By Reapp, the world-class suite of bespoke software apps, created by Dee Set Group, that help brands and retailers sell more
Over the past few years, there has been a seismic shift across the retail sector. There is an argument to say the changes which were accelerated during COVID were in play pre-pandemic – but the inflation pressures alongside the rise in cost of living has created a cocktail of disruption which has put the consumer and retailers under pressure.
Consumers have become incredibly savvy. Most people are driven by cost – so they research prices which in turn means brand loyalty has gone. The idea that a mum would always shop once a week with the same retailer has been eroded. The squeeze on household budgets also means consumers are having be very careful on what they are spending. With apps and online stores – the consumers are now able to shop around to get better deals. This reduction in brand loyalty puts more pressure on retailers to give the customers what they want when they want.
As the consumer has become more agile with their shopping habits, so has the future projections for what retail will look like. The three- or five-year business planning is dead. Who five years ago would have accurately predicted the shape of the retail sector today?
People are shopping more local due to hybrid working and less of a commute to a central workplace. As a result, we are seeing grocers really trying to push their local models. Consumers are also turning more to online grocery shopping – it is now very easy to choose products, checking out with their phone and have the weekly shop delivered to their kitchen door.
With consumer behaviours and trends tracked in real time- more than ever the future of retail is about agility. Brands and retailers must adapt to trends very quickly and have the agility within their organisation to support the change.
To help support this need for agility, we are seeing more retailers and brands use data alongside an innovation mindset within their entire organisation. Having access to real time data – alongside a team of people that can respond and adapt in the quickest way – will be essential for retailers and brands who want to be market leaders.
Data with agility can absolutely increase product sales. POS has traditionally been very much about printed signs – whether on the store window or around the store. Now, with digital signage – when the weather drops to a certain temperature the signs will advertise hot drinks – and when it goes to the other extreme the advertising boards will switch to advertising summer clothing. The ability for data and technology to work together to be that agile and quick is already being introduced into the retail sector.
Whilst embracing technology to support agility, we must also be aware of what the customer will tolerate. There has been some experimentation with almost Star Wars looking robots going down aisles taking photographs – customers hated this level of tech in their shopping space from a privacy perspective – so it was abandoned as it was inefficient to run outside of store hours.
Retailers and brands are also very aware of marrying up the use of data and technology, alongside sustainability. Agility will only be beneficial if efficiency and sustainability are also considered – to give the customers a better outcome.
We can track the changes we are seeing now in the retail sector back to the invention of the internet. The availability of information and rise in technology has come hand in hand which has now increased expectations enabling businesses to operate in a different way.
What is certain is that it won’t be possible to succeed in the future of retail as a mediocre business. The ones that will thrive (and not just survive) will be those who not just focus relentlessly on what their customer wants but also includes them in the design process of any innovation, establishes a strong feedback loop, and whose organisational design is set up in a way that is agile enough to respond quickly to the changes that are required to their business model.