Digitalization in Retail Industry

Digital Transformation of the Retail Industry

With new technologies, changing shopping trends, increasing competition and customer expectations, digitalization projects in the retail sector have recently become essential. The need of improving the customer experience and increasing the efficiency of operations can be accomplished through digitalization.

Increasing the competitiveness and developing new business models has become a necessity rather than innovation. Companies in the retail sector, which is a very dynamic sector, turn to technological investments to maintain their existence. Companies that adapt to digital transformation at the required rate and speed are one step ahead of the competition. Businesses acting fast and agile in competition, which is the undeniable reality of today's business world, are ahead in this race by getting stronger.

While companies began to look for ways to overcome the increasing pressures created by the competitive environment, consumers' trends regarding their purchasing behavior also changed in this process. It rushes the prominence of issues such as customer relationship management, contactless-mobile payment systems, e-commerce, unmanned safe, internet of things (IoT) and digital marketing and accelerates companies' investments in this field.

Retail Industry in the World

In their research regarding retail industry and the digitization turn, Turkey PwC and Deloitte technology reveal a new industry profile. Despite being one of the most basic industries, the retail industry is constantly renewing itself in order to appeal to its customers, whose expectations are increasing and changing with digital solutions.
This industry has an average growth of 3% every year.
On average 60% of the sector is traditional retail and 40% is organized retail.
The digitalization index of the retail industry is also remarkable. Among the 18 sectors that were analyzed in Accenture's Digitalization Index study, the retail industry ranks first.
According to the Accenture research, the most important issue of 38 percent of the retailers is to automate what needs to be done and the decisions that need to be taken by the personnel during the day, thus reducing costs and increasing efficiency. Therefore, the use of data-based smart automation and optimization in the supply chain will prove to be highly relevant.

The Added Value of Digitalization in the Operational Process

Digitalization of operations; when we present it as systematization / improvement of processes and monitoring with advanced performance metrics, we see that it is an approach that has been constantly on the agenda of all sectors for the last 30 years and its origins date back to Ford's lean production. On the other side, when we say operation digitalization nowadays, what comes to our minds is that new technology inventions are coming to light that make us redefine the things that we know like Artificial Intelligence, IoT, Blockchain.

Many global retail companies have started using Blockchain and IoT technology, especially in their supply chain and storage systems. When we evaluate the developments in the retail sector, the prime investments are in innovating the digitalization of processes and organizational structure in order to strengthen digital structures. Ultimately, retailers have the opportunity to get to know their customers much more closely thanks to their integrated customer management capabilities. Thus, Industry 4.0 enables the advertising and marketing ecosystem to grow, and with the increasing use of sensors, the power of mobile channels and their importance in our daily lives are once again shown.

To summarize, we enter a different world of consumption with the development of technology and the homogeneous spread of information. Essentially, the retail industry is among the sectors most affected by this change. Looking at global examples and industry- consumer trends, we anticipate that tomorrow's retailers will have much more service- oriented and customer-centered digital business models. Companies can achieve this digital transformation adventure only with the most accurate and optimized solutions under the management of digital leaders.