There is no doubt that the last two years have been incredibly challenging for many of those operating in the retail industry. Intermittent lockdowns, enforced high street closures and reduced footfall meant that even the strongest of retail giants struggled. And just when we thought it was all over, the new Omicron strain has brought yet more uncertainty.
During this time of fresh hardship, the lessons learnt – and opportunities taken – during the pandemic must not be forgotten. As a whole, the industry has evolved faster than anyone could have expected but the journey is far from over. As we look forward into 2022, the retailers that embrace the challenge, get creative and adopt modern technologies in order to continue to deliver for their customers, are likely to be most successful.
We spoke to some industry experts to find out what they think next year will bring and how retailers can get ahead:
Tony Lorentzen, SVP and GM, Intelligent Engagement, Nuance says:
“Leading retailers have been personalising digital shopping experiences in one way or another for many years now—personalised product recommendations based on past purchases, for example, have been commonplace for a long time. In 2022, however, we’ll see a shift toward hyper-personalisation, where every interaction is relevant and based on real customer needs in that moment.
“This requires a complete understanding of each customer’s historical relationship and recent interactions with the brand, which means data from every channel will have to be aggregated and analysed by powerful AI solutions. That brings us back to the need for digital contact centers that merge previously siloed engagement channels and provide a layer of intelligence that can understand and predict customer needs in real time.”
Zarina Lam Stanford, CMO, Bazaarvoice says:
“Consumers are increasingly online and on social media, which is leading to a boom in social commerce. Brands and retailers are already prioritizing social commerce now and are only set to increase their social commerce efforts over the next few years. According to our research, 67% of brands and retailers say that social commerce is important to their online strategy today and 70% say it will be important to their online strategy in the next three years.
“As marketers, and as consumers, this will come as no surprise. Social commerce meets shoppers where they are, and inspires them to discover new products. In a consumer survey we ran earlier this year, 84% of consumers agreed or strongly agreed that their time on social media has increased significantly since the pandemic started. Almost three quarters (74%) of respondents said they agree or strongly agree that they find themselves more influenced to shop via social media now than they did pre-pandemic. A little more than a third (35%) said that before the pandemic they rarely shopped from social media channels, but since March 2020, 30% said they now often do.
“Brands and retailers need to ensure that they are enabling product discovery, serving consumers with the content they need to purchase, and engaging with them post purchase to create loyal advocates.”
Wayne Snyder, VP Retail Industry Strategy, Blue Yonder, says:
“The need to provide an efficient omni-experience was evident in 2021. Those retailers who were able to scale their online business thrived amid continued disruption and as we come out of the pandemic, creating the seamless experience between in-store and online is a must.
“Retailers are grappling to evaluate with the right network across a blend of large warehouses, smaller localised fulfilment centres and deliveries from stores. The need is for these to be inter-operable with intelligent decision-making as to how best to move products from anywhere to anywhere. With customer expectations continuing to rise and with new priorities such as sustainability coming to the fore, retailers must be able to respond efficiently to meet these needs in a profitable manner.
“To enable this, artificial intelligence (AI) is driving better forecasting and order decisions to ensure that products are at the right place to allow shoppers to buy from wherever, whenever. Robotics and IoT are driving efficiencies in the warehouse. Autonomous and electric vehicles will transform the last-mile, where visibility and tracking is key to enable more efficient deliveries and better communication with customers. These customers want to understand real-time availability and delivery options as they shop with same day delivery and pick-up options. This requires a seamless supply chain, involving AI tools analysing millions of data points in real-time to optimise efficiency and decision making. In 2022, the focus for retailers will be reaching this omnichannel nirvana.”
John Phillips, SVP at Zuora says:
“After years of living in fear of disruption from Amazon, retailers now understand the secret to competing with the retail powerhouse: embracing the end of ownership and doubling down on subscription membership models that offer a 360 view of the customer.
“In 2022, delivering (and innovating upon) a curated and flexible shopping experience — fueled by customer data — will become the only way to compete in the new age of retail. In order to capitalise on recent changes in consumer behaviour and come out on top, retailers will need to focus on adding true value and improving the overall experience for subscribers.
“This means ensuring the right blend of flexibility, convenience and customisation through subscription-based models has never been more important. Nor has determining a balanced pricing strategy, based on an understanding of how your customer values your offering. These are the areas that are likely to set your retailers apart and encourage that coveted brand loyalty long-term.”
John Smith, EMEA CTO, Veracode, says:
“Retail businesses face the dual pressure of being high value targets for attackers while also requiring software that allows them to be highly responsive to customers and compliant with industry regulations. Going into this holiday season, retailers can take a number of steps to tighten their cybersecurity measures and protect themselves and their customers.
“Web application attacks are the primary method for cybersecurity incidents in the retail sector, with personal or payment data exploited in about half of all breaches (2020 Verizon Data Breach Investigations Report.) To minimise risk, retailers should continually review and adapt their web security accordingly. Ways to improve include instilling secure coding practices from the outset, scanning applications regularly for flaws, and updating software frequently as a matter of course.
“Our State of Software Security research also found that the industry has the second highest rate of high-severity application flaws (26%). Retailers should work with their developers to urgently address software application issues by using API-driven scanning and software composition analysis. Scanning for flaws in open source components offers the most opportunity for improvement in the sector.
“Last but not least, it is crucial for retailers to routinely back up their data and information so that they can return to business as usual if there is a ransomware attack. Developers can also reduce the risk of a credentials management attack by storing encrypted passwords in restricted locations and avoiding hard-coded credentials.”