Digital Transformation in Retail. Barriers and Challenges You Need To Keep In Mind.

According to the 2021 Retail Digital Transformation Survey, 61% of retailers plan to increase their investment in digital solutions in the next 12 months.

This not only signals the changing retail landscape but also shows that embarking on a digital transformation path is no longer an option. 

Buyers desire more than e-commerce apps and modern websites; they want omnichannel and innovative experience, personalization, immediacy, flexible payment options, self-service, and consistent brand value across all channels.

But retailers still face numerous challenges that prevent them from fully capitalizing on the benefits Digital Transformation can deliver to productivity, effective cost management, and seamless customer experience.

Let’s review some of the key digital transformation barriers and technology challenges in the retail industry and how your business can succeed in the ever-changing environment.

61% of retailers

plan to increase their investment in digital solutions in the next 12 months, according to the 2021 Retail Digital Transformation Survey


Technology Challenges in Retail Industry: That You Need to Know About

1. Not Having an Easy-To-Update E-commerce Platform

A modern and fully-functional e-commerce platform will empower your staff to serve your customers better, which is key to increasing sales.

However, many outdated and barebone e-commerce platforms limit what you can do with your online store. They don’t have easy-to-use workflows for authors, they don’t support intuitive dashboards, and buyers find it challenging to navigate the site due to complicated and obtrusive design.

As a retailer, your goal is to make the experience easy for both your staff and customers. The best foundation a business can have is a modern channel for your staff and customers to connect with, leveraging dynamic, clear, and relevant information. Not choosing the right e-commerce platform that enables your teams is a technology challenge in the retail industry that may not be clear until months after implementing a digital solution. 

For the sales team, you should ensure that the product information management is as straightforward as possible. Your employees should be able to manage listings with a breeze, whether we talk about uploading products in bulk, providing information, changing pictures, launching campaigns, or managing different product categories and departments.

Equally, buyers expect:

  • Simple, consistent and clear navigation bars;
  • Accurate and detailed product descriptions;
  • Up-to-date stock levels;
  • Personalized recommendations and offers;
  • Easy product return process.

So, as a retail business, you need to ensure that all of these components work reliably with one another and that your back-end is simple to operate, enabling you to reach your true potential.

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2. Limiting Your Solutions to Checkout Processes

Is having a standard e-Commerce solution a technology challenge for companies in the retail industry? It doesn’t sound like it. When companies start digitizing their sales, they often focus on payments and checkout processes, but they tend to forget what’s around a complete buying experience. 

Many retailers wrongly assume that the key to happy and returning customers is an easy checkout process. And while we agree that it’s important, you need a unified retail management system that covers all the facets of your retail business. Leveraging technology to optimize each stage of your customer journey should be your priority at all times. Your digital strategy should consider an omnichannel, responsive design, automated workflows, and an effective digital experience design.   

What does an ideal system look like? At a minimum, you want it to support point of sale (POS), customer relationship manager (CRM), inventory management, purchasing, shipping, and intelligent dashboards while integrating marketing features such as promotional campaigns and retail customer loyalty programs. For businesses that also operate multiple physical locations, managing up-to-date policies, procedures, and marketing materials, as well as store layout and distribution for businesses, are a great support for staff management and coordination.

After all, future-proof retailers are the ones that have access to a single view of customers with robust capabilities in data analytics and access to sales performance across all digital channels and physical locations.

3. Relying Too Heavily on Customer Agents

Today’s sophisticated buyers are browsing and shopping for goods 24/7. They no longer need to visit a physical store to learn about products or to make a purchase.

Likewise, younger customers might only engage with your brand via online channels, so that’s where you need to meet them when they’re ready to place an order.

Nevertheless, brick-and-mortar retailers are losing out as they rely on customer agents and physical location to make sales. And no, we don’t say that these retailers should now adopt the pure-play online approach.

It’s quite the opposite.

From the consumer’s point of view, they still want to test out and feel products at least once in person, so they can build the trust necessary to make future purchases, which gives rise to pop-up stores and showrooms.

Take Amazon, the world’s largest and most successful retailer, which has been championing the pop-up shop concept for several years. Why? Because this way, they can reach new audiences and let sensory people explore products in person but make the purchase on their terms (perhaps back home via the Internet).

Above all, it’s about balancing in-person and online shopping experiences–and the winning retailers must now cater to customers’ preferences regarding when, how, and where they shop.

4. Failing to Deliver a Consistent Digital Experience

People increasingly prefer to make purchases via their mobile devices. In fact, 72.9% of buyers worldwide bought something online using their phones last year. So, it’s fair to say that they naturally expect the same experience regardless of the channel they use to engage with your brand.

But retailers are yet to embrace the potential that device proliferation can offer. Users still run into problems with m-commerce, which primarily include inconsistent brand experience, pages and links that are too small for a mobile device, and security concerns. 

The technology challenge the retail industry faces is limiting their digital experience design to desktop, failing to grasp an omnichannel strategy. Shoppers have high expectations regarding mobile shopping, so having a buy now button on your mobile app is not enough.

Your customers want to browse product catalogs, compare prices, read reviews, make purchases, and review past orders; thus, they expect product descriptions, prices, promotions and inventory information to be up-to-date and consistent across all channels.

At the end of the day, buyers want convenience, consistency, and value, so as a retailer, you must stay dynamic and deliver just that.

Technology Challenges in Retail Industry: Wrapping It Up

Digital transformation in retail can seem daunting at first, but you don’t have to be on this path alone. At Base22, we can help you create a user experience that leverages your back-end systems and provides cohesive customer dashboards to employees so that you can stay competitive in today’s retail environment. 

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