An interview with Paula Macaggi, Head of Partnerships and Global Strategy at RETHINK Retail.
A complex discussion that will reveal how is technology shaping the industry now from an expert that strives to bridge gaps between international markets, cultivate new partnerships, and devise cutting-edge strategies to enhance the efficiency and sustainability of the retail industry.
What are the key features that will define the shopping experience in 2023?
In 2023, the shopping experience will be defined by three major trends that are set to transform the retail landscape.
Firstly, there is the rise of in-store retail media, which will be enabled by emerging technologies that provide retailers with better insights into customer behavior in physical locations. This will allow retailers to offer more personalized experiences and monetize first-party data with margins as high as 80%.
Secondly, sustainability will be a key feature of the shopping experience, as consumers become more conscious of the environmental impact of their shopping habits. Retailers that prioritize sustainability in their operations and products will likely see greater success.
Finally, the biggest shift in the shopping experience will be driven by the use of generative AI, which will completely transform the way consumers interact with brands and products. This will enable shoppers to choose items based on cause, occasion, feeling, and even temperature. The adoption of such technologies is likely to catalyze changes in the retail landscape that will be game-changing, even for those who are currently unaware of their existence.
What boxes do you have to check to have a sustainable but profitable retail business?
To have a sustainable and profitable retail business, there are several key boxes that must be checked.
Firstly, it's important to ensure that operations are running efficiently, as this can have a significant impact on the environment. Adopting digital inventory management systems is one way to track inventory levels, reduce waste, and optimize stock levels, which can minimize the environmental impact of overproduction, stockpiling, and spoilage.
Additionally, retailers can opt for energy-efficient lighting and cooling systems to reduce their energy consumption and greenhouse gas emissions. Offering digital receipts is another option that can reduce paper waste and provide a more convenient and efficient way to track purchases.
Another important box to check is the use of renewable energy sources like solar or wind power. By reducing their reliance on fossil fuels, retailers can lower their carbon footprint and make a positive impact on the environment. In addition to being sustainable, these alternatives can also help retailers save money on their energy bills.
Finally, it's worth noting that prioritizing sustainability can also have a positive impact on a retailer's brand and customer base. As consumers become more environmentally conscious, they are increasingly seeking out businesses that share their values. By checking these boxes and implementing sustainable practices, retailers can both save money and become more attractive to eco-conscious consumers, thereby ensuring that their business remains profitable in the long term.
What are the latest retail technologies, and how do they apply to our reality now?
Retail technology is rapidly evolving, and there are several cutting-edge technologies that are currently making waves in the industry. One of the most notable technologies is AI, which has been a part of many retailers' and consumers' lives for several years. However, with the recent launch of ChatGPT, AI has become an even more trendy topic in the industry. It has the ability to provide tailored service to customers and help develop new products and recipes for different brands.
One of my personal favorite AI features is computer vision, which has the potential to provide a better checkout experience for shoppers while giving retailers a deeper understanding of their customers' shopping behavior. By using computer vision, retailers can personalize each shopping experience, making it more tailored to the individual customer.
Other notable retail technologies include RFID (radio-frequency identification), which allows for accurate inventory tracking and real-time monitoring of stock levels, and mobile point-of-sale systems, which provide a more convenient and efficient checkout experience. Additionally, virtual and augmented reality technologies are becoming increasingly popular, allowing retailers to create immersive shopping experiences that blur the lines between physical and digital shopping.
How should retail businesses prepare for the recession and overcome it?
Retail businesses must prepare for a recession by being proactive and strategic in their approach. During times of financial insecurity, consumers tend to make fewer impulsive purchases and become more conscious of their spending habits. This presents an opportunity for retailers to show that they care and to build loyalty with their customers.
According to recent consumer research by Capgemini, 78% of consumers will be more loyal to companies that help them during difficult times. Therefore, it is crucial for retailers to focus on building strong relationships with their customers and providing them with value-added services that can help them during a recession. One effective strategy is to launch or enhance loyalty programs, which historically have seen a boom in adoption during times of economic downturns.
In addition to loyalty programs, retailers should also consider streamlining their operations and finding ways to cut costs without sacrificing quality. This could include renegotiating contracts with suppliers, reducing unnecessary overhead expenses, and optimizing inventory management to minimize waste and reduce inventory costs.
Finally, it's worth noting that retailers should also be prepared to adapt to changing consumer behavior and preferences during a recession. This could include offering more affordable or value-driven products, as well as exploring new sales channels such as e-commerce or social media platforms
Overall, the key to overcoming a recession in retail is to be proactive, strategic, and customer-centric. By focusing on building strong relationships with customers, streamlining operations, and adapting to changing market conditions, retailers can position themselves for success in the long term.
"Happy and well-trained staff can have a significant impact on customer satisfaction."
If you were to give a piece of advice to any retail business right now, what would that be?
My advice to any retail business right now would be to stay up to date with the latest technologies and solutions that can enhance the customer experience. The retail industry is constantly evolving, and new technologies can provide innovative solutions to old problems. By staying informed and investing in the right technologies, retailers can differentiate themselves from their competitors and provide a better overall experience for their customers.
Additionally, it's crucial for retail businesses to prioritize their employees and focus on creating a positive work environment. Happy and well-trained staff can have a significant impact on customer satisfaction and can help to create a culture of excellence within the business. Providing ongoing training, mentorship, and support can help to improve employee morale, reduce turnover, and ultimately drive business success.
Overall, my advice to any retail business would be to focus on innovation and customer experience, while also prioritizing their employees. By investing in the right technologies and creating a positive work environment, retail businesses can set themselves up for success in today's rapidly evolving marketplace.
See Paula on the stage at Future Retail Summit 2023, talking about the evolution of retail, with focus on opportunities for growth.
Tickets & Agenda here: https://www.techweek.ro/business-summits