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The retail sector is making the leap to digitalization


Smart Retail Technology is booming like never before: Shopping as a personal experience and buying at a distance.

During the Corona crisis, supermarkets and shops need to implement preventive measures to protect customers and staff. Cashless payment, digital entrance controls that measure customer flows, and self-checkouts are designed to prevent the virus from spreading further.

In the current situation, the retail industry is experiencing an enormous boom in innovations. At the same time, stationary retail is increasingly focusing on a special shopping experience and improved services to score against the growing competition of e-commerce.

All of these developments are making the retail technology sector extremely exciting right now. One thing is certain: digitization in the trading sector is advancing at a tremendous rate and is on the verge of radical reinvention.

Retail technologies have never been so popular

Crises are considered as the biggest boost for innovation. Regardless of the current situation, many retailers are currently in the process of digitalizing their business. It is important to digitally map and, if possible, deepen the relationship with their customers.

From wearables to digital signage players to large POS displays to mobile applications – there are numerous examples. The solutions united under the term, retail technology, have one thing in common: they are designed to help deepen the relationship with the shopper, increase their shopping experience, and strengthen their loyalty to your brand. Among the benefits for the consumer, convenience is the top priority.

Benefits can be the immediate delivery of the product, AI-supported, personal product recommendations based on the customer’s history and also augmented and virtual reality applications that simplify the product decision, such as the search for the right furniture or the selection of lipstick.

Especially in the fashion business, technological breakthroughs are taking place: The multi-brand store, Luisa Via Roma, for example, recently launched an e-gaming application. Customers can dress an avatar in luxury fashion and then shop in the webshop on their own.

In Hamburg-Altona, C&A Europe recently opened its most modern store with tech features such as self-checkout and an individualization service in the denim department.

The fashion retailer, Orsay, in turn, organized online shopping for the first time with the help of a live stream. While an influencer hosted live from the store, employees answered questions in a live chat.

Networking, networking, networking

Fashion stores are currently upgrading: they are not only connecting their shops with the Internet, but also mirrors, labels, and clothing. The various touchpoints are linked to each other via data exchange through ERP and PIM (Product Information Management) systems.

The big goal: all customer, product, company and price data should be available synchronously. The customer can add products to the shopping cart in the online shop, retrieve the products later in stationary retail via the POS system, modify the shopping cart, and complete the final purchase.

Another scenario is that the customer enters the store and his or her cell phone automatically connects to the displayed products via Bluetooth or Near Field Communication (NFC) based on RFID.

Product information such as manufacturing, recommendations on other articles, or sales promotions, is directly displayed on the smartphone. News and trends like these are essential for the digital transformation in retail and enable a completely new digital customer experience at the point of sale.

Bonprix, winner of this year’s reta award of the EHI Retail Institute in the category “Best Customer Experience”, successfully combines the advantages of the online and offline world in its app, “fashion connect”. The selected clothes are scanned with a smartphone, the size is chosen and the changing room reserved, where the goods are then ready for fitting. The payment options integrated into the app allow the selected items to be paid quickly and easily. The app can be integrated seamlessly into the SAP system of Bonprix and works in real-time with all other in-store technologies.

China, undisputed pioneer in the retail sector

China, the unchallenged pioneer in the retail sector, has been successfully demonstrating since 2016 how stationary retail and online merge into a unique shopping experience.

With the “New Retail” concept, China is making impressive use of all the possibilities offered by digitalization to meet customer needs quickly and comprehensively. Online, offline, logistics, and technology are integrated into a single value chain.

This is being accompanied by the fact that China is developing into a so-called cashless society. Usually, the smartphone and QR codes are used to pay via the common payment apps such as WeChat Pay or AliPay – or via face recognition, for example, in the Alibaba supermarket, Hema/Fresh Hippo.

For consumers, this is extremely simple, fast, and convenient. But mobile payment and its various variants are also becoming increasingly popular in Germany.

Contactless through the crisis

Practical, fast, and above all, hygienic – contactless payment is becoming more and more widespread and is more popular than ever in Corona times, according to the Deutsche Bundesbank.

In 2018, for the first time, more people in Germany paid with cards instead of cash. Today, it is almost a matter of routine to make purchases without cash, and using a smartphone at the checkout is also becoming part of everyday life.

H&M now offers smartphone-supported purchases on account in stationery stores. This is made possible by the fashion company’s loyalty app. Decathlon goes one step further: the new self-checkout service enables completely contactless shopping in selected stores – without a cash register, terminal, or staff.

Scanning and payment is done via smartphone, with RFID article surveillance automatically deactivated. The prerequisite for using the new payment service, known as Scan & Go, is a membership in the MyDecathlon program – customer loyalty par excellence!

Not only online but also offline: the future lies in AI

Artificial intelligence (AI) as the key to personalization is considered the most important trend for the future of retail. The technology ensures that retailers can better understand data and provide customers with tailor-made offers.

In e-commerce, where maximum personalization can be observed as a new platform strategy, AI will have the greatest impact on the future of online commerce over the next five years, according to a survey by e-commerce software provider, Divante, and the Kantar market research institute.

But, AI is also experiencing a boost in the retail landscape: Based on their online experience, customers, particularly younger shoppers, expect to receive an individually tailored offer, similar to online shopping. Other applications also show that AI is a motor for higher customer satisfaction: with the help of an algorithm, MediaMarktSaturn has analyzed the sales history and, on this basis, the demand patterns and sales correlations of consumers for each store.

This knowledge was used to optimize product stocks in the stores and improve the presentation of goods. An app informs the store managers about slow sellers and provides suggestions for solutions. This increase in efficiency through the implementation of new technologies was rewarded with the reta award 2020.

New times drive new technologies 

Covid-19 will not only boost digitization on the manufacturer and retailer side, but will also increase the shopper acceptance of new technologies. The Corona crisis will change consumer behavior permanently.

One of the central results of the current Consumer Sentiment Pulse Check, a representative survey of more than 1,000 consumers in Germany by the management consultancy McKinsey, shows that consumers are sticking to their newly acquired behavioral patterns. 41 percent of those surveyed stated that they would continue to shop less, apart from food shopping, even after the crisis.

According to a survey by the Boston Consulting Group (BCG), consumers also want to continue to buy food online. E-commerce is also still very popular with other products.

Newly acquired habits and patterns of behavior will prevail beyond the crisis in the long term and drag on into everyday life, which indicates a growing, broad acceptance of new technological innovations among consumers.

In contrast to other industries, the digital economy could even emerge stronger from the crisis as it speeds up the digital transformation. At least 800 decision-makers from the digital industry who took part in a trend survey conducted by the Digital marketing exhibition & conference, Dmexco, expect this to happen.

About the Author

Helen Mack
Account Director at HBI Helga Bailey GmbH – International PR & MarCom

Account Director Helen Mack HBI

After a short excursion into marketing, Helen Mack has been serving HBI customers in the B2B sector for more than 15 years. Her current focus is on the exciting topics of sustainability, retail technology and logistics. In addition to consulting, her present tasks include text creation and event organization. Always in focus: how to increase the market presence and success of HBI’s clients.


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