Online sales are growing exponentially and yet physical stores continue to be an important asset for retailers. As customer expectations evolve, retailers are seeking to transform in-store experiences to differentiate their offerings and gain a competitive advantage. Falabella, a leading Latin American retail conglomerate, recognized store modernization was fundamental to maintaining its leadership position in the Latin American market.
Founded in 1889, Falabella has 560+ stores across seven countries, selling products across a wide range of verticals including grocery, fashion, home, DIY, construction solutions, travel and consumer credit.
As a tech-forward retailer, Falabella had a strong digital foundation but wanted to scale and accelerate growth with an advanced, futuristic tech modernization strategy. Falabella approached Thoughtworks to help bring to life the tech-powered future it had imagined for itself.
Building the blueprint for success
Thoughtworks began with a 3-month discovery to understand Falabella’s current technology and business landscape and developed an eCommerce product blueprint that has since evolved into the conglomerate's digital retail backbone; a transformational platform that accelerates the delivery of new business capabilities.
Store modernization and digital checkout
The platform powered Falabella’s store modernization and transformed the checkout experience, including touchpoints such as handheld devices, self-checkout, mobile point-of-sale (POS), scan-and-go, etc. A custom POS solution was built to interface with the store and provide a unified experience.
The modernization program ensures:
Technology transformation with a cloud-native, multi-tenant, API-driven, scalable and extensible platform built using domain-driven design principles. The Falabella ecosystem, hosted on Google Cloud, is a headless microservices-driven platform completely built on Kubernetes (event-driven architecture).
Platformization of business capabilities that extends core tenets of the Digital Retail Backbone (DRB) to support multiple channels, segments and countries. It reuses the core DRB capabilities such as pricing, carts, payments, promotions etc., that are common across business units, channels and countries – thus providing a SaaS-like platform to departments within Falabella. It also provides flexible API and configurations to customize core behaviors for country or channel specific requirements.
Flexibility and control through a hardware-agnostic solution that allows the platform to cater to the varying needs of the Falabella brand across locations.
De-risking deployment with canary releases to a small group of users before rolling out new features to the entire population.
Streamlined deployments and rollout into the new digital POS tills and store checkout platform.
Real-time alerting to ensure near uninterrupted store operations.
Time to Market for new features has also been drastically reduced with modern architecture and a state of the art platform.
Additionally, Thoughtworks’ client engagement methods ensured all stakeholders were adequately trained with access to standard operating procedures, runbooks, playbooks, etc., that would help align them to new ways of working. The business transformation accelerated time-to-market, enabling Falabella to launch features six times faster, bringing innovation to reality.
Falabella’s tech-driven in-store experience
The digital checkout solution enabled faster, one-touch self-checkout for customers and offered benefits linked to Falabella’s own digital wallet; FPay wallet, such as loyalty rewards, discounts, etc. The seamless in-store experiences helped with better FPay adoption among store customers.
The solution also reduced high cashier interventions observed in legacy self checkout to just 14%. This improved operational efficiency with an average transaction time of under 2 minutes for 4 items and increased employee satisfaction. The mobile POS (mPOS) serves as a queue buster, enabling staff to intervene and instantly fix broken customer journeys in the store.
To power Falabella’s omnichannel strategy, the platform allowed for swift scaling up – built features are instantly available to all business units and are expected to significantly reduce total cost of ownership once fully scaled. Also, the cloud-based disaster recovery strategy enables high availability.
Where does the omnichannel experience go from here?
The strategic business priority for Falabella is creating an ecosystem with offerings across retail, payments, loans, insurance and logistics. This benefits not only the customers but also the buyers and sellers who can leverage the marketplace.
Built on a solid foundation of a platform approach, Falabella and Thoughtworks believe store modernization is only the first step to powering the tech-forward retailer's vision. The next step is to create further differentiated experiences, including frictionless checkout with scan and go, gamified shopping, assisted selling, personalization at the POS, etc. As the digital wallet; FPay’s adoption grows, fraud checks and other financial services-driven solutions will also become necessary.
Over the long term, Falabella and Thoughtworks envision all digital and physical experiences will be seamless and the platform will power the store, eCommerce engine, a logistics and fulfillment platform and new opportunities to monetize the platform itself; driving new revenue streams and opening Falabella up to never-before-seen possibilities.
