Company.
Oracle. (2015). Oracle Retail Markdown Optimization. Oracle.
Reinartz, W., Dellaert, B., Krafft, M., Kumar, V., & Varadarajan, R. (2011). Retailing
Innovations in a Globalizing Retail Market Environment. Journal of Retailing , S53–
S66.
Salmon, K. (2013). The Compelling, though Sometimes Elusive, Benefits of Markdown
Optimization. Kurt Salmon.
9