The retail industry is rapidly evolving to meet changing consumer needs. According to Euromonitor International’s Voice of the Industry: Retail Survey (conducted in July 2023), 74% of industry experts believe that by 2023, shopping will be an experience that consumers can engage in anytime, anywhere, and on any platform. I believe we are moving towards a process that will allow us to do so. This shift has led to increased investment in digital customer experiences. However, retailers are also prioritizing enhancements to the in-store shopping journey, leading to innovation across online and offline channels.
Euromonitor International’s retail system tracks new concepts and other innovations across channels around the world. The new concepts being considered this year have five themes, three of which leverage technology. These three themes are new digital interfaces, simplified shopping, and data-driven retail.
new digital interface
Retailers and brands are leveraging new digital interfaces like social commerce, livestreaming, AR/VR, and the Metaverse to engage consumers online. These technologies enhance the online experience and offer innovative ways to transact that cater to the preferences of younger generations, including Gen Z.
Retailers have been exploring different solutions within the digital interface.
One in three retail industry professionals say their business enables consumers to purchase products through social media transactions.
Source: Euromonitor International Industry Voice: Retail Survey (July 2023)
Future investments will prioritize adding new transactional capabilities to social media, enhancing online consultations and further leveraging live streaming. These efforts reflect retailers’ recognition of the importance of connecting with consumers through engaging experiences. For example, Amazon introduced ‘Consult-a-Friend’ in October 2023, allowing users to solicit feedback on potential purchases from friends and family through their preferred social messaging app. did. Following the growing popularity of social media, TikTok introduced TikTok Shop in Vietnam in April 2023 to provide a platform for retailers, brands, and content creators to promote their products. Consumers can purchase featured items directly from live streaming videos on TikTok. Major brands such as Samsung and Unilever have expressed interest in this new platform.
simple shopping
Retailers are proactively streamlining the shopping experience by implementing frictionless checkout and fulfillment both online and in-store. Simplifying travel eliminates pain points, minimizes wait times, and improves customer satisfaction. In doing so, retailers create space to introduce new products and formats to meet consumer expectations for an intuitive, fun and efficient shopping experience.
57% of retail industry professionals said improving the customer experience is a strategic priority over the next 12 months.
Source: Euromonitor International Industry Voice: Retail Survey (July 2023)
Retailers are focusing on improving product visibility and assortment, both in-store and on digital platforms. This is especially important online, where endless choices can overwhelm consumers. Technology, and AI in particular, is key in simplifying the shopping experience by facilitating faster product discovery, ensuring timely price updates, and delivering personalized promotions such as coupons and loyalty-based discounts. playing a role. It is becoming increasingly important to personalize products based on personal preferences, such as past purchases and user profiles. Retailers like Walmart are capitalizing on this trend by leveraging AI-powered solutions to help shoppers find specific items based on prompts and automate reordering of previously purchased items. is at the forefront of
Advances in technology are simplifying the shopping experience for diverse consumer groups. In March 2023, his tech startup Inklusiv released an app that allows people with disabilities to shop at Danish businesses. The app features accessibility features, a map of business locations, and a searchable database of customer reviews. Users can also book customized shopping assistance trips.
data-driven retail
Retailers and brands are leveraging the potential of data, advanced algorithms, and AI to enhance both back-end operations and the customer experience. This includes improvements to inventory management, supply chain, pricing, marketing, and more.
Retailers are deploying AI technology to optimize operations and provide personalized experiences to consumers.
43% of retail professionals agree that AI will be the most influential technology in retail in 2023
Source: Euromonitor International Industry Voice: Retail Survey (July 2023)
As a result, the use of data has become essential for decision-making in the retail industry. AI-powered tools such as machine learning algorithms improve supply chain management and price optimization. ChatGPT and other AI technologies are driving innovation in the online shopping experience. As personalization becomes more intuitive and less cumbersome, more consumers are willing to share their personal data in order to receive personalized deals. According to Euromonitor International’s Voice of the Consumer: Lifestyle Survey, 37% were willing to share their data for this purpose in 2020, rising to 42% by 2024. This growing acceptance of personalized marketing strategies reflects consumers’ desire to optimize their purchases.
In 2023, data-driven innovations are transforming retail, impacting both front-end and back-end operations. His Oxxo, the retail arm of Mexican conglomerate FEMSA, partnered with Finnish technology company Relex to optimize the supply chain and retail planning across his 22,000 convenience stores. This software uses machine learning and AI to enhance operational forecasting, optimize supply chains, and implement customer-centric strategies. Alibaba’s Tmall has launched Wenwen, an AI-powered feature to assist merchants with copywriting, images, and customer service for China’s 11.11 shopping event. By November 2023, Wenwen has gained over 5 million users, facilitated 1.5 billion interactions, and helped consumers secure discounts for the best deals.
Looking to the future
Over the next five years, retail industry professionals will primarily focus on growth and expansion. As a result, 45% of businesses intend to prioritize investments in new technology during this period, according to Euromonitor International’s Voice of the Industry: Retail Survey, conducted in July 2023. Given the transformative impact of technology on retail in recent years, continued innovation in this space is expected to shape the future of the industry.
To dig deeper into retail innovation and explore related case studies, read our strategy briefing, New Concepts in Retail.
To further explore the impact of generative AI on retailer and brand operations, read our strategy briefing, Top 5 Digital Consumer Trends for 2024.
