Leveraging SD-WAN to enhance the omnichannel retail experience

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By Nick Maynard, Lead Analyst, Juniper Research and John Tait, Global Managing Director, TNS Payments. 

There is no doubt that retailers are currently facing one of the most challenging operating environments in the industry’s history. How retailers react to these challenges – and what priorities they set for their digital transformation – will be the difference between success and failure. This is especially true for brick-and-mortars who find it difficult to compete with the lower cost base of their ecommerce-savvy competitors that have thrived in the new environment.

Among retailers who traditionally rely on in-person sales rather than online, those that embrace digital transformation can find a saving grace in new omnichannel solutions. By breaking down the walls between their in-store and online operations with hybrid models, retailers can offer a superior customer experience. This could mean offering new customer touchpoints such as curb side pickup, click-and-collect and new delivery options that have boomed during the pandemic.

Retailers have been moving towards omnichannel commerce for some time, but there is still much work to be done in designing the ultimate user experience to help them reach and retain customers. Retailers face numerous challenges in adapting the way they operate. For example, flexibility is a difficult requirement for retailers. They need to have a technological infrastructure that enables them to be agile in terms of what services they offer, and how they can enable additional payment methods, such as digital buy now pay later. Systems need to support the additional tools that can make the omnichannel model a success, including data analytics, value-added services and digital loyalty programmes.

So how do retailers maximise their potential for growth in the wake of the difficulties they have faced? Fundamentally, retailers need to have a clear emphasis on the user experience and how they intend to deliver it and improve upon it. Retailers must identify what tools they need in place to offer the best experience now, or they will struggle to recover. Ultimately, the most digitally agile retailers will be the best positioned to flourish in this new retail paradigm.

Enabling Flexibility with SD-WAN

Among the plethora of available solutions, a software-defined network (SD-WAN) has emerged as a game changer for retailers in need of a digital customer experience upgrade. SD-WAN functions as a software-defined layer that can harmonise how different connectivity systems work, making operations simpler to manage, more cost-effective and more flexible.

Figure 1: SD-WAN Concept in Payments

Source: Juniper Research

In this volatile climate retailers need flexibility, and that is one of the key features SD-WAN provides. As a software layer, SD-WAN can be configured for unique setups for individual stores and retailers and can be reconfigured as circumstances change and store portfolios or other elements of the technology stack evolve.

SD-WAN and the Cloud

As a software layer, SD-WAN is also suitable for the cloud ecosystem. SD-WAN successfully navigates modern requirements such as API connectivity, which critically enables value-added services like analytics, as well as alternative payment models. API connectivity is critical in enabling consistent consumer experiences across ecommerce and physical channels, which is fundamental to omnichannel commerce.

Leveraging Managed Network Solution Providers (MNSPs)

By leveraging an SD-WAN MNSP, retailers can free resources to work on challenges associated with managing their business through a global pandemic. SD-WAN allows retailers to reduce their total cost of ownership by using a more flexible, software-defined solution, increasing retailer capabilities while decreasing operating costs. Not only can SD-WAN deliver this direct cost reduction, but by reducing the overall complexity of ownership, retailers may be able to redeploy resources to challenges associated with their core business.

SD-WAN can also enable retailers to offer features such as customer Wi-Fi more easily, which supports the objective of converting a retail store into a destination. It is also actively monitored and managed all day, every day, to deliver the robust connectivity that retailers need to ensure a positive user experience and to minimize interruptions that might impact their ability to collect payments.

When paired with other solutions, SD-WAN can offer a secure environment that limits PCI scope and reduces merchants’ costs for achieving and maintaining compliance with PCI-DSS. This is because when they outsource to a MNSP, they also pass the responsibility for maintaining PCI-DSS compliance for that part of their infrastructure to the provider.

It is important to remember that SD-WAN is not the only solution for a retailer – it needs to be a part of an overall digital transformation strategy. SD-WAN is the technology that underpins this roadmap, but it should be deployed alongside other technological innovations to obtain the best result. Also, not all SD-WAN solutions are comparable. Retailers should choose the solution that matches their specific requirements. If they find the right match of capabilities against their requirements, then SD-WAN can be a key accelerator to digital transformation initiatives.

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