Retail Technology: 5 Key Trends for 2023

Retail technology encompasses innovation and digitalization in physical retail and e-commerce, from checkout to inventory management, order fulfillment, and in-store service. The use of retail technology plays an essential role in enhancing the consumer experience.

Online and in-person retail in India is progressing faster than ever. Technological advancement is leading that charge and so are shifting consumer expectations. As a result, the global retail digital transformation market was valued at $145 billion in 2020 and is expected to reach $390 billion by 2026, with an expected CAGR of 18.2 percent over the forecast period (2021–2026).

As digital citizens, we know that technology will continue to play a key role in our lives. But, as we enter 2023, we wonder what the next year will bring. So, here’s a look at five retail technology trends that can shape business outcomes in 2023:

Data will Continue to Remain Crucial

Within the physical bond in which the retail sector is immersed, obtaining, channeling, analyzing, and taking advantage of data that can be obtained 24/7 from shop traffic, returns, purchases, sales, etc., is a spectacular tool for optimizing strategies, processes, and services. It means learning deeper and much better about how customers consume. In-store distribution, seasonal campaigns, and sales strategies in physical commerce must leverage this key asset to sell more.

Hybrid Consumer Journeys

When we talk about offline shopping, understanding consumer journeys means learning about our audience and what they want as they walk into the store – just as an e-tailer would when users arrive at their website. In online retailing, it means developing methods of delivering the same experiential shopping experiences that people enjoy in a physical setup. This could be through innovative technology enabling personalization or virtual and augmented reality solutions.

Hybrid shopping combines the best of both worlds, online & offline, to create consumer journeys that tick all boxes. Online retailers must learn about building personal relationships with consumers and delivering immersive shopping experiences. In 2023 adopting this hybrid mindset can be a crucial strategy for retailers looking to continue to build brand awareness and consumer loyalty.

Enriching Payment Modes

In a market like India, the consumer's entire shopping experience is being continuously revamped by both retailers and online sellers. Many storefronts now offer “buy online pick-up in-store” (BOPIS) services, same-day delivery, and online shipping. With so many new ways to order goods, businesses must implement point-of-sale systems more intelligently. 

One critical component of bridging the gap between offline and online shopping experiences is through payments. Accepting various digital payment methods adds consistency and convenience to the user experience. For example, accepting QR code payments, buy-now-pay-later (BNPL), virtual payments like Google Pay, and even e-money can provide better accessibility for offline and online shoppers.

Transforming Consumer Experience with AR

Regardless of one's view about what the future of AR in the metaverse might look like, there's no denying that businesses plan to provide more immersive and digitally consistent experiences to consumers. A few paths toward delivering these immersive experiences involve indoor navigation, virtual try-on solutions, and other applications powered by AR. This is one of the vital technologies currently bridging the gap between digital e-commerce storefronts and brick-and-mortar shopping and is thus worth evaluating.

Sustainability & Environmental Care

Concern for the environment is behind much of the shopping experience of consumers today, who more than ever demand sustainable packaging, care for the environment, production models based on recyclable items, and reducing negative impact. As a result, retailers have a golden opportunity to distinguish themselves as a business, build value and engagement, and base long-term relationships with suppliers and consumers based on adopting sustainable practices.

Businesses leveraging new and innovative solutions tend to stand out among the rest and be more profitable. To leverage the potential of technology and provide consumers with exciting ways to browse, buy and save, both offline and online retailers are turning to technology in several innovative ways.