Increasingly digitally aware customers and innovative competitors are presenting retailers with ever-greater challenges. In its whitepaper ‘The Future of Retail’, Deloitte Digital examines the effects of digital transformation on this sector and sees a massive need for action on the part of retailers: Only by focussing on their customers and offering them a great shopping experience will they be able to meet rising customer expectations in the future. There still seems to be a long way to go.
The new digital customer
The retail trade in Germany is facing a massive disruption that will fundamentally change the nature of the industry. Two factors will play a decisive role in determining who will be among the winners in this transformation: Firstly, new digital customers – especially millennials born around the year 2000 – are constantly connected, are well aware of their needs and wants and demand a great shopping experience. These requirements will soon become the norm, especially as millennials are steadily becoming the main customer group with increasingly strong purchasing power.
The new face of competition
The second factor that will significantly change the future of today’s retail trade is the new face of competition. In future, retailers will not only be threatened by their traditional competitors, but also by a glut of young and agile companies that are entering the market in increasing numbers. These companies not only embrace digital technologies and current trends to provide innovative solutions for the retail sector, they also put the customer at the centre of everything they do, and give customer utility priority over one-off sales.
The future of retailing
In view of these inevitable changes, Deloitte Digital has compiled 11 predictions in its whitepaper ‘The Future of Retail’, which offer retailers in all segments insights into the future. The report highlights issues such as personalised products and services, customer contextualisation, ecosystem inventory, content marketing, social media and the future experience in bricks-and-mortar retailing. Important questions for companies in terms of their own business model are raised, as well as possible solutions and examples for subsequent implementation.
The way to success
It is essential for retailers to identify who their customers are, what they really want, how their offering outperforms the competition and whether this makes a decisive difference from the customer’s point of view. Nobody can be great at everything but it is vitally important for companies to know the areas where they can ultimately inspire their customers. This knowledge of their own strengths paired with agility and speed of execution are the key to success. Digital technologies develop extremely rapidly and are no respecter of traditional viewpoints or constraints caused by annual business plans prepared long in advance. It is vital to set the course now for a successful future – and this whitepaper is certainly a first step in the right direction.
The future of retailing – 11 Predictions
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