Guest Blog by Richard Lim, CEO of Retail Economics.
The shift towards digital channels in retail
Today’s customer journey is truly unrecognisable from the analogue path observed just a decade ago. Seismic shifts have fundamentally changed the manner that consumers discover, research, purchase and consume goods from retailers of all sizes, types and across all channels. A plethora of varied touch-points influence, enhance and intelligently ‘nudge’ shoppers through an ever-expanding number of paths to purchase, from increasingly personalised social media campaigns to stockless stores where merchandise is viewed through augmented reality apps.
This paradigm shift has created significant challenges for the retail industry. The role of the store has evolved from mere product distribution hubs to meaningful customer experience environments, offering discovery, entertainment and escapism. Meanwhile, the physical and digital consumer experience has been blurred with in-store digital touchpoints that distort the purely analogue experience of old.
The inevitable acceleration of digital consumer experience
Successful retailers have had to reinvent themselves to stay relevant. The most successful listen to their customers, embrace change and invest wisely for the future. However, the race to digital transformation is occurring at such a pace, many retailers are struggling to keep up with disruptive frontrunners, leading to the recent wave of retail CVAs and administrations.
As we gaze into the future, we will undoubtedly see the rate of change accelerate as artificial intelligence and 5G connectivity dovetail to enhance retailers’ capabilities for speedier and cheaper online fulfilment. Meanwhile, innovative new retail business models will emerge. Subscriptions, auto-replenishment and more experimental stores will drive online sales to heights where the internet will be the largest retail channel within the next 10 years.
The question of data protection
Retailers enjoying success appear to be those who quickly adopt new technologies to leverage new opportunities. However, new risks are emerging which concern the use and protection of consumer data. People are increasingly conscious over their data protection rights and seek an equitable exchange of value in favour of data relinquishment. With this backdrop, the impact of future technologies and consumer acceptance is highly uncertain.
The burning question for many retailers is whether they can pivot swiftly enough whilst swimming against unpredictable tides of digitisation. Retailers must embrace change, have a unique proposition and continue to innovate in order to survive.
About the Partnership:
Hitwise is excited to announce our partnership with Retail Economics, combining their expertise in economic modelling and retail forecasting with the vast data sets and online behavioural analytics at Hitwise. Through co-published industry reports and thought leadership content, this partnership will provide macro and micro-level, timely insights to the retail industry.
For more information on Retail Economics, visit: www.retaileconomics.co.uk