Alex Rutter, UKI director, retail, Google Cloud, offers his top retail predictions for 2022
- There will be no going back from the “store of the future”
“Over the last two years, retail has embraced digital solutions more than any other industry. With the sudden closure of the high street and subsequent shift to ecommerce, the sector was forced to pursue an accelerated digital transformation, and with 80% of new customers now engaging with digital touchpoints on their shopping journey, retail isn’t going back to the way it was.
In combining lessons from the pandemic with tried and tested retail strategies, leading brands have been able to merge the worlds of online and physical retail to offer customers the best of both. This means delivering enhanced customer experiences combining the emotional connection of in-store with the convenience of online. Mobile purchasing, checkout-free stores, same-day delivery and in-store pickup are just some of the customer benefits enabled by an omnichannel strategy, whilst seamless digital offers of this kind allow retailers greater visibility into customer behaviour, shopping preferences and product interest. In 2022, these strategies will continue to improve and expand; retailers will solidify the shift to omnichannel, and define the so-called “store of the future”.
2. Focus will move from customer to company personalisation
“There is no business more customer-focused than retail, and so it’s no surprise that the sector has embraced digital technology to better understand what their customers want. In 2022, many retailers will come to realise that these now familiar personalisation solutions have value outside the customer-facing realm, and can be leveraged to tackle logistical and operational challenges too, such as disruptions facing the supply chain.
Supply chains are broken everywhere from manufacturing, to storage and shipment. On top of this, every company has a unique set of circumstances to contend with, tackling challenges with partners, inventories, store locations and more. In this environment, understanding how, for example, a particular supply chain disruption will affect customer delivery in two months is critical. Company personalisation enables visibility of things like local weather, time of delivery, and even an outlook for finding and recruiting new staff. The ability to understand oneself and one’s environment in this way enables retailers to look ahead and predict previously unforeseen challenges, empowering them to prepare with confidence.”
3. Data-led retail businesses will come out on top
“In retail, as in so many other sectors, the value of capturing and effectively managing data is nothing new. Many leading retailers are already addressing areas where there are clear metrics and opportunities to calculate return on investment, and we expect to see lots more of this in 2022.
“We’ve already seen how large-scale analytics, Machine Learning, and Artificial Intelligence can prove effective in areas like operational efficiency, deploying associates, and tracking inventory. For example, Google Cloud’s partnership with retail brand LVMH enabled the business to enhance demand forecasting and inventory optimisation, whilst simultaneously improving customer experiences through personalisation. In building up a good working understanding of their customer and company data next year, more retailers will be able to follow LMVH’s example. In doing so, they will be able to venture into new areas, encourage customers to engage in new ways, and develop a sharp enough profile of their activities to personalise and fully optimise their operations.”