Vikram AhujaThe retail industry has been in the midst of massive transformation over the last two decades. From adopting eCommerce and omnichannel customer journeys to implementing intelligent supply chains, deploying automated warehousing, and testing new retail concepts, retailers must adapt to a rapidly changing environment. The way consumers shop and what they expect from retailers have changed significantly in the post-COVID era. Consumers are moving their money toward retailers that offer better, more personalized digital services.
As straightforward as it may seem that consumers want both physical and digital shopping experiences, retailers continue to find innovative and meaningful ways to address this need. Increased connectivity, social media, and mobile adoption have changed consumer behavior and forced retailers to keep up with the latest digital trends. Today, every retailer is a technology company. The global digital transformation market in retail was valued at nearly USD 144 billion in 2020 and is expected to reach USD 389 billion by 2026. And according to a recent survey, only 20% of retailers feel prepared for the retail innovation trends. The industry is so competitive that 88% of retailers are developing these disruptions in-house and 91% are working with their IT partners to rise above the fray and stay competitive.
Digital is more than just a channel, it’s a mindset. It’s about how you think about customers, products & services, and how you engage with them every day. Retailers need to stay ahead of the curve and understand how emerging digital trends can help them improve their business.
Here are five disruptive digital trends you should watch out for that will change the retail industry over the next four years.
Trend 1: Personalized customer experience
Customers want brands to remember them as individuals and make recommendations based on their past behavior. This is why optimizing the user journey and developing intuitive navigation are of utmost importance. It’ll guide shoppers through the buying process from start to finish — from product discovery through checkout — without frustration or confusion. The customer journey has evolved from a linear path to a multi-channel one that is based on the customer’s interest, purchase history, location, and other data points. The goal for retailers is to deliver an engaging experience that aligns with the customer’s intent, which can be achieved through personalized product recommendations, content, and navigation.
Shoppers want convenience above all else. 76% of consumers say convenience is a key priority in selecting a retailer. So retailers are creating apps with intelligent buying options that allow them to scan products using their mobile devices and make purchases without needing to go through a checkout process. AmazonGo stores are a game changer with their scan-and-go technology that has taken the convenience factor up by several notches. Brands like Walmart and 7-Eleven have also recently introduced their checkout-free store successfully.
Trend 2: Monetization opportunities with unified commerce
The rising popularity of eCommerce has led to the emergence of unified commerce platforms – with 86% of all spending on retail software globally focused on this. With unified commerce, retailers can combine all the business systems such as inventory management, customer relationship management (CRM), order fulfillment, and point of sales into one platform that serves as an end-to-end growth driver. Retailers can keep an eye on the performance of each channel and simultaneously offer customers greater convenience and a smoother process of order fulfillment.
Additionally, to help customers find products more easily, retailers are investing in automated product categorization solutions that can be used to organize inventory according to different attributes such as color, feature, or brand. This allows customers to browse through categories rather than search through thousands of items manually. Product categorization can also help retailers improve their marketing efforts by highlighting certain products over others. Buyers want interactive experiences that provide them with valuable information before they make purchases. This is where digital advertising comes in handy – by using rich media banners or video ads with dynamic content, businesses can deliver relevant messages that resonate with consumers at just the right time during the buying cycle when these messages will have maximum impact on their purchasing behavior.
CRM is one area that has been impacted the most by digital disruption. The data gathered in the CRM is used to improve customer service, marketing, operations management, and to create unique experiences for each customer so they will return again and again – with loyalty schemes. Understanding how long the customer’s been with you, how frequently they purchase from you, and whether or not they’re likely to purchase again makes it easier for retailers to offer loyalty programs that will encourage customers to stay loyal while rewarding them for doing so. There is a massive opportunity today in the loyalty management market with studies forecasting over 2x growth in the global market size valued at USD 18.2 billion by 2026. The lifetime value of a customer should be considered when setting up a loyalty program so that retailers are not wasting resources on people who are unlikely ever to buy from them again in the future.
Trend 3: Increased emphasis on security and privacy
A recent study listed the retail industry as more likely to be impacted by a security incident. Yet, a Deloitte survey reported merely 5% of consumers ranked the digital retail sector among the top three at the risk of a security breach.
As the retail industry continues to evolve, security and privacy concerns are becoming more crucial. And when it comes to customer information, there is no room for error. Security breaches are back in the spotlight due to sophisticated cyber-attacks. 44% of retail organizations were hit by ransomware just last year!
The 2017 Equifax breach has made clear that companies must be aware of the risks involved in working with sensitive customer data and make sure that their platforms and solutions are secure. It’s not just about protecting our customer’s data, but also about protecting their trust in the brand. A study by KPMG found that two-thirds of consumers are willing to pay more for products from companies they trust.
It is no longer enough just to have good security policies in place; companies must also ensure that they have sufficient resources available to them in order to improve their security posture. Data loss prevention (DLP) technology can help retailers protect customer data by preventing unauthorized access or sharing of sensitive information. Some DLP solutions can also detect and prevent malware from being introduced into systems before it can cause damage or harm customers’ information. And encryption software prevents unauthorized access to confidential information even if attackers manage to break into your system — it protects your customers’ personal information against data breaches.
Trend 4: Focus on supply chain agility
In recent years, pandemic disruptions exposed inefficiencies in the supply chain, making some retailers realize how ill-equipped they are to anticipate and meet sudden market disruptions and inflated consumer demand.
The opportunity exists for retailers to centralize control over inventory through a single platform that provides visibility across all channels and locations, with automated replenishment and analytics capabilities to empower faster decision-making based on real-time data points rather than historical ones. AI-based sales forecasting tech can provide insights to decipher buyer patterns and therefore optimize lead times and eliminate chances of stock outages, failures, and defects. This will allow companies to become more agile and resilient when responding to market changes.
Demand for integration services and the implementation of solutions to optimize inventory and supply chain management increased with the global market value significantly rising from $15.85 billion in 2019 to $37.41billion in 2027.
Predictive analytics/forecasting is just one aspect of AI-based tech in supply chain management. The application of AI has significant value for the entire supply chain management process – everything from supplier relationship management to computer vision systems that can automate and improve the quality assurance of finished products. Additionally, AI-powered with big data can make supply chains more sustainable and greener. Most of the companies’ indirect emissions are through their supply chains. AI can optimize logistical routes to minimize carbon emissions.
Trend 5: Maximizing staff productivity with tools
Hot take: You may be setting even your very best employee up for failure if you don’t provide them with the right tools. Collaboration and performance management tools are invaluable in a distributed workforce. And so are tools that enhance productivity to perform the core activities. We know that a more productive workforce leads to a better customer experience. With capability centers across emerging hubs powering innovation and digital transformation for the retailer, there is no longer one central location where employees work and interact with customers. To ensure that these employees remain productive, retailers need to adopt the right productivity tools and CRM systems.
CRM systems allow managers to have real-time access to customer data. With the right productivity tools and data dashboards, retailers can gain better insights into their operations and provide greater clarity into how important metrics impact the bottom line. The retail industry has highly variable demand patterns, sales volumes, and unpredictable workloads that can change dramatically from one month to the next. Productivity must be measured against these changes in order for companies to make informed decisions about staffing levels at any given time.
The pandemic coupled with digital transformation has accelerated the demand for skilled talent globally. To meet this demand, organizations are looking to build their own capability centers. The current hiring trends show a significant uptick in hiring for roles in solutioning, core growth, virtualization, and enterprise mobility among others.
The most impactful roles being hired in global capability centers
- Product engineering: Java, Javascript, React, Full-stack Engineer, Automation Tester
- Mobile engineering: Android, iOS
- Analytics: Data Engineer, Data Analyst, Data Scientist
- Infrastructure: Cyber Security, DevOps, Cloud
- Artificial Intelligence: ML engineer, Chief AI Officer, AI Strategists
As the retail industry continues to transform, companies that adapt to emerging digital trends are forging new opportunities for growth, including the ability to close the gap between online and offline experiences and constantly provide value, convenience & selection. According to Talent500’s recent survey, for 53% of tech talent, the chance to work with an international company is one of the top motivations for looking for a job. And the #1 champion in this journey to success is talent.
Take the first step towards global hiring with Talent500. Request a free consultation and gain access to exclusive insights into talent strategy in over 50 countries.
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Harsha Satyakam
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