Digital transformation has revamped the existence of every industry unimaginably. Technological disruption has intensified completion, changed business models and eliminated geographical barriers. The retail industry has witnessed unprecedented changes due to technology evolution.
The rapid rise of e-commerce giants such as Amazon and Alibaba and the paradigm shift in consumer preferences have compelled traditional retailers to rethink their strategies and explore new forms of consumer engagement. The revolution took off with the advent of the iPhone app development and smartphones.
Retailers are now using immersive experiences, often blurring boundaries between online and offline worlds. The stakes are high, and it is all about convenience, personalization and flexibility. There is no denying that the mandate is clear to either change or be left out in the highly competitive world.
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A major transition for established brick-and-mortar retailers is eminent. The evolution has resulted in digital transformation from warehouse, inventory, and logistics to supply chain management at every business level. Retail software solutions are available for each and every function.
Retail Apocalypse: Is it real?
This year alone, major global retailers such as Bon-Ton department stores and Toys R Us permanently closed, while J.C. Penney, Sears and Macy are announced major store closures. The growing eCommerce industry is making it challenging for brick-and-mortar stores to stay relevant
Store closures and job losses in retail continue to dominate the news. Several reasons have contributed to the closure of retail stores such as rising costs, technological disruption and changing consumer behaviour. The UK high street also continues to undergo a considerable structural change.
There are numerous examples of innovation happening within the store and retailers are now investing in customer experience to provide a better, omnichannel customer experience.
The retail industry is dynamically changing to emerging technologies and trends. The key to surviving in this industry is to adapt to changing customer preferences and demands with the help of Retail IT Solutions and new technology in the retail industry
The Major Stats and Numbers of Retail Industry
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UK Retail Industry Challenges
- Consumer Spending
- UK High Street
- Online Shopping
Retail Technologies that will Define Future for The Industry
From facial recognition to biometric checkout, smart sensors tracking customer movements in the store—technology is redefining retail software solutions and how retailers function with optimum efficiency.
1. Rise of Mobile Applications
The usage of smartphones is increasing rapidly, which leads mobile applications into the trend. Due to the high adoption of mobility solutions, retail-based apps have taken over the industry. It helps retailers increase reach, build loyalty, and improve efficiency by providing multiple purchasing options and hassle-free services.
The primary reason that attracts retailers towards mobile application development service is that it allows to run businesses 24*7. Apart from this, retailers can also save infrastructure costs and offer the next generation shopping experience to their customers.
2. Social Shopping
With social media platforms, it is easier to target the right and wider audience. Social networking sites help spread product information more effectively by encouraging users to like, share, and discuss in the comment section. It is considered a powerful and effective marketing strategy for E-commerce as social media platforms can engage users.
3. Extended Reality
Extended Reality comprises enhanced digital and physical experiences combining augmented reality (AR), virtual reality (VR), and mixed reality (MR). It will greatly change shopping preferences and change the interaction between the company and its brands.
Benefits of Extended Reality
- Reduce costs
- Increase revenue and productivity
- Improve customer experience
How it works
Extended reality provides customers with the option to navigate through different products and virtually try products using a mobile application. It also gives customers the option to share their experience with other users.
Extended reality is especially gaining traction in the new normal, avoiding touchpoints during shopping due to COVID-19 social distancing restrictions. It limits the need for touching items that the customer might not end up buying.
4. Recommendation Engines
Recommendation engines have become a popular solution for online retailers looking to suggest products to users. These tools filter out information of lesser relevance to predict the likeliness of a user purchasing an item and suggesting those products or services to the user. This technology can play a vital role in building an omnichannel experience for the user right from researching a product online to purchasing in store. Recommendation engines work better based on the availability of data.
- Higher cart sales and improved customer satisfaction thanks to recommendation automation.
- Providing highly contextual user experience.
- Drive high conversion rate by giving personalized product recommendations.
5. Order Fulfilment Automation
Order fulfilment automation integrated with your existing systems can forecast future inventory needs, as well as enhance inventory replenishment best practices. These innovative retail technologies are ideal for small and mid-sized distributors, suppliers, and online retailers. It centralizes and automates fulfilment operations, especially with orders converging from different sales channels. Order fulfilment solutions process orders, reducing processing time.
Benefits of Order Fulfillment
- Real-time inventory control
- Advanced purchasing based on trends
- Warehouse management
- Easily track an unlimited number of products
- Prioritize orders based on the customer needs, inventory needed, and seasonal peaks
- Reduced fulfilment times resulting in unexpected cost savings
6. Facial Recognition
Facial recognition is fast becoming an integral part of the retail industry. This path-breaking technology is helping retailers overcome the problem of shrinkage, as well as personalize online shopping experience back to the brick-and-mortar stores. Retailers can use facial recognition to analyze the behavioural patterns of customers while shopping at their retail stores. It allows them to understand what customers feel and how they behave and act while in their stores.
- Improving customer experience by providing a real-time customer experience
- Combat returns fraud based on its mode of operation
- Understand your customers better
- Integrate with other loyalty software, CRM and cash register for increased sales
- Know your customers better and purchasing behaviour, as well as patterns
7. Inventory Management
Inventory management solutions are improving inventory control and real-time tracking of stock, giving the retailer a holistic view of product availability in-store.
Benefits of Inventory Management
- Effective management of stock-flow and predictions
- Improve forecasting to improve the retailer’s bottom line
- Integrate sales and inventory data to decide reordering and promotion strategy
- Review data and place orders to avoid stock outages
- Prioritize purchases based on an item’s profitability and popularity
- Determine dead stock such as damaged items, incorrect deliveries and unusable seasonal items.
8. Internet of Things
With over billions of connected products like home speakers, TVs, entertainment systems and cars to the Internet, retailers can collect voluminous data and actionable insights about customers’ product usage and preferences. This will allow targeted marketing to customers throughout every phase of the buyer journey. “Connected devices will be 3x the global population by 2023″ By- Cisco
It’s clear that The Internet of Things makes shopping faster, cheaper, and hassle-free.
9. Artificial Intelligence
Artificial intelligence is all set to change the outlook of the retail industry completely. The most likely technology to reshape the retail landscape is artificial intelligence (AI), driven by data from customers themselves. Analysis of “heat maps” provides details of customers’ movements in a particular section and which items they look. This information can be captured by LIDAR sensors. Similarly, virtual assistants and robots inside the store help make a recommendation to customers that add value to the customers.
AI like Siri, Cortana and Alexa are completely revamping consumers’ daily shopping experience. From manufacturing, distribution to delivery, AI will play a crucial role in the retail world.
Artificial intelligence is all poised to change the way payment is done. Chatbots deployed by payment companies are now providing an innovative way to check balances and make payments.
10. Augmented Reality
Augmented Reality is also a potent tool that stores are increasingly using. Augmented reality (AR) is expected to get even more sophisticated in 2021 with Apple and Google moving AR into the iOS and Android operating system. The adoption and implementation of AR technology will undoubtedly witness an increase. As AR technology matures, more retailers will explore ways to use it. For instance, retailers have produced demos of AR in the changing room to great effect. One of the most successful case studies of AR app development is IKEA. The app used Apple’s ARKit to preview how different IKEA products would look in the actual environment. It was simple, just scan the floor using the iPhone and select the product that needed to be placed.
11. Big Data Analytics
Big data analytics continues to mature. It is helping in strategic decision making. Progressive retailers are exploring new ways to leverage big data analytics to enhance different business aspects from sales, marketing, and customer service to retail operations. Retailers have adequate tools and data sources. It is just a matter of using big data tools and technologies in the best possible manner. Big data analytics can help retailers forecast demand, customize shopper experience and streamline the supply chain.
When used effectively, big data services and technologies can create a 360-degree view of customer experience across digital and in-store channels. Big data will only work if you are willing to make drastic and significant changes to your business.
As retailers struggle to do more with less in a margin-squeezed environment, the potential for Blockchain to reduce operating costs is one of its principal attractions. Blockchain can reinvent essential business functions, bringing trust and security in retail functions spanning across supply chain management, accounting and audit, and related account management processes.
Related Post: Emerging Technology used in the Retail Industry
Payment Trends in New Retail Technology to Watch Out
- Wallet Apps
Smartphone “wallet” apps will emerge as a new way to pay– a trend that’s being driven by “lifestyle” apps such as Alipay and WeChat.
- Biometric payments
Biometric payments (fingerprint or iris scans) will be used to authenticate payments, replacing cash shortly. A report predicts a trillion biometric payments will be made annually by 2022.
- Voice-Activated Assistants
Voice-activated payments driven by digital assistants such as Amazon’s Alexa will become more commonplace, with finance companies already pursuing the technology.
Cryptocurrencies and Blockchain might not replace conventional payment systems any time soon, but several banks are exploring Blockchain’s ability to authenticate transactions.
Successful retailers are continuously creating unparalleled, immersive customer-centric experiences in-store, enabling brick and mortar to compete with the convenience and variety of online shopping. Winning means taking the strengths of each and creating the best of both worlds.