Welcome to the digital age! If you own a retail business, clunky cash registers, dusty shelves, and tangible receipts are things of the past. Today, the retail industry is humming to the tunes of retail digitization. But what does retail digitization mean, and why should it matter to you?
Retail digitization refers to the integration of digital technology into all aspects of business, fundamentally changing how you operate and deliver value to your customers. It’s not just about changing existing processes. It’s about reimagining how to bring together people, data, and processes to create value for your customers and maintain a competitive advantage in a digital-first world.
It’s like adding a superpower to your business toolkit – one that helps streamline operations, boosts productivity, enhances customer experience, and drives business growth. Sounds promising, right? Stick around, as we delve deeper into this digital revolution and provide a step-by-step guide to embark on this glorious journey of digitizing your retail business.
The Impact and Growth of Retail Digitization
Investment in Digital Transformation
As the rise in technology continues to create waves across different industry sectors, one of the most significant shifts can be observed in retail. This sector is presently witnessing the emergence of a new era, thanks to digital transformation investments. The process of adopting the latest advancements in technology to streamline business operations, enhance customer experiences, and improve overall business performances is seeing a rapid uptick.
Believe it or not, the direct digital transformation investment in the retail sector is expected to reach a staggering $7 trillion. That’s not all, this investment is forecasted to deliver a Compound Annual Growth Rate (CAGR) of 18% from 2020 to 2023. These staggering numbers are a clear testimony to how significantly digital improvements are shaping the future of the retail sector.
Digital Sales Increase
Behind every exciting business turn-around story, you’ll find a digital transformation angle these days. Company after company, in reaping the rewards of having undergone extensive digital transformations, reported significant increases in their sales. A compelling study by the Boston Consulting Group backs this up, reporting substantial growth in sales on average for companies that have adapted digital platforms effectively.
eCommerce Future Predictions
Speculating the future has never been easy, but the numbers tell a clear story for eCommerce. If the current shopping trend is anything to go by, Statista predicts an incredible $8.1 trillion in eCommerce sales by 2026. By 2023, it’s estimated that over 50% of all consumer spending will be done online—a phenomenal shift in consumer purchasing habits.
Shift to Mobile Commerce
Smartphones have become our trusted companions, influencing many facets of our lives—including shopping. The growth of digital retail isn’t just limited to desktop eCommerce; mobile commerce is also rapidly growing. It’s expected that close to 60% of digital buying will be done through mobile by 2023. Moreover, studies show that 80% of customers now shop from mobile apps, a testament to the rise of mobile commerce. The shift to mobile commerce is not the future—it’s happening right now!
This isn’t just a trend or a blip on the radar. It’s an all-encompassing lifestyle change brought about thanks to the advancements in technology and the convenience it offers. The global retail landscape is transforming, and businesses that adapt to this shift quickly will be the ones leading the marketplace.
The digital dawn in the retail world has arrived, changing the dynamics of consumption, and the only way forward is to embrace it. Companies should consider capitalizing on this tremendous growth of digital retail, maximizing their market potential and ensuring their long-term viability in a competitive landscape.
Creating a Connected Shopping Journey
In this fast-paced world of digital evolution, shopping habits are continuously on the move. Consumers are not confined to physical stores anymore, and they are leveraging the power of smartphones and the internet to make their shopping journey effortless and efficient. Adoption of smart strategies that create a connected shopping journey is a game changer for retailers. Here, we will dive into the significance of pre-purchasing research and in-store smartphone usage.
Pre-Purchasing Research
With the emergence of the internet, research before making a purchase is now a piece of cake. Gone are the days when consumers had to rely merely on shopkeeper’s advice or friend’s suggestion. Today, buyers explore the internet to get a full picture of what they plan to buy. It is remarkable to note that 90% of pre-purchasing research happens online. This data highlights the importance of having an impressive online presence for retailers. Buyers look for reviews, compare products, examine prices, and also hunt for deals online before moving ahead with their purchasing decision.
Ensuring that your online content is SEO-optimized is the key. It can not only influence a potential buyer’s decision but also improve your product’s visibility. Detailing the features, benefits, usage, and price of a product in a user-friendly language can engage customers and enhance your brand’s credibility.
In-Store Smartphone Usage
Equally significant is understanding and capitalizing on the in-store smartphone usage behavior of customers. When inside a physical store, 90% of people use their smartphones. This trend presents a golden opportunity for retailers to optimize the in-store experience.
Customers use their phones in-store for a variety of reasons – to compare prices, read reviews, check product information, look for deals, or to engage on social media. Recognizing these patterns can help retailers in personalizing shopping experiences. Retailers can provide Wi-Fi facilities, QR codes for easy access to product details, targeted offers, etc., thereby ensuring that the smartphone usage inside stores adds value to their shopping experience.
Creating a connected shopping journey involves understanding how digitalization has transformed the buyer’s journey. It’s about embracing these changes and using them to advantage. By creating seamless online-offline integration, and recognizing the power of pre-purchasing research and in-store smartphone usage, retailers can effectively connect with their customers, providing them with an experience worth returning for.
Digital Transformation in Retail – Key Strategies
The retail industry is currently neck-deep in the digital revolution, reshaping the landscape and how businesses operate. Innovative technologies and strategic adoption continue to alter the customer experience, and we are covering key strategies that forward-thinking retailers are implementing for a successful digital transformation.
Digitizing Processes
The first step in any revolutionary journey is accepting and embracing change. For the retail industry, this means digitizing traditional processes. Spotting trends, observing behaviors, and gathering key insights is much easier with digitized assets. A host of sophisticated technologies come into play here:
- Big data analytics
- Location-based services
- Mobile apps
All of these are significant tools in a retailer’s arsenal for business transformation. They streamline operations and provide valuable data that assist in making informed business decisions.
Hiring Technology Skilled Individuals
Strong skills and knowledge form the backbone of implementing any transformation. As such, attracting and retaining individuals proficient in key technologies is integral to facilitating a smooth digital transformation. These technologies could include:
- Data Science
- Machine Learning
- AI
- Internet of Things (IoT)
These talents help to spearhead technology-driven projects, devise new strategies, and ensure seamless integration of digital tools into the existing framework.
Adoption of Relevant Technologies
Adoption of innovative technologies can greatly enhance customer experience. Smart technologies, like robotics, smart shelves, and automated checkouts, improve customer services in retail stores, creating a seamless and advanced shopping experience.
Unified Commerce Implementation
A game-changing strategy for retailers is the implementation of a unified commerce model. It brings together the physical and online stores, forming a cohesive shopping experience. This strategy realizes the concept of buy anywhere, fulfil anywhere. Furthermore, in-store digitization, a key aspect of unified commerce, provides personalized browsing and buying experiences for customers, giving retailers a much-needed edge.
Going Paperless
Lastly, going paperless is not only environmentally friendly but also a step towards increasing efficiency within the organization. Digital data is easier to store, search, and share. It paves the way for leaner operations and a clutter-free working environment, crucial to any digital transformation.
In the world of retail, digital transformation is no longer an option, but an imperative. Leveraging these key strategies can position retailers to stay ahead of competition, meet changing consumer demands, and drive sustainable business growth in the digital era.
Conclusion: The Future of Retail Digitization
Retail digitization isn’t merely a buzzword floating around entrepreneurial circles anymore — it’s here, and it’s revolutionizing the way we conduct business. Customers today crave for a seamless shopping experience that melds the ease of online shopping with the tangibility of physical stores. This connected shopping journey is what we are heading towards, a future driven by digital advances.
In this landscape, retailers need to adapt and evolve — or risk being left behind. By investing in digital transformation and adopting relevant technologies, businesses can stay ahead of the curve. Strategies like going paperless, hiring technology-skilled individuals, and implementing unified commerce are just some of the ways retailers can help propel their business into the digital age.
Four Seasons General Merchandise is a brilliant example of a company leveraging digitization to its advantage. As a leading supplier for a variety of stores and nonprofits, the company has successfully integrated digital solutions across its operations for seamless business efficiency. You can explore more about them here.
Remember, in this digital age, embracing change isn’t optional — it’s a business necessity. These technology-driven retail innovations are shaping not only the current retail landscape but also its future. Every step taken towards digitization now is a significant stride towards a future-proof business. So, get started on your digital transformation journey today!
Frequently Asked Questions
- Why is digitizing important for retail business owners?
Digitizing your retail business can help you streamline operations, reach a wider audience online, enhance customer experience, improve inventory management, and increase overall efficiency and profitability.
- What are some key steps to digitize a retail business?
Key steps to digitize a retail business include: 1. Establishing an online presence through a website or e-commerce platform, 2. Implementing a point-of-sale (POS) system, 3. Utilizing digital marketing strategies, 4. Investing in inventory management software, and 5. Embracing customer relationship management (CRM) tools.
- Do I need technical knowledge to digitize my retail business?
While some technical knowledge can be helpful, it is not a prerequisite to digitize your retail business. Many user-friendly tools and services are available that simplify the process and require minimal technical expertise.
- How can digitizing my retail business improve customer experience?
Digitizing your retail business allows customers to shop online, access product information, and make purchases conveniently from anywhere. It also enables personalized marketing, targeted promotions, and better customer support through various digital channels.
- Should I digitize my retail business all at once or gradually?
The approach to digitizing your retail business depends on various factors such as budget, resources, and time constraints. While some businesses prefer a gradual approach to minimize disruptions, others may choose to implement changes simultaneously. Assess your specific needs and develop a strategy that suits your circumstances.