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Navigating the everchanging retail sector

Richard Austin, Business Development Manager at ScanSource explores how technology is changing the retail market for the better.

The digital economy is developing at a startling rate and affecting every sector. The retail sector has been disrupted drastically in the last five years due to the advanced online environment which is bringing new retail solutions to the sector. With retail giants upping the stakes as they focus on staying relevant, it is important to ask whether human interaction is still important.

The assumption is that technologies, such as artificial intelligence, are disrupting the retail environment and introducing an all-virtual retail world. In fact, success relies on striking a balance between the two and ensuring a seamless transaction from online to offline.

Convenience is the answer

Today convenience is key for customers with consumers looking for a quick and easy option. Self-service has become increasingly developed in the retail sector with self-checkouts and self-service kiosks becoming common in not only the big four supermarkets in the UK but also in local convenience stores and increasingly in the non-food sector also.

Self-service has become the norm for many shoppers and the clear benefit of this is efficiency. Consumers no longer need to rely on a human to scan their purchases, they can have a much faster checkout experience by completing their shop themselves. However, there is still a long way to go, and simple processes such as checking ID for an alcoholic purchase requires the intervention of a human employee for final sign off, demonstrating that a balance between digital and traditional is required.

Payment becomes mobile

We are also seeing an increase in the use of mobile and tablet POS, as the retail sector advances their digital offerings at a rapid rate. Mobile payment has revolutionised shoppers’ buying patterns as typical consumers are using their smartphones to make purchases while on the go.  This has developed due to customers demand for convenience, speed and flexibility in every aspect of their lives, enabling retailers to gather an increased volume of data on their customers, which they can use to personalise their experience in store.

With customer loyalty ever more difficult to secure in the longer term, retailers need to rely on the data provided by these digital advancements. It offers retailers an insight into their customer’s shopping habits and favourite items, meaning they can provide a targeted offering for each customer.

It is worth bearing in mind that although mobile and tablet POS is becoming a driving force, traditional point-of-sale systems, including hardware such as cash drawers are still an important addition to a store. It is unlikely that payment by cash would become completely invalid and so resellers need to make their customers aware that they should be using both methods to appease all of their customers.

Mobile has become the preferred method to shop, meaning retailers can engage users via smartphone and tablet tech, customising adverts to fit these spaces. Having smarter payment methods, such as contactless card payments, can offer great benefits to a store.

Inventory gets smarter

There is a clear focus on new technologies at the front of stores, but a similar digital evolution is taking place in the back rooms. Radio-frequency identification (RFID) is a smart labelling system;  by using this tag, retailers are able to view every product in the storeroom on a screen without having to hand search, improving the efficiency of inventory management vastly.

This is a trend which is only going to grow as retailers test out the extent of the product. It could even be used to eliminate the issues with depo, for example, in store a retailer will be able to check the local stores for any items, without having to ship it from depo, creating a hassle-free process.

Staying ahead of the curve

Each store within the retail sector will have different needs, so resellers should focus on learning the field and knowing what technologies are expanding in those spaces. There should be an ongoing channel of communication between resellers and their customers.

With augmented reality becoming more popular, shopping will become more of an immersive and interactive experience as opposed to just buying a product. The lines will blur between online and offline channel, leading retailers to provide a sensory experience for their customers with the expectation they may make their purchases once back home.

With data exploding, physical stores will become viewed as window shopping whilst the actual sales will increasingly take place online and back at homes. With this in mind, physical stores will need to continually progress in the current digital climate.