Instead of the usual hustle and bustle of holiday displays and merchandise offered to catch the eye — and the wallets — of shoppers, retailers have found themselves grappling with a new layer of stress borne of the ongoing pandemic struggle and the economic mess left in its wake.
The advent of online shopping put pressure on retailers years ago to move forward with digital transformation plans. The pandemic only increased that pressure. In 2019, online shopping accounted for 14.1% of retail sales worldwide. When the pandemic struck, online shopping catapulted to 36% of all global shopping. The competitive tension created by e-commerce giants like Amazon have driven brands to venture into direct-to-consumer sales shifting the dynamics of their customer engagement.
Despite current conditions, there are some retail success stories emerging. What makes some retailers succeed when others have filed for bankruptcy protection or even liquidated because of the pressure?
A tech foundation is key for agility with online and in-store shopping
Retailers who demonstrate curiosity and adaptability in this rapidly evolving climate are thriving despite the issues swirling around them in the world. Retail companies that adapted more easily invested in an agile technology foundation that includes analytics early on, and they have already realized dividends. It’s important to remember that any retailer — regardless of size — can invest in the technologies that allow them to engage in click-and-collect fulfillment for customers.
The retail brick-and-mortar ecosystem is changing rapidly, too. There’s an entire network of chip sets, communications protocols and cameras that make up an effective infrastructure in a physical store.
The original intent of this infrastructure was geared to in-store promotions, but savvy retailers have pivoted the technology to better communicate directly with shoppers. Advances in internet of things (IoT) analytics and computer vision technologies are paving the way for any retailer to know its customers better.
The adaptation of technology was already taking place in retail, but the pandemic has accelerated that adaptation, and rightfully so. Retail survival depends on it.
Technology adaptation is here to stay, post-pandemic
Change brings opportunity, and the ways IoT technologies are helping the retail industry emerge stronger and smarter after the pandemic are many:
1. Computer vision: By using computer vision, a retailer can specify response procedures to ensure safety, apply loss prevention floor layouts, or even broadcast a recorded message to remind shoppers of social distancing rules.
2. Personalization: Driven by video, artificial intelligence (AI) analytics can help retailers realize an omnichannel view of customers to enhance the customer experience.
3. Biometric-tagged commerce (unique identifiers): Security concerns will drive the popularity of biometric-tagged commerce as organizations push to ease transactions for blockchain/crypto currency
4. Edge computing: Pushing computing to the edge of the network will enable zero latency decisioning for retailers. The drivers are connectivity, 5G and the need to minimize payloads.
5. Automation: The pervasive use of chatbots and robots will transform warehousing and the retail industry. Industrial AI and machine learning will be increasingly used for exception-based management given the vast amount of data generated by IoT.
The pandemic has accelerated technology adaptation. From social distancing to thermal imaging, technological advancements help turn raw IoT data (from video/cameras, etc.) into insights that fuel innovation and inspire action.
Pandemic-induced uncertainty means communication and technological advancements play a starring role in shoring up relationships with shoppers so retailers can emerge stronger, smarter and more agile when the pandemic winds down.