The Future of Retail
Deloitte Greece, on behalf of the Digital Transformation Observatory of the Hellenic Federation of Enterprises (SEV), analyzes the Future of Retail in the new digital era.
The new digital era we are in is unlike any other era humanity has seen before, as the rate of change is faster than ever. The decreasing cost of available technologies creates not only significant opportunities that have to be exploited, but also threats, as sectors’ traditional boundaries become blurred, thus creating more competitive pressure for companies in every sector. The significant decrease in the cost of computing power, data storage, broadband services and other technologies lead to an exponential rate of change, which exceeds the limits of every sector and geography, while creating opportunities and disruption in many sectors, including that of retail trade.
The main driver of digital disruption in the retail sector are consumers, who are more informed than ever, something that makes them more demanding. Today’s consumers expect that companies know them personally and demand personalized products and services, as well as a unique buying experience.
In order to cope with this new reality, retail companies take initiatives such as: a) connecting with their customers, b) developing connected/smart stores and c) developing connected supply chain networks, for the ultimate benefit of the client, who needs to be in the center of their activities.
Connection with clients
Connection with clients is achieved by integrating the principle of customer-centricity in every function of the company. Understanding customers deeply, with the assistance of analytics and algorithms that analyze their buying behavior, is the necessary condition for providing a personalized and differentiated experience, while it allows the provision of a holistic experience to the consumer through each sales channel (in both digital and physical touchpoints).
Development of Connected/Smart Stores
Through “smart” stores retail companies have the possibility to enhance their interactions with their clients in the store (e.g. through digital kiosks and digital signage), while functions such as stock replenishment on shelves, price tag labelling, footfall monitoring, while the check-out and payment process become quicker and easier with the assistance of digital technologies.
Development of Connected Supply Chain Networks
Finally, retail companies leave behind the traditional linear supply chain model and move towards a new, dynamic, connected system, in which all partners/participants can interact for the exchange of goods, services and data/information, in order to ensure visibility across the entire chain and to support fast decision making.
The development of capabilities across the three aforementioned pillars characterize “Connected Retailers”. Moreover, these companies are characterized by the fact that they have developed a digital strategy that is aligned with the company’s overall strategy, while avoiding “random” actions, intentions and projects that are not within the strategic plan (“random acts of digital”).