Retail 4.0: Revolutionising the brick-and-mortar industry through emerging technologies
Emerging technologies present new possibilities for the retail industry to accelerate performance and growth, and ride the digital transformation wave.
Emergence of Industry 4.0 has led to a steep shift towards the adoption of digitisation. Advanced technologies have revolutionised retail industry bringing forth its new avatar - Retail 4.0. From automation of the operational process to churning of digital data encompassing buyer’s journey that is proving instrumental in retail business strategies, retail is sure undergoing a renaissance of sorts.
As per the BRP Consulting Consumer study, a staggering 79 percent of consumers indicated that a personalised service from a sales associate was an important factor for them in determining at which store they chose to shop. This emphasises that personalisation has become a critical component for enhancing a customer’s shopping experience.
Similarly, in the digitally enabled world, customers have become savvier and are looking for personalised experiences. As the shift from pure brick-and-mortar to omnichannel gathers pace, customers are leveraging the convenience of shopping anywhere, anytime and, in turn, expecting retailers to deliver differentiated experiences. Today’s retail sector is contending with consumers who have more spending power but low brand loyalty, which has led to shrinking product and trend lifecycles.
Both technological advances and changing customer profiles are forcing the retail industry to rethink everything from store formats and payment methods, to harnessing the power of data to transform retail operations. The new retail landscape implies that retailers need to become nimbler and more adaptive to consumer trends, while delivering a seamless omnichannel customer experience.
For long, retailers have worked on instincts to understand customers and serve them better. However, in a rapidly evolving world buffeted by technological advances, increasing competition, and explosion of data, retailers need to leverage emerging technologies such as virtual reality, augmented reality, mixed reality, Internet of Things, and AI to unlock actionable insights and drive real frontline differentiation.
Data shows the way
Smart retailers are adopting a data-first strategy to map the buying behaviour of customers and plan their sales and marketing strategies. Business leaders are less dependent on historical trends and intuitive or pure instinct based on years of experience; instead, they are leveraging the power of predictive data analytics to make informed decisions.
Using retail analytics platforms, retailers and marketers can drive optimisation, take corrective measures, and prevent revenue leakage. Retail analytics platforms enable retailers to provide customers with what they precisely need – relevant products, informed and fast customer service, and the facility to pre-experience products.
Retail analytics empowers retailers to define the way they target customer acquisition. Deep insights pertaining to purchase patterns, frequency of purchase/shopping, search criteria, etc. are being used by retailers to focus and personalise their customer engagement strategy.
Retail analytics can also help predict demand accurately. Based on a customer’s purchase history, data analytics can help retailers anticipate the demand of the shopper and predict what the customer is likely to purchase and when. Retailers also use analytics and AI to predict products that customers are most likely to purchase together. By mining historical data, advanced machine learning algorithms can throw up insights, which allow retailers to generate accurate recommendations, and thus increase share of wallet.
Emerging technologies like IoT and AI make it possible for retailers to monitor all the interactions between the customer and the store, thereby understanding the nuances of the purchasing journey. Based on rich customer interaction data like interests, wish lists, preferences, and purchases, retailers are also able to provide a curated purchase experience and informed service engagements.
With social media offering extensive insights into consumer behaviour, it has become important for retail market players to keep track of the ever-changing needs and expectations of customers, to the point in fact of almost ‘reading’ their mind. With natural language processing and machine learning, retailers can post extracting information from social media sites and use it to gain that vital edge in the marketplace.
Value for money
One truth that has become truer with technology is that customers are always on the lookout for reasonably priced quality merchandise. Not only do they compare prices online while shopping in stores, they also find and use apps that give them discount codes. The findings from BRP Special Report shows that 64 percent of consumers feel doubly satisfied when they receive something valuable in lieu of their repeat purchases. Hardly a surprise then that their loyalty rests with retailers that give them the maximum bang for their buck.
That makes a price optimisation strategy extremely important for a healthy and growing bottom line. By leveraging retail CRMs, ERPs, and pricing analytics software platforms, retailers can make data-driven decisions to take their operations to the next level.
The rapid and disruptive transformation of the retail sector puts serious pressure on retailers even when it comes to deliveries and order fulfillment. The supply chain was often viewed as a support function and cost efficiency driver; however, Retail 4.0 has led to a transformation of the supply chain as a competitive differentiator and enabler of strategic growth.
Smart supply chains
Emerging technologies such as ERPs can be employed to create intelligent and agile supply chains that can help retailers and marketers not only increase the flexibility and speed of fulfillment but also optimise costs. Companies can increase speed to market, offer new delivery options, and provide immediate access to products, deliver customised services to consumer segments, and improve inventory accuracy and responsiveness.
With retailers focusing on fulfillment practices, product distribution, speed and convenience of delivering products, transforming the supply chain has become an existential imperative for retailers striving to grab a secure foothold in an integrated marketplace.
The only way to be competitively ahead is to constantly adapt to the changing industry and upgrade to the latest technologies.
(Edited by Evelyn Ratnakumar)
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(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of YourStory.)