How Technology is Improving Retail Business
The online retail is flourishing globally, with annual sales exceeding $2.4 trillion. By the end of this year, worldwide retail tech spending will increase 3.6 per cent to $203.6 billion, according to global research and advisory firm Gartner. Clearly, online buying is no passing fad. It’s a growing market shift retailers must embrace if they want to survive. Speed, agility and efficiency are expected of today’s retail businesses.
One of the key requirements to create a successful retail company is to reach the right individuals, at the right moment. Free shipping and returns policies, for instance, help retail companies see more customers. Reports show that although online sales account for around 10 per cent of total commerce, it will grow to 24 per cent of total sales by 2027.
The Main Driver
Perhaps one of the biggest drivers of online retail is technology.
Ankiti Bose, the co-founder and chief executive of Zilingo, a Singapore-based fashion platform with a valuation approaching $1 billion, agrees technology has been instrumental in the growth of the market. “It has also helped bridge the gap between a brand and its consumer,” she says.
Small wonder then, retailers across the world are pumping more money in technology at a time when many firms are looking at growing their mobile operations. In a 2018 study by VoucherCodes, one of the UK’s biggest voucher code websites, and market research firm WBR Insights, 75 per cent of senior retail executives from the UK and France intend to invest heavily in developing mobile apps, coupons and payments. Similarly, new technology and mobile technology are the most cited areas for in-store budget increases, according to a US survey by Retail TouchPoints.
In the Asia-Pacific region, on the other hand, digital transformation of the retail industry is redefining customer experiences and improving revenue. Microsoft Asia’s “Unlocking the Economic Impact of Digital Transformation in Asia Pacific” study, which polled 240 business leaders from the retail industry in the region, found that half of the respondents in 2019 will focus on transforming customer service and support as part of their digital transformation journey to deliver customer-centric offerings.
More significantly, the study predicts that the retail industry is expected to add US$272 billion to the region’s GDP, or 1.5 per cent CAGR by 2021, should organizations completely embrace digital transformation initiatives.