The Impact of Technology on the Retail Industry

September 07, 2022 | Retail

From the mom-and-pop shops at the heart of their communities, to the superstores providing choice and convenience in airy and relaxing surroundings, it’s easy to take the retail sector for granted.

Yet look a little closer, and it’s actually where much of the best technological innovation is taking place today. As retail design firms try to help outlets make the most of profit, convenience and efficiency, technology is providing the roadmap to make all new ways to provide outstanding customer experience.

Technology in the retailing industry

Bricks and mortar stores aren’t going anywhere, no matter how fast ecommerce grows. From enhanced security to help stop thieves and vandals, through to enhanced data management tools that can help business leaders make more informed decisions, it is an era of innovation and invention when it comes to retail technology.

The future of retail design: Technological trends in the retail industry

Retail outlets using customer data to map out where to place their best deals, for example, or superstores using AR to add extra incentive to the buyer journey, are all examples of retailers putting technology to use.

This retail technology ranges from wow-factor tech for consumer engagement to smart systems that enhance the management and daily operations of stores across the world.

Here are a few examples of some of the most compelling breakthroughs.

Big data analytics in retail business management

Big data is big business, especially in the retail sector. By intelligently gathering and parsing through information on customers’ age brackets, gender identities, demographic backgrounds and even the times of the day they are most likely to spend, business leaders can more effectively plan their store’s forward strategies.

Retail inventory management software for small businesses

Gone are the days of colleagues on the shop floor trudging around with clipboards and manually counting cans and cartons.

Today, retail inventory management software is able to accurately pinpoint how much of which items are in which department, helping shape when to reorder new products and when to slash prices to move old stock.

Shelves embedded with sensors for more accurate inventory management

Once again, store colleagues can be freed up from the need to patrol the store and count stock levels manually with the help of smart shelves, which can also help tailor deals to customers’ needs and cross-sell complementary products.

Smart shelves can easily connect to the wider store infrastructure IoT network to help stores sustain efficiency, pre-emptively inspiring any restocking as required.

VR/AR technology to enhance the in-store shopping experience

It’s easy to dismiss virtual reality and augmented reality as gimmicks, but the truth is that they can powerfully shape customer buying habits when deployed correctly.

As you can imagine, uses of this technology are vast and varied. Fashion retailer ASOS lets you dress AR models to see how outfits look in real time; IKEA lets users experience furniture assembled and sized to suit their space; and L’Oreal lets users simulate how makeup looks on their facial features long before they commit to a purchase.

Robotic AI assistants that deliver next-level service

Taking a step beyond the chatbots that have become ubiquitous in online customer service, AI assistants like IBM’s Watson or Amazon’s Alexa have become crucial advisors on the customer journey.

Offering product advice, delivery times and helping to resolve any disputes or transaction enquiries, these AI assistants free up business colleagues to focus on more demanding tasks in keeping the store going day to day.

Advantages of new technology in the retail industry

Reduce costs by creating just in time relationships with suppliers

Better inventory management isn’t just a question of creating more space and better commitments to expiry dates for the products being sold by your business.

Retailers leveraging this technology well are able to enjoy just in time supplier relationships, in which goods come in and are put up for sale in an almost seamless and singular flow of throughput.

No more stock standing idle and time being wasted waiting for badly timed back orders.

Better managed inventory may improve profitability

Those retailers who are more capable in managing their inventory – empowered by smart technologies – can ensure that they’re making consistent profits.

Customers have faced countless shortages in both luxury goods and essential groceries since our new decade began, and their patience is wearing thin. That means that those retailers able to consistently deliver what customers want are likely to enjoy customer loyalty, and thus a far better bottom line as time goes on.

Make supply chain processes more efficient

Supply chains are under unprecedented pressures the world over, from the aftershocks of the global viral health crisis to the labor shortages and ongoing raw material sourcing difficulties plaguing everything from electronics to food and drink.

That makes the demands on retailers to create more efficient supply chain processes all the more pressing – and to that end, technology’s assistance in smoothing out those complexities is vital.

Improve customer satisfaction

The lifeblood of any successful retail business is customer satisfaction – and in the aftermath of the countless crises afflicting the world at large over the last few years, they have become more demanding than ever.

People need to believe that the retailers they choose are on their side, able to reliably offer good products and experiences at fair prices as the economy becomes a rising concern for us all.

With technology on hand, retailers can more effectively stay agile in the moment as customer preferences evolve, while also crafting longer term strategies that enhance engagement and repeat business.

Technology is enhancing the retail industry in countless ways, from augmented reality and enhanced customer experiences to greater precision and control over marketing data and inventory management.

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