30% of retailers say they increased their IT budget by more than 5%
The typical retail shopping experience isn’t what it used to be. Advancements are churning out of the IT industry at a pace that makes it difficult for retail to keep up. To match this increase, retailers are putting more into their IT budgets. Thirty percent of retailers say that they increased their IT budget by more than five percent—an adjustment necessary for staying competitive and moving forward in the industry. A recent Retail Systems Research (RSR) report found that 72% of surveyed retailers were reportedly in the process of working on projects related to IT. Putting new technologies into effect not only requires a strategical change, but a structural change—of a retailer’s entire organization, people, processes, culture, and business as a whole. But the most important change comes in the mindset, where new ways of thinking comprise the component that truly breeds transformation.
While customer needs and overall business methodologies are factors that have contributed to changing the face of retail, technology has been the impetus with the most noticeable effects. Retailers were once confined to the “sales box,” in terms of the services they provide, but now they have become much more progressive—as their area of work spans beyond store walls and e-commerce boundaries, seeping into the technology segment while becoming creators and innovative thinkers in their own right. Many elements are pushing retailers to change virtually every facet of their businesses to bring them up to speed with future trends and assume the identity of a digitally driven apparatus.
The essence of the conventional customer retail experience was centered on the ability to demonstrate functionality across all touchpoints, emphasizing the customer’s in-store journey. In the future, the customer will encounter individualized experiences tailored to his or her specific buying habits or shopping preferences, delivered through a combination of multiple technologies in stores. For example, behavioral analytics can be utilized to look deeply into customer preferences as well as aid in delivering personalized promotions, coupons, and offers on mobile phones. Smart displays and kiosks will also play a paramount role in reshaping the customer experience for the digital era, and store associates will be empowered through new digital skills and deeper insights derived from customers. Traditional store layouts and visual merchandising won’t hold as much significance as they once did, as the store of the future will contain virtual, 3D fitting rooms, augmented reality, and more. The manner through which sales associates serve customers will also experience a substantial change, aligning with constantly fluctuating customer behavior. Overall, the approach through which retailers address the customer experience will center on proactivity as opposed to reactivity—actively anticipating and preparing for future transitions in the customer experience instead of taking action only after a change occurs, catering to customers through every channel of their shopping journey.
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