With the development of technology, the digitalization of retail has reached incredible scales. The global retail digital transformation market was valued at $143.55 billion in 2020 and is expected to be worth $388.51 billion in 2026 (data of Digital Transformation Market in Retail). Companies offer grocery delivery services, personalized promotions, and even virtual shopping trips. In this article, we will talk about the main trends in retail digitalization.
Why do we need digital transformation?
The uprise of modern technologies in retail is a win-win situation for everyone. The business gets new customers and the customer gets an improved shopping experience. By 2023, the 50% of retailers who embrace technology are expected to see a 35% increase in net income and a 10% increase in customer loyalty.
Today’s shoppers want a personalized experience. They understand that brands collect information and want a completely personalized experience in return. Individual offers, promotions, discounts are one of the main tools of a modern retailer. It is possible to provide such a high level of service only with the help of a total Digital transformation.
The sharp drop in offline retail sales in April 2021 due to the spread of COVID-19 is now a thing of the past as sales have been steadily recovering. Now is a great time for digital transformation, as consumers have been unable to leave their homes for long periods of time and have been mainly shopping for essentials.
Large trading companies have already begun to gain market share using the pandemic as an opportunity to innovate and attract customers. Brands need to keep up with their existing digital transformation strategy, as future profits will surely cover the losses of 2020.
The main habit that will stay with us forever is online shopping. According to Statista, the research center, 75% of respondents make online purchases at least once a month. To do this, companies create modern online stores and delivery services. Virtual shopping is based on a simple idea: to attract people to the ideas of Digital transformation. The result is a true omnichannel experience that seamlessly blends the boundaries between online and offline trading. An employee working in a store can instantly connect via text, chat or video to a shopper browsing catalogs from home. Thanks to this real-time connection, customers can get sales advice even without actually going to the store.
Not all stores can afford such technologies due to the high cost, but some large retailers are already offering a unique experience. In 2016, eBay launched the world’s first virtual reality store. To create it, the company collaborated with the Australian retailer Myer. Users can view over 12,500 properties, and item prices are updated in real time.
Food delivery services have long been popular in major cities. According to an OMI study, about 65% of city dwellers use them on a regular basis. Usually couriers deliver products quickly and on time, because they use their own vehicle. A car, a bicycle, a scooter are the main weapons of any delivery man. Yandex, transnational IT-corporation, has come up with an even more convenient way to quickly bring food. A courier is a small unmanned robot that can carry up to 20 kilograms. So far, the technology is available only in a few districts of Moscow.
Smart coffee shops
Today, people drink several cups of different coffee varieties a day. Coffee barista robots are one of the latest forms of machines in the world of automation. They cook more efficiently than humans by minimizing errors. Barista robots allow you to optimize the coffee shop workflow: the machine remembers the order, fixes the payment, and always prepares coffee perfectly.
There are many similar coffee shops in the USA. Cafe X is a Californian company founded in 2015. It developed a robot that sits inside an aquarium-like kiosk. Orders can be placed by interacting with the machine through an interactive tablet. The barista robot uses a six-axis “arm” to perform operations and with great precision it makes about 120 cups of coffee per hour.
Such technologies already exist in several other countries. Basically, “smart” coffee machines are located in office buildings and are complemented by “smart refrigerators” with ready-made food – it turns out a full-fledged replacement for a cafe. Since the beginning of 2021, demand for them has grown by 40%. This is due to the massive return of people to offices, as well as the closure of many cafes near offices that did not survive the “second wave”.
In the future, the entire retail sector will gradually be replaced by robots. They work clearly according to the instructions, which will minimize potential losses. The main thing is to set the correct settings. As soon as company owners understand the effectiveness of barista robots, the amount of such outlets will rise.
Robots in stores
The largest American online store Amazon has an army of robots in warehouses. Now their number is estimated at 45,000 pieces. The average client does not see robots at work, and most likely does not even know about this technology. This is due to the fact that so far only a few companies are testing assistant robots on the trading floor.
Household goods retailer Lowe’s introduced the LoweBot back in 2016 in San Francisco stores. Shoppers can ask for LoweBot via voice or touch screen. The robot will help you find the product, check its availability in the warehouse, and ask you to take it to the hall. Customers can also ask the robot some basic service questions that would otherwise need to be addressed to a human worker. The robot fully replaces the sales assistant. It travels through the strip malls, sorts goods, communicates with customers.
That same year, Simple Robotis developed Tally. The robot specializes in monitoring the level of stocks and prices of goods in stores. Tally uses software to visually recognize if the price is correct and if the item is on the shelf.
In the coming years, the entire retail industry will undergo a digital transformation. Many customers of millennials and zoomers generation will practically stop going to offline stores, and only robots will do the work in warehouses. To keep up with the trends, we have prepared a checklist of future digital innovations in global retail: online sales, personalized offers, mobile applications; full or partial replacement of employees by robots; use of virtual and augmented reality.
Some of the innovations from this list are already in use in American stores but will soon reach the markets worldwide. The digital transformation of retail is rapidly developing, and it is quite possible that new technologies which we do not yet know about are being tested in the laboratories right now.