DIGITAL TRANSFORMATION IN RETAIL — REMODELLING RETAIL INDUSTRY

What is Digital Transformation in the Retail Industry?

Challenges that you can face when transforming your retail business digitally

  • Moreover, changes in roles create challenges in proving ROI and taking ownership. Therefore, retailers usually have doubts and unwillingness to implement new ways of working.

Following are some of the key factors that are driving digital trends in the retail industry

  1. Increased number of social media and internet users
    Provided the deep correlation between economic affluence and internet inclusion, connecting billions and trillions of users to the world wide web is one of the significant and most prominent opportunities for the retail industry. Expanding the trend of using the internet through wireless devices equipped by technologies, including 3G, 4G and public Wi-Fi, has placed mobility at the center of the next big revolution for retail businesses.
  2. The increasing number of smartphone users and the growing use of m-commerce
    Smartphone usage statistics reveal that an average person spends more than 2 hours and 51 minutes per day on their mobile phones. 51% of users check their mobile devices a few times per hour and 22% of users look at phones every few minutes. More than 2.71 billion people in the world have smartphones and it is expected that mobile owners worldwide will increase to 7.33 billion by 2023.With the increased usage of smartphones, it is expected to drive the growth of mobile commerce in the retail industry.
  3. Digital Infrastructure
    The fourth industrial revolution or Industry 4.0, is defined by emerging technologies that blur lines between the digital and physical worlds. Combined with powerful analytics tools, including scenario analysis, predictive learning algorithms and visualization, access to data is transforming how companies perform. Companies can now collect vast data sets from physical facilities and assets in real-time, execute advanced analytics to generate new insights and make more effective decisions. The digital revolution is transforming the way products are designed, developed and delivered to customers. It offers tremendous implications for the retail value chain.

Technologies helping in digital transformation for the retail industry

1. Data Analytics

  • Retail players can predict the future performance of different products based on the customers’ existing interests and likes.
  • With price optimization, it becomes possible for retailers to determine when to drop or raise prices. Before analytics was introduced, retailers would drop prices after a buying season ends for a specific product.
  • At the same time, analytics represents that a gradual price drop from when demand starts vanishing would result in increased revenue. The US Retail Stage Stores used a predictive approach and performed some experiments to determine the fall and rise of demand for a specific product.
  • Walmarts, one of the biggest retail giants, spend millions on investing in real-time systems to develop the world’s largest private cloud to track and monitor millions of transactions and optimize pricing for all products.

2. Artificial Intelligence (AI)

  • How are retail companies using AI technologies to stay ahead of competitors?
  • Which AI applications can automate and augment the retail process?
  • What innovations are considered as potential game-changers over the next ten years?
  • AI can help make customer service effective and better by analyzing customers’ data and behavior. Offline stores can also leverage the potential of AI in a number of ways. What if you visit a store and you come across a friendly robot instead of a salesman. Customers can ask as many questions as they want from the robot, instead of talking to a salesman. It ensures the least contact with a human being, ensuring no risk of spread of the infection post-COVID-19 outbreak.
  • Also, AI-enabled robots will feed the data and analyze it to identify customer likes or dislikes and predict future sales. For example, if a customer is looking for a moisturizer, they can ask your robot for product recommendations based on the skin type. Therefore, the overall experience gets interactive for customers.
  • It helps create an engaging experience for users based on their likes and interests. Moreover, retailers can forecast how well a product is likely to perform in the market by learning from past experiences.
  • With a touch-based and gesture interface, a customer can mix and match different outfits, shoes and accessories to select the final look and decide what to buy. It reduces the time that people spend on making buying decisions.
  • Video analytics can also enhance in-store security and lessen the chances of theft. Using AI, surveillance data can be controlled in real-time and notification can be sent to store owners and administrators for quick action.
  • Chatbots are designed to answer queries, offer instant support and provide shopping recommendations. With a combination of AI chatbots and human beings, retail brands can handle customers effectively and provide customers with a proper resolution of their problem.
  • When customers get quick and personalized attention, they get engaged with the brand deeply, enabling improved customer loyalty.

3. IoT

  • Though it can be quite terrifying to trust a robot to be your customer service representative, it’s a great opportunity to cut down on forcing your workforce.
  • OSHbot, Lowe’s newest robot employee, helps customers detect certain products and provides information on inventory and promotions. Also, OSHbot answers in two languages, including English and Spanish.
  • By handling simple inventory tasks, robots free up the human workforce to emphasize on offering top-notch customer support.
  • Smart shelves are equipped with RFID tags, weight sensors and readers to scan products on both stock and display shelves. Using smart shelves, you can get to know when you have fewer items on the shelves or when items are not placed correctly on a shelf.
  • Since each RFID tag is connected to the reader, smart shelves can monitor in-store thefts, saving you money on cameras and security personnel.
  • Developing an automated checkout system with IoT devices would make your consumers happier and they will be willing again and again to enter your store. According to McKinsey, automated checkout systems can reduce the need for cashier staff by up to 75%.
  • In-store layout optimization
    You can be surprised to know that your retail store is not optimized for your customer’s behavior. Your store might have the least popular products in the front or your customers may need more space around couches in the back.
  • By implementing analytics software with infrared sensors, you can utilize IoT technology to enhance your retail layout. Therefore, IoT can help you optimize the in-store layout effectively.

Conclusion

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Full-stack software development company for startups and enterprises using blockchain, AI, IoT, AR and cloud computing. https://www.leewayhertz.com

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LeewayHertz

LeewayHertz

Full-stack software development company for startups and enterprises using blockchain, AI, IoT, AR and cloud computing. https://www.leewayhertz.com

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