The increasing adoption of technologies like connected devices, augmented reality, and machine learning has changed the way we shop, and retailers are evolving how they do business to meet the needs of their customers.

Retailers say it’s no longer enough to keep pace with shoppers’ growing expectations—they must get ahead of them. That’s why more and more are turning to the cloud. They’re using it to eliminate data silos and take advantage of cloud-based analytics. They’re tapping into machine learning to improve all aspects of the value chain. And they’re making use of reliable and secure cloud infrastructure to scale their businesses.

Although every retail customer is different, many of them share similar objectives. Here are three major ways retailers take advantage of the cloud.

Storing and Analyzing Data in the Cloud

Data presents both a challenge and an opportunity for retailers. Which is why Ulta Beauty, the largest beauty retailer in the US, is moving to Google Cloud Platform (GCP). Now, with the help of BigQuery, Ulta Beauty will be able to more efficiently predict and analyze outcomes and develop more meaningful data insights that can be leveraged to deliver a more personalized, relevant guest journey.

They are not alone. DSW has also chosen to use GCP to help relaunch their DSW VIP loyalty program for the first time in over 10 years. With more than 90% of transactions running through their loyalty program, DSW needed a flexible and scalable solution to deliver a real-time loyalty program for 26 million active members. They’ve already seen a 9% uptick in new customers and have improved their already strong retention rate.

Improving Customer Experiences with AI and Machine Learning

Once retailers are able to access these insights, they are turning to AI to help personalize the overall shopping experience. At first, retail companies leveraged AI tools such as machine learning for product recommendations.

Now, more retailers use AI to forecast trends, predict inventory needs and prevent stock outs, and provide personalized recommendations to customers to intelligently and efficiently serve them.

Just look at METRO AG, one of the largest B2B wholesalers globally. They’re using AI and machine learning to better serve their customers. For example, many of their customers are restaurant owners. With Google Cloud AI capabilities, they can create tools that identify when a restaurant is out of a particular ingredient and automatically order more.

Ocado is another great example. The world’s largest online-only grocery retailer drove a 3.5% increase in contact center efficiency by using Google Cloud machine learning technology to respond to customer emails four times faster.

To help businesses further accelerate their AI solutions, Google has developed the Advanced Solutions Lab (ASL), which gives businesses the opportunity to work side-by-side with Google’s AI and ML experts to solve high impact challenges.

Fast Retailing, the Japanese retailer behind Uniqlo, is working with Google Cloud and ASL to help them better analyze customer data to forecast demand and deeply understand what their customers want.

Carrefour, one of the world’s leading retailers, also announced last year that its engineers will be working side-by-side with our AI experts to co-create new consumer experiences. This is in addition to deploying G Suite to their employees to support the company’s digital transformation.

Scaling Infrastructure to Meet Demand

Of course, none of this innovation is possible without a reliable infrastructure that can scale instantly to meet surges in traffic.

And many have found the reliability and security they need with the cloud. That’s why global cosmetics brand Lush chose Google Cloud. They migrated their e-commerce platform to GCP to handle increased traffic without compromising stability.

This move that ultimately reduced infrastructure hosting costs by 40 percent.

L.L.Bean also modernized its IT infrastructure by moving capabilities from its on-premises systems to GCP, improving customer satisfaction and IT efficiency across multiple sales channels.

It’s simply amazing to witness how some of our systems integrators employ Google Cloud solutions to drive innovation in ways we at Google may never have considered—especially in healthcare.  According to analyst firm MarketsandMarkets, the market for the Cloud in healthcare is projected to grow 43% between 2020 and 2025 to nearly $65 billion, fueled by the need for better technology infrastructures and faster digital transformation.  

Healthcare and life sciences communities are looking to Google Cloud and its Service engagement model partners to improve collaboration and activate the power of medical data.  These transformations deliver robust data analytics and bring a much deeper perspective into health epidemics like COVID-19 to help save lives.

In the healthcare and life sciences industry, our Google Cloud partners and customers provide constant energy and inspiration–and are the magic in some key healthcare innovations globally.  

Let me show you how they are solving real-world business challenges.

Improving collaboration in Healthcare

Cloudbakers and Comanche County Memorial Hospital transitioned 2,000 employees to Google Workspace to improve collaboration, reduce costs, and increase security. By implementing a system that requires less maintenance while enabling mobile access to data and true collaboration, Comanche County Memorial Hospital saves $175,000 annually on licenses and helps medical professionals spend more time with patients.

“We chose Google Workspace because it cost a quarter of what we were paying previously, offers the kind of modern features that healthcare facilities need, and gave us data security and peace of mind.” —James Wellman, CIO, Comanche County Memorial Hospital

Accessing previously locked down medical data

Google Cloud and Quantiphi supported advances in cloud-based machine learning services to reduce infrastructure costs, unlock new paths of treatment, and dramatically reduce the amount of time it takes to evaluate scanned imagery following a stroke.  John Hopkins University BIOS Division has been working on medical imaging to accelerate insights from scans on approximately 500 patients from 2,500 hours to 90 minutes, and lead to more accurate decision-making for brain injury patients that will ultimately improve medical outcomes.  

“We’ve aligned closely with the goal of showing that a cloud-based, AI-driven approach is robust and that it can be performed while protecting personal PHI. In terms of costs, the cloud has definitely reduced some of the traditional financial demands of our research.” —Daniel F. Hanley, Jr., M.D., Director, Johns Hopkins University BIOS Division

Improving data access with the flexibility of Google Cloud

With the help of MediaAgility, TRIARQ migrated to Google Cloud to modernize their platform, build new applications, and expand their global footprint.  With BigQuery, TRIARQ can now consolidate all transactional data, past and present, into a single location to report on specific insights and predict future data from e-prescriptions to complex revenue-cycle data and value-base analysis.

“The future of this industry will need to be a global one, and we can no longer be stuck in legacy systems if we want to survive. Having a team that is passionate about supporting us in this journey is definitely a plus point.”—Yaw Kwakye, Co-founder and Chief Architect, TRIARQ

Increasing visibility to COVID-19 outbreaks for actionable insights

As part of its response to the COVID-19 pandemic, HCA Healthcare chose to work with Google Cloud and SADA to create a national portal that increases visibility into outbreaks in 3,100 counties across the country in just 8 weeks.  Now, the portal generates 30,000 new analytical views each day that can help inform private and public sector decision making for reopenings, closures, hot spots, and many other population health management activities. 

“This project required deep knowledge of AI, and consumer-facing platforms, as well as healthcare. Google brought together the ideal combination of product, people, and partners. Google Cloud’s healthcare-specific products along with SADA’s expertise in the healthcare IT space made this partnership the perfect choice to move quickly and intelligently.”—Dr. Edmund Jackson, Chief Data Officer, HCA Healthcare

We’re committed to building the technology, resources, and services through Partner Advantage to help our partners address this opportunity.  Looking for a solution focused partner in your region who has achieved Expertise and/or Specialization in your industry?  Search our Global Partner Directory.  Not yet a Google Cloud partner? Visit Partner Advantage and learn how to become one today!

The Home Depot, Inc., is the world’s largest home improvement retailer with annual revenue of over $151B. Delighting our customers—whether do-it-yourselfers or professionals—by providing the home improvement products, services, and equipment rentals they need, when they need them, is key to our success.

We operate more than 2,300 stores throughout the United States, Canada, and Mexico. We also have a substantial online presence through HomeDepot.com, which is one of the largest e-commerce platforms in the world in terms of revenue. The site has experienced significant growth both in traffic and revenue since the onset of Covid-19.

Because many of our customers shop at both our brick-and-mortar stores and online, we’ve embarked on a multi-year strategy to offer a shopping experience that seamlessly bridges the physical and digital worlds. To maximize value for the increasing number of online shoppers, we’ve shifted our focus from event marketing to personalized marketing, as we found it to be far more effective in improving the customer experience throughout the sales journey. This led to changing our approach to marketing content, email communications, product recommendations, and the overall website experience.

Challenge: launching a modern marketing strategy using legacy IT

For personalized marketing to be successful, we had to improve our ability to recognize a customer at the point of transaction so we could—among other things—suspend irrelevant and unnecessary advertising. Most of us have experienced the annoyance of receiving ads for something we’ve already purchased, which can degrade our perception of the brand itself. While many online retailers can identify 100% of their customer transactions due to the rich information captured during checkout, most of our transactions flow through physical stores, making this a more difficult problem to solve.

Our old legacy IT system, which ran in an on-premises data center and leveraged Hadoop, also challenged us since maintaining both the hardware and software stack required significant resources. When that system was built, personalized marketing was not a priority, so it took several days to process customer transaction data and several weeks to roll out any system changes. Further, managing and maintaining the large Hadoop cluster base presented its own set of issues in terms of quality control and reliability, as did keeping up with open-source community updates for each data processing layer.

Adopting a hybrid approach

As we worked through the challenges of our legacy system, we started thinking about what we wanted our future system to look like. Like many companies, we began with a “build vs. buy” analysis. We looked at several products on the market and determined that while each of them had their strengths, none was able to offer the complete set of features we needed.

Our project team didn’t think it made sense to build a solution from scratch, nor did we have access to the third-party data we needed. After much consideration, we decided to adopt a solution that combined a complete rewrite of the legacy system with the support of a partner to help with the customer transaction matching process.

Building the foundation on Google Cloud

We chose Google Cloud’s data platform, specifically BigQuery, Dataflow, DataProc, Cloud Storage, and Cloud Composer. Google Cloud platform empowered us to break down data silos and unify each stage of the data lifecycle from ingestion, storage, and processing to analysis and insights. Google Cloud offered best-in-class integration with open-source standards and provided the portability and extensibility we needed to make our hybrid solution work well. The open standards of BigQuery’s BQ Storage API allowed us to leverage fast BQ storage layers to be utilized with other compute platforms, e.g., DataProc.

We used BigQuery combined with Dataflow to integrate our first- and third-party data into an enterprise data and analytics data lake architecture. The system then combined previously siloed data and used BigQuery ML to create complete customer profiles spanning the entire shopping experience, both in-store and online.

Understanding the customer journey with the help of Dataflow and BigQuery

The process of developing customer profiles involves aggregating a number of first- and third-party data sources to create a 360-degree view of the customer based on both their history and intent. It starts with creating a single historical customer profile through data aggregation, deduplication, and enrichment. We used several vendors to help with customer resolution and NCOA (Change of Address) updates, which allows the profile to be house-holded and transactions to be properly reconciled to both the individual and the household. This output is then matched to different customer signals to help create an understanding of where the customer is in their journey—and how we can help.

The initial implementation used Google Dataflow, Google’s streaming analytics solution, to load data from Google Cloud Storage into BigQuery and perform all necessary transformations. The Dataflow process was converted into BQML (BigQuery Machine Learning) since this significantly reduced costs and increased visibility into data jobs. We used Google Cloud Composer, a fully managed workflow orchestration service, to help orchestrate all data operations and DataProc and Google Kubernetes Engine to enable special case data integration so we could quickly pivot and test new campaigns. The architecture diagram below shows the overall structure of our solution.

Taking full advantage of cloud-native technology

In our initial migration to Google Cloud, we moved most of our legacy processes in their original form. However, we quickly learned that this approach didn’t take full advantage of the cloud-native and more improved features Google Cloud offered such as auto scaling of resources, flexibility to decouple storage from the compute layer, and a wide variety of options to choose the best tool for the job. We refactored our Hadoop-based data pipelines written in Java-based Map Reduce and our Pig Latin jobs to Dataflow and BigQuery jobs. This dramatically reduced processing time and made our data pipeline code concise and efficient.

Previously, our legacy system processes ran longer than intended, and data was not used efficiently. Optimizing our code to be cloud-native and leveraging all the capabilities of Google Cloud services resulted in reduced run times. We decreased our data processing window from 3 days to 24 hours, improved resource usage by dramatically reducing the amount of compute we used to possess this data, and built a more streamlined system. This in turn reduced cloud costs and provided better insight. For example, DataFlow offers powerful native features to monitor data pipelines, enabling us to be more agile.

Leveraging the flexibility and speed of the cloud to improve outcomes

Today, using a continuous integration/continuous delivery (CI/CD) approach, we can deploy multiple system changes each week to further improve our ability to recognize in-store transactions. Leveraging the combined capabilities of various Google Cloud systems—BigQuery, DataFlow, Cloud Composer, Dataproc, and Cloud Storage–we drastically increased our ability to recognize transactions and can now connect over 75% of all transactions to an existing household. Further, the flexible Google Cloud environment coupled with our cloud-native application makes our team more nimble and better able to respond to emerging problems or new opportunities.

Increased speed has led to better outcomes in our ability to match transactions across all sales channels to a customer and thereby improve their experience. Before moving to Google Cloud, it took 48 to 72 hours to match customers to their transactions, but now we can do it in less than 24 hours.

Making marketing more personal—and more efficient

The ability to quickly match customers to transactions has huge implications for our downstream marketing efforts in terms of both cost and effectiveness. By knowing what a customer has purchased, we can turn off ads for products they’ve already bought or offer ads for things that support what they’ve bought recently. This helps us use our marketing dollars much more efficiently and offer an improved customer experience.

Additionally, we can now apply the analytical models developed using BQML and Vertex AI to sort customers into audiences. This allows us to more quickly identify a customer’s current project, such as remodeling a kitchen or finishing a basement, and then personalize their journey by offering them information on products and services that matter most at a given point through our various marketing channels. This provides customers with a more relevant and customized shopping journey that mirrors their individual needs.

Protecting a customer’s privacy

With this ability to better understand our customers, we also have the responsibility to ensure we have good oversight and maintain their data privacy. Google’s cloud solutions provide us the security needed to help protect our customers’ data, while also being flexible enough to allow us to support state and federal regulations, like the California Customer Privacy Act. This way we can provide a customer the personalized experience they desire without having to fear how their data is being used.

With flexible Google Cloud technology in place, The Home Depot is well positioned to compete in an industry where customers have many choices. By putting our customers’ needs first, we can stay top of mind whenever the next project comes up.