Retail has changed over the last few years. From ecommerce sales, now, to the return of the high street. Are there any pathbreaking trends for retailers?
The world of retail has changed significantly over the last few years. From a massive surge in ecommerce sales, now, to the return of the high street. No organisation can accurately predict the next world event that will have an impact on the industry. Currently, it is the rising cost of living crisis, with 73% of surveyees saying the cost-of-living crisis will affect both in-store and online in 2022. Whatever the future holds, all retailers need to maximise every opportunity to gain a competitive advantage.
Ultimately, the constitution of a successful retail business model isn’t simply black and white. There are many moving parts involved in the process. Each channel needs to create personalised experiences for all of their customers.
According to McKinsey, “haphazard efforts at omnichannel can destroy value”. So while offering an omnichannel experience may have been a “new” thing in the past, today, a strong omnichannel strategy is going to be a key differentiator. That said, here are 4 omnichannel megatrends to watch out for in retail.
Although the pandemic caused a record number of retail stores to close down, the end of last year saw an upward trajectory of stores reopening. This signalled that “retailers are reaching a balance between online and in-store shopping in the age of ecommerce.”
No doubt, the highstreet is being reborn. French retailer Carrefour acquired 172 Supersol point of sales in Spain to further strengthen its network. Adidas opened a new flagship store in Dubai adding digital signage services to offer a retail format closer to customers’ needs.
Other retailers have focused more on omnichannel. Zara launched “store mode”, a functionality that only shows customers the products and sizes immediately available to them at the nearest store that can be picked up in just 30 minutes.
The pandemic has been a driving force in pushing the retail industry to transform, and with the rising cost of living crisis affecting everybody, an opportunity is there for the companies who are able to enhance their offerings to meet consumer expectations.
Online and Offline
A lesson that retailers have learned from the pandemic is that e-commerce should not be considered a replacement to traditional retail but rather an additional channel.
This trend focuses on combining the strengths of ecommerce – versatility, quick selling – with the social components of the physical stores.
For example, Poundland in the UK lost customers during the various lockdowns and have now developed their online presence by setting up a transactional website to sell homewares, electricals, food and drink and other goods at low prices to entice bigger basket size and margins and rely less on physical stores.
Similarly, having trialled on-demand delivery through Deliveroo last year, UK supermarket Sainsbury has recently announced the expansion of its offering by more than 30%, claiming it has the biggest grocery on-demand service in the UK.
This demonstrates how retailers, whether they had to move to ecommerce by choice or by force, are now embracing, activating, and powering up new digital channels to maximise potential. 67% of marketers are investing in more engaging in-store experiences to attract people back to the high street and this trend will continue. The challenge for retailers is guaranteeing an exciting and quality customer experience to maximise the potential of both channels and to future proof revenue streams.
Adoption of new Technologies
There is an array of new technologies that are being used in retail, whether to simplify the customer journey, improve the customer experience, optimise the supply chain, or set up new delivery services.
At the end of last year, Israeli supermarket chain Machsanei Hashuk announced its partnership with Walk Out, which fits shopping carts with devices that use edge computing and machine vision algorithms to track the customer’s journey and offer personalised recommendations, store navigation and promotions on a large touchscreen.
In addition, with blockchain now being part of our everyday life, it is no surprise that it is now entering the fashion world with LVMH announcing its collaboration with Microsoft and ConsenSys to develop blockchain technology to track and trace high value items.
And while these are deployments that are happening at the front end of the customer journey and experience, there is also more happening behind the scenes that consumers may not be aware of. UK supermarket ASDA, for example, has adopted an AI engine to help with its forecasting, inventory management, and waste reduction.
Several new technologies have been introduced as these have been seen to have a distinct effect on customer’s experiences. New technologies are being used to create powerful emotional experiences that are proving vital in building customer loyalty and boosting customer retention. Retailers will continue to be used in different ways to better meet customer expectations.
For Ed Greig, Chief Disruptor at Deloitte, “the Metaverse is the internet but in 3D”. For others the metaverse is a collection of virtual experiences where customers can interact with other people and virtual objects with an avatar.
According to the World Economic Forum the metaverse is going to change how we buy our retail products and rather than reducing physical sales, it will bridge the physical and the digital. Many retail brands have jumped on the bandwagon with Italian fashion label Roberto Cavalli, for example, offering gamification experiences where it is possible to buy real products or Adidas launching a line of NFTs to create an exclusive fan community with special access to discounts. This trend is expected to grow, with 53% of retailer leaders believing it may be a future channel in the future.
The bottom line
The retail industry will continue to change and develop in various ways. As a result there will be several opportunities for retailers to generate a competitive advantage and advance their offerings. Whether via the Metaverse or investment in physical stores, retailers need to be aware of these ongoing omnichannel trends to ensure they are maximising all opportunities and providing the best possible service for customers.
ABOUT THE AUTHOR
Alexios Blanos, UK Business Director, M-Cube
Alexios has over 15 years of expertise under his belt – leading successful global business development strategies and developing cutting-edge solutions in his role at M-Cube. Working with brands such as EE and Dolce & Gabbana, M-Cube is revolutionizing the way brands create captivating digital experiences and innovative communication solutions. As the UK Business Director, Alexios fuels M-Cube’s strategy through digital transformation, innovative technology, and global partnerships.