In the 21st epoch, it will not be a newfangled conception to consider that technology is advancing rapidly. But Yes. It can be considered new when it comes to the revolution of the retail industry at the global level. With time, numerous newest technology push and market pull factors are emerging which is encouraging digitalization of brick and mortar stores. The revolution of the retail industry has now begun.
First of all, let us discuss what is digital transformation in the retail industry means?
It is an improved way for the retail industry to serve maximum customers with a better end product. With the advancement in technology, customers are getting more used to it. User journeys have been changed from the past 6 to 7 years till now. People are more likely to search online instead of reaching brick and mortar stores to buy the product of their choice. This is because they have more choices and ease of access to a wide range of products. The digitalization of the retail industry had made it possible for merchants as well as their customers to do hassle-free shopping.
Ecommerce and retail stores are making use of new digital technologies for better customer satisfaction and eventually a lift in sales. These technologies include AI, AR, VR, Digital Marketing, Analytics, Blockchain Technology, cloud services etc. The future of retail business depends upon these technologies in many ways. Nowadays, many retail businesses considered digitalizing their retail industry due to the COVID-19 scenario. This has become another push factor for the transformation of the retail industry.
Have a look below at the top 10 technology push factors that are encouraging the digitalization of the retail industry.
Mobile applications and smartphones
Smartphones have become a necessity of life in this era. People like a single click to get things done. The reason behind this is the globalization of technology. For customer satisfaction and better user experience, new technologies are being implemented on smartphones on priority for use in the retail industry.
Blockchain Technology has made payment processing and inventory management easier and efficient than ever. Users can keep track of inventory records making the system more reliable.
Blockchain Technology benefits the retail industry in terms of transparency in the supply chain, fraud prevention, reduction in product recall cost, improvement in the shipping process, safe international payments, digital and in-store integrations etc.
In short, Blockchain Technology is now serving as another very huge technology push factor to digitalize the retail industry.
Role of AR and VR
The first e-commerce industry giant that started using AR technology was Ikea. They provided the app with the feature of checking furniture by placing it in your home anywhere you want. To do that you just need to move your smartphone camera to that place after opening the app and can see furniture placed on the required area on the smartphone screen.
This feature not only increased customer experience but brought a drastic change in sales lift.
Macy’s a well know e-commerce brand tried implementing VR technology in its retail store. Through VR customers can check where the furniture will look good in a room setting. VR technology in the retail industry is still in process and soon will be adopted by numerous brands to best customer experience.
Use of AI for fetching target customer
Artificial Intelligence (AI) has impacted the way businesses interact with their customers. Implementation of AI in the retail industry has exposed great results in customer satisfaction and reduction in sale returns fraction. AI learn from pre-collective data and allows the complex process to be automated. Faster processing of data allows better customer experience is more efficient.
Major challenges which the retail industries used to face includes finding their target market, its location and devices they are using. AI has made it possible through different portals like Google Adwords, Analytics etc. AI records user behaviour and shows results to companies based on their search behaviour. This digital technology in retail businesses makes them able to invest in the right place.
Cloud computing has proved to be highly beneficial for the retail industry connecting the retail businesses with online resources for data protection. Reducing the cost of separate equipment and manpower provides quick access to resources throughout the Internet. With a global approach, retail businesses can now cut their business cost for purchasing equipment and focus more on sales growth and business strategies. Efficient performance and secure operations is an adequate need for e-commerce businesses. This reason has made cloud computing one of the technology push factors for the digitalization of the retail industry.
Internet of Things (IoT)
One of the most rapidly growing technology is the Internet of Things or IoT. This technology has brought in the concept of smart homes and stores. In the early ages, only mobile devices, computers and servers and other IT equipment were able to connect to the internet only. Now things have been changed.
The concept of IoT has made it possible for domestic appliances, sensors, alarms etc. to connect with mobile phone through the Internet. Now you can operate all these through your mobile phone in presence of an Internet connection. According to the study, 80 billion devices will be connected via the Internet for efficient operations by the year 2025.
Retail businesses are making use of RFID tags to increase the efficiency of their supply chain. Retailers get all the data through RFID, beacons and sensors for analysis and make smarter decisions. The future of retail businesses is now highly dependent upon this fast-growing technology.
Voice assisted shopping
Voice assisted shopping is another technology that is pushing the retail industry towards digital transformation. With the help of the voice search feature, customers can add their favourite product to a cart or wishlist by just using the voice feature of their smartphone. They can even make secure transactions online through their voice only. Customers can easily search for the required product through their voice. The feature helps save time in typing and searching. The Voice search feature is effective but not as much as IoT or AI.
Brick and Mortar stores are becoming even smarter. Retail industries are now implementing automated technologies like beacons, sensors to track the customers who stepped in and out of the shop. Just to improve the overall customer experience, brick and mortar stores are making use of tablets through which a customer can try on their favourite product right away without any hassle. This reduces time consumption and brings in a better customer experience to the retail industry.
IoT is playing a huge role in digitalizing the retail store for a better user journey. Once you enter the shop your smartphone will ping you the discounts on specific products. It will provide the store map and will guide through the aisles to track that product down and purchase right away.
Digital payment processing
Whether it is national or international level, customers nowadays prefer digital payments instead of traditional cash handover. Keeping cash is not safe and easy to manage. However, digital payment has made life easier as compared to old ones.
The use of VISA card, Debit card, Master card or Credit card has become more common in the past few years. To cater for this increasing demand of customers, retail industries are digitalizing the process by implementing POS system with digital devices.
According to Statista, E-banking volume has been increased approximately from 240 million (the year 2020) to 300 million (the year 2021) in Pakistan.
Robots are our future? Yes! Absolutely. Walmart has implemented robotic technology in their retail store. Robots scan the wracks and provide information on whether a stock is needed to be reloaded or not.
Another very interesting examples of digital transformation in the retail industry are the robot Flippy in Levy Restaurants. It is being used to flip burgers and make French fries automatically. Robots are of great benefit for the retail industry as retailers can leave routine tasks to robots and can focus on more complex ones and make strategies accordingly.
Apart from the technology, many marketing push factors are also being noticed that is encouraging digital transformation in the retail market. These dynamics include improved service anticipation of customers while shopping. They need clarification on things and due to time lack, they prefer a faster and easier shopping process. Keeping digital money is another huge factor that has enforced brick and mortar stores to digitalize their systems as soon as possible.
D-commerce is another aspect that retail industries are adopting. The concept of D-commerce is to improve the customer journey through various tactics after building an e-commerce store. It is obvious to say that once a company takes the initiative of bringing itself into the digital world, it would require more sales to keep it going on as implementation of few new technologies like robotics and AR is expensive for small businesses.