The advent of technology unarguably transformed the retail space and shaped consumer expectations in many ways. But the outbreak of the pandemic was responsible for a dramatic shift in consumer expectations, compelling retailers to integrate technology into multiple areas of retail operations where technology was yet to be utilized to its full potential. Though the retail market in India witnessed a slow down during the pandemic period, investors pumped in 260 percent additional capital into local firms that offer tech solutions for online and offline retailers in 2021.
The pandemic saw retailers digitizing their operations at a massive scale. India’s e-retail market stood at 4.6 percent by the end of FY21. India’s e-commerce market is projected to record sales worth US$ 55 billion during 2021 with the addition of 40 million new online shoppers. But an e-commerce platform or a digital presence is no longer enough to deliver an optimized shopping experience. Technology has advanced and its definition and implementation in retail space have moved beyond just having a digital presence to shaping and delivering superior consumer experiences. This article discusses five technology trends that are touted to do just that.
Personalized Customer Engagement - Personalization is the key for retailers to survive and thrive in this competitive retail battlefield. Retailers are taking personalization to the next level personalized product recommendations, discounts, highly targeted product offers, loyalty, and reward programs.
At the core of this customization is data modernization, the shift of data from isolated legacy databases to cloud-enabled data storage platforms. Data modernization is the first step of digital transformation as it allows for faster, seamless access to data, empowering efficient data analysis. With sophisticated cloud computing platforms, accelerated with DataOps and DevOps processes, retailers can rely on ‘always on’ data collection and processing to generate insights that can then help formulate consumer behavior patterns. Coupled with Machine Learning and Artificial Intelligence, this data can be used to engage with consumers in a smarter and much more effective manner.
For example, customers can receive an alert for free items on their birthday while shopping in a store. Or discount alerts can be sent via app notifications to less frequent customers when they pass by a store to motivate more purchases. With technology enabling better customer profiling, personalization, or rather, hyper-personalization is the way forward for the retail industry.
Omnichannel Retail Experience - Omnichannel presence is critical to providing an integrated shopping experience. Easy access to a retail brand through any channel makes shopping easier and hassle-free. Seamless integration between online and offline worlds is the basis of the omnichannel approach.
Again, enabled with efficient data modernization and cloud-based data storage, retailers can leverage AI for a variety of smart tools to engage with consumers at various retail touchpoints. Further, with the help of ChatBots and natural language processing tools, it becomes easier for customers to use AI-powered tools and get instant customer support and thus an effective brand experience. Customers can use the retail brand’s app while in the store, scan codes with their phones, and gain detailed information on products displayed. In case a particular color or size of shoe/ clothing/ accessories isn’t available in the store, an order can be placed then and there online through the app. The non-availability of a product or space constraints to display all products in-store need not translate into a lost sales opportunity.
Smart Inventory Management - Aimed at optimizing the inventory mix, levels, and locations, smart inventory diagnosis helps optimize inventory. By ensuring the right product, inventory is maintained based on data-driven insights of consumer demand and buying patterns. This is further optimized by location, to capture new sales, minimize excess and obsolete inventory, and analyze inventory levels and demand by location, on a regular basis.
Further, leveraging AI and data analytics, retailers can curate personalized messaging, especially to capitalize on local store inventory by pushing information about product availability to online shoppers that is customized to their local stores. Additionally, using customer data from its app or cloud platforms, or digital wallets, product relevant recommendations can be made, such that when a product is out of stock at a local store, the app makes it easy for the shoppers to seamlessly order the item from their smartphone/ online retail platforms.
Immersive In-Shop Retail Experience - Technology has significantly transformed the way consumers shop in stores. While the concept of immersive shopping was once limited only to digital platforms, it has now expanded to physical stores as well. An immersive experience ensures consumers can interact with the products in the shop and understand them better.
And Augmented Reality (AR) and Virtual Reality (VR) enabled experiences are at the core of immersive retail experiences. With interactive displays that disclose more details about a product through videos or animation booths that interest and motivate consumers to stay longer and experience the stores, AR and Mixed Reality have had a huge role to play in keeping retailers coming back for in-shop retail experience. In-store maps to navigate through the store coupled with interactive displays and virtual reality technology that gives a realistic idea of the product’s appeal enhances the decision-making process. Customers can visualize if a particular outfit, shoe, or accessory will look good on them resulting in quicker decisions and better satisfaction.
IoT-Powered Shopping Assistance - Again, effectively leveraging data modernization, cloud computing, and legacy application modernization for effective data analytics, retailers can engage with consumers to create personalization. This can further be applied to IoT-powered shopping experiences, which respond to personalized consumer needs and shopping behaviors.
Consumers are now more inclined towards contactless checkouts owing to health concerns raised by the pandemic. An IoT network in-store can track the products customers have placed in their cart and automatically charge the credit card which is in the record.
IoT applications like RFID chips that track product movement can help with inventory management and give better insights into the products that make it to the store but fail to translate to a sale. Interactive mirrors can help customers with product information. Customers can request sizes and browse products through interactive mirrors. The mirrors can also recommend accessories to complete the look facilitating a more fulfilling shopping experience.
The definition of optimized consumer experience is constantly evolving with the advent of new technologies and retailers are embracing them at a faster pace to survive and make their voice heard in this competitive landscape. Around 52 percent of consumers would spend more for a better consumer experience and this stat alone proves why tech adoption is no longer a ‘nice to have’ but an imperative. However, the right technology for e-commerce and retail solutions providers is vital in ensuring efficient, cost-effective, and personalized retail technology solutions for online and offline retail. If retail technology is to be made accessible and available across retail platforms, it is important for brands and retailers to embark on a well researched and sustainable solution with the right IT services provider, to build stronger digitization partnership that can help them to not only migrate but also sustain and scale up, using the best in technology adoption.