The Indian retail industry is considered one of the fastest growing industries in the world and technology is emerging as an efficient tool in nudging it to the forefront of global retail. But the retail industry is competitive, it’s relentless and the success of brands and retailers depends on how firmly they deal with their competition. One way to stay ahead of the curve is the incorporation of technology in a brand’s operating model.
With the industry transitioning from being product-centric to customer-centric, retailers are leveraging all sorts of technologies to reach the modern shoppers. This has resulted in retail technology transcending from ‘aspiration to expectation’ and wedging itself securely between consumer and experience to create an everyday interface. Technology today is giving brands the platform to better satisfy their customers by helping them concentrate on consumer needs.
Simply put, technology is beginning to play an increasingly important role in the management of complex retail operations all over the world. Because of the notoriously thin margins for retailers, anything that goes wrong in the retail supply chain can chip away at profit margins. Therefore, the right technology fit can make a huge impact on retailer profits. To stay ahead of the game, retailers are taking the help of different technologies to lead the way in changing two aspects: their points-of-sale and their points-of-supply.
What Research Says
According to a Walker study, customer experience will overtake price and product as the key brand differentiator by 2020 and 86 percent of consumers will pay more for a better experience. The challenge in serving the modern customer for most retailers lies in bringing about the right balance between technology and humans. Retailers with the foresight to understand the potential of technology without getting lost in its complexities, and merging it with human interaction, therefore, have always been able to grow faster and bigger. As per an Accenture study in 2019 titled ‘The Future of Retail Is Closer Than You Think: Retail Technology Vision 2019’, retail leaders are not bracing for the change that new technologies and changing consumer demands will bring to the industry. They are embracing it by actively looking for opportunities to grow markets of one. In so doing, they are changing retail’s traditional competitive strategy from buying quantities and selling efficiently to consumers to enabling consumers to buy exactly what they want from a retailer they trust.
The Study Goes on to Say that:
– 82 percent of retail executives believe digital demographics are becoming a more powerful way to understand consumers.
– 80 percent believe digital demographics give them a new way to identify market opportunities for unmet consumer needs.
– 71 percent believe digital demographics are expanding the number of ways they deliver products and services.
Retail Technology Trends of 2020
The dawn of e-commerce had dealt a huge blow to the traditional retail – that is until retailers discovered the advantages of Omnichannel and Phy-gital retail. With the advent of new technology, brands and retailers are now raising the industry from the simple concept of buying and selling.
Big Data & Analytics: Simply put, Big – Data drives towards a better customer experience. The customer experience is more important than ever as retailers struggle to differentiate themselves in an increasingly challenging market. But how retailers implement that customer-experience is shifting from a purely person-to-person approach, to something much more automated – but when done right, those automation tools supplement and enhance the human approach, delivering a vastly superior, and much more personal, customer experience.
For retail, the analytics and data upside is in demand forecasting and supply chain planning. In addition, better inventory visibility through a combination of data and systems as well as sensors to monitor in-stock/out-of-stock (on shelf, in warehouse, in transit) will continue to enable flexible transformation.
Blockchain: Blockchain makes retailers more efficient. While most people associate Blockchain with crypto-currencies and Bitcoin, its greater potential is in back-end applications that improve retail operations. The Blockchain framework allows all members of the value chain – supplier, manufacturer, retailer, consumer – to have visibility into products from source through production to store to consumer. Consumer goods can be certified with Blockchain’s anti-counterfeiting solution (Block Verify) for pharma, luxury, and electronics. Many companies today are also using solutions to move product warranty information into the cloud via Blockchain. This allows the warranty to be easily updated and transferrable.
Artificial Intelligence (AI) & Machine Learning: AI helps machines and devices learn from experience, adjust to new inputs and perform human-like tasks and intelligence. In retail, AI can be used to train computers to accomplish specific tasks by processing large amounts of data and recognising data patterns. It is used in e-commerce platforms, chatbot services and social media apps.
Similarly, machine learning uses pattern recognition to predict data based on algorithms. AI is being deployed by businesses to create websites, social media posts, run e-mail marketing campaigns, optimise content for different consumer segments. It is helping brands become more agile in their communications, as well as more responsive to consumer demands, as and when they change.
Augmented Reality & Virtual Reality (AR & VR): AR in retail isn’t all that new, with brands using it successfully since 2013. It is popular and successful as it delivers a simple, intuitive, high-value user experience for consumers. The simple way to understand is that with AR, one can easily with the help of his smartphone and can find out exactly how far s/he is from a shopping mall or a restaurant. The adoption of AR acts as an invaluable tool for retailers by providing insight and information supporting consumer buying decisions. Using AR applications to layer digital information — text, images, video and audio-on top of the physical world — represents an easy route to deeper engagement, both in-store and at-home.
In addition to this VR not only creates a simulated environment around but also provide other tactile sensations to give the consumers an absolute life experience.
Internet of Things (IoT) & Cloud: IoT connects the physical world to the Internet so that one can use data from devices to increase productivity and efficiency. Consumers have a plethora of connectivity options available in the market at minimal costs. IoT continues to evolve and expand in terms of the number of companies products, and applications that illustrate just how beneficial it is becoming to connect our devices, appliances, homes, and vehicles together.
M-Commerce: M-commerce has been a major contributor in the revenue generated by the global app economy, an economy whose number is expected to reach a whopping US $6.3 trillion by 2021. For retailers it has been proven by research that mobile app drives more engagement. A normal person spends an average of seven to nine hours on the phone in a day. As a result, mobile apps dominate the overall Internet traffic and generate around 3X more conversions in comparison to the web. Mobile users are used to simple UI and faster loading speeds, owing to the experience they get on the extensively used social media and messaging apps, something which bigger retail chains are striving hard to provide. Brands are using M-commerce to pamper their customers with personal service that inspires loyalty and appeals to shoppers’ emotions.
Technology Creates a New role in Retail Organisations
Technology is the knight on the white horse that will ride the retail market towards prosperity and triumph. With the aid of technology, brick-and-mortar retailers are implementing and adding a lot to their service quotient – self/ cashierless checkout systems, PoS innovations, VR and AR solutions, loyalty programs, Cash on Delivery, Card on Delivery, same day delivery and expanding mobile payments to customer loyalty programs. The advent of so many new retail technologies signaled the dawn of a new retail era. While many companies embraced technology with ease, seamlessly connecting all facets of their operations – frontend, backend, supply chain and deliveries – others grappled in the dark, unsure of what would work for their business. A lot of retail organisations started hiring technology experts to guide them in the right direction. The post of the Chief Information Officer / Chief Technology Officer (CIO / CTO) was born. We bring you a sneak peek at how top CIOs view the future of technology in retail. Indian retail’s IT gurus give us a lowdown on how prepared the Indian retail industry is to manage the impact of new technology, while talking about their personal favourite tech ideas – technologies they would like to implement in their organisations.
What Indian Retailers are Doing
While it has definitely made life easier for consumers, retailers in India have spent a better part of the last decade on their heels, reacting to profound changes throughout the sectors of the industry.
Retailers today are not fighting with other retailers anymore; instead they’re fighting with different technological interventions in order to be the most competitive in the world. With growing competition, it has become extremely vital for retailers to innovate continuously and implement cutting-edge technologies to fulfill today’s demanding customers’ need. In order to stay relevant in a highly competitive market, every retailer needs to stay on top of technological advances and also learn how to exploit these technical innovations to forward their business goals. Over the past few years, a number of technology trends have evolved and dramatically altered the retail industry. The emergence and the transformational growth of the new economy has unleashed powerful forces which are eventually and successfully reshaping the retail industry at a transformational speed. In order to succeed, today’s retailers have to off er a seamless shopping experience across all channels – and should not lose track of their customers.
Today, the entire Indian retail ecosystem has smartened with technology. There are so many things one can experiment with if a retailer uses technology, for example: smart displays, in-store services, smart shelves, home delivery, brand optimisation options, supply chain optimisation, logistics automation to name just a few. Then there are wallets, point of sale data, social networking – where you can home in on complaints as well as get appreciated. All this is driven by the retailer into applications where the consumer sees, feels, asks the retailer questions and eventually buys the product.
Giant players of the retail industry have accepted technology with arms wide open to captivate and secure customers and have made optimum use of technology to optimise their business. Whereas small retailers, most of them belonging to the unorganised sector, are yet to adopt technology to be adept with the changes and technological innovations taking place in the retail market. If the entire unorganised retail trade, which is 80 percent of the entire retail trade, adopts technology, the retail industry will usher in a new era providing a much-needed thrust to the Indian economy.