Digital transformation is affecting all aspects of our lives, but the retail sector is experiencing particularly severe turbulence at the moment.
This trend doesn’t necessarily mean that the high street is heading the way of the dinosaurs. However, the selection pressure on retail businesses is changing, and those that fail to adapt certainly face decline and even extinction.
Today you can research a product, compare prices, order and pay for it, and often have it delivered to your door the same day—all from an internet-connected computer or smartphone (and increasingly, simply by instructing your smart speaker to make the purchase). That’s why traditional retail businesses based on brick-and-mortar stores urgently need to update their business models for the Amazon age.
So will online ever become the dominant platform in the future of retail?
When thinking about this, we should pay careful attention to what kind of shopping we are talking about. If you think it’s all the same, think about your typical shopping experiences. There are many items you may enjoy purchasing, such as a car, an iPhone, ingredients for a special recipe, new furniture, or a special clothing item. But then there are items you don’t care for as much, such as toothpaste, generic spaghetti, or toilet paper.
In the first case, in-shop experience may speak louder, while the purchasing of items in the second case might be more prone to automation. In fact, this how the industry seems to be developing.
The ability to adapt, or drive future change, will be key.
This digital transformation will demand retailers, physical or digital, to adapt if they want to survive and prosper. In the end, it can depend tremendously on the type of retailer in question or on the ingenuity of human minds in coming up with new ideas and solutions.