Everything You Need To Know About Retail Digital Transformation 2022

The term digital transformation in the retail industry refers to changes, new services, and improved functioning in the existing system using technology. With the increase in technology, customers and their expectations are evolving. To meet these expectations, the retailers must also adapt and evolve. With the shift towards personalized shopping, the retailers have to focus on creating new and innovative business models rather than on a single technology.

Big data analytics, location-based services, and mobile apps have brought a significant change in the retail industry. This blog lets us delve deeper into the concept of digital transformation in retailing, its benefits and challenges, key tools, trends and impacts, and popular usages.

Why Retail Digital Transformation?

With the rise of the digital age and technological advancements, it is not easy to satisfy customers. Continuing with the traditional ways of operating businesses and providing services will not get your business more revenue. You must constantly bring new ideas and innovative business models to improve customer retention and satisfaction.

By incorporating digital transformation, you can bring agility, innovation, data intelligence, customer centricity, new value propositions, and streamlined processes to the industry.

Simply put, digital transformation in retail can improve customer experience and satisfaction by providing products and services according to their needs.

Benefits Of Digital Transformation For Retailers

Using the right digital transformation technologies and well thought strategies, digitizing can bring great benefits to any industry. Here are a few benefits that come with digital transformation in retail.

Improved Operations

Using cloud technologies can improve operations within the company and enable the retail staffs to get back to the customers quickly which eventually improves customer support.


AI tools enable retailers to sell their products in stores as well as on their website, which in turn enables customers to buy their products without having to be physically present. Therefore, AI-powered automation of retail processes like locating items, tracking inventories and so on, enhances customer experience and convenience.

Better Communication

Retailers can improve their connection and communication with their customers using social media, websites, mobile apps etc.

Enhanced Customer Experience

Technical tools help increase the productivity of employees and efficiency of services. This improvement not only enhances customer satisfaction, but also pleasant buying experience.

Digital transformation enables businesses to be customer-centered and stay ahead of the competition.

Boost Revenue

Digital transformation offers retailers the chance to reach a wider audience, thus increasing the channels of income.

Challenges In The Digital Transformation Of The Retail Sector

With the pandemic hitting the entire world that led to shutting of doors of many retail outlets, coming back to business is not easy. The retail companies that adapted faster to the changes and brought new and innovative business models were the ones to survive. Let us look at the challenges that the retail industry must overcome to grow and accelerate their business.

Adapting To New Customer Behaviors

The pandemic has forced customers to move from retail stores to online storefronts. This change has made buying products much more convenient for the customers, making them not find the need to go back to the traditional ways.

To bring customers back to physical stores required something more than just attractive products. Innovative and effective activities and services must be provided to attract customers back to the shops. More than ever, the ability to engage customers and support them through a multi-channel experience will be essential. Retailers must look for solutions that offer capabilities in personalization and seamless transition from online chat to call.

Shifting To E-commerce

As we mentioned above, with a larger percentage of sales shifting online over the long term, retailers will need to restructure and optimize their websites to maximum utility and make it as easy as possible for visitors to search and place orders.

In addition to a user-friendly website, first-class mobile apps are important for e-commerce. Most customers buy online and pick up in store, and having a well structured and designed mobile application is important to enhance user experience. Retailers must also tighten security to keep customer data as data breach can have devastating impacts on customers and on business’s brand image.

Diversifying Supply Chains

With most sales shifting online, proper supply chains to meet the delivery expectations is crucial. By diversifying supply chains and partnering with companies that can provide managed services to navigate the new trend, retailers can position themselves to excel in the competitive environment.

Tools for Digital Transformation in Retail    

Here are some of the tools that can enable growth of digital transformation in the retail industry.

Machine Learning And Predictive Analytics 

Machine learning is key in helping retailers create a bond with their customers and better understand their requirements. Machine learning is a data science that collects data from several sources and feeds it to machine learning models that in turn help predict future outcomes. These collected data helps retailers to identify shopping patterns, understand buying behaviors and accordingly, adjust promotions and special offers and provide personalized recommendations.

Artificial Intelligence

Artificial intelligence helps to easily provide 24/7 customer services to buyers. By using AI-driven chatbots, customer queries can be answered through texts or chatbot messages. Chatbots say what it is programmed to say and therefore, deliver messages that are consistent with the brand’s voice. It is a great tool to incorporate into businesses to enhance customer satisfaction.

Unified Commerce

Shoppers use multiple channels to connect with companies and expect the companies to be ready and waiting across all channels at all times. To achieve this, retailers can implement a unified commerce strategy and a single, fully integrated software platform that manages all the different systems that a retailer uses to conduct business, from one interface.

What Are the Key Trends of Digital Transformation in Retail?

Retail digital transformation is a concept that is still in its initial stage with great scope for growth. Here are the key trends that we can look forward to in the coming years.

Augmented Reality (AR)

Augmented reality technologies and tools are helping customers to try and view products from the comfort of their homes. With customer experience and convenience being the key to any business, the trend of augmented reality has high scope for growth in the future.

Mobile Applications

Mobile apps help you to connect to your customers in a better way. It is a convenient and effective platform that enables connectivity and easy communication. With the advancements in smartphones and their increased usage, creating applications for them is an essential step to take in every enterprise digital transformation. Using mobile apps, companies can provide 24/7 customer support and enhance the services they provide using advanced features.

Virtual Reality (VR)

Virtual reality has immense potential to grow and develop in the retail industry. VR enhances customer experience to the next level as it enables users to check out products without being physically present. It is a trend that customers will be thrilled to see grow and expand.

Factors That Will Impact The Future Of Retail Digital Transformation  

Here are the five major impacts digital transformation has on retail business.

Discontinuity in values and behavior of consumers

Consumer’s values and behaviors change frequently. With the introduction of digital transformation in the industry, the values, expectations and consumer behaviors have changed excessively.

Regaining control of data by consumers

With the introduction of digital transformation in retail, datas is under the control of consumers. Building a transparent and responsible relationship with consumers is important for retailers to get the data they need.

Diversifying relationships between people and machines

As digital transformation evolves, the tools that the industry uses to enhance customer experience and provide better services must also evolve. The relationship between people and machines are diversifying and the industry must make use of this change to provide better services.

Redefining the nature of consumption

New business models like sharing and subscription services have emerged. The retail industry must think of how they can contribute to realize a sustainable society by using these models.

Popular Use Cases Of Digital Technology In Retail

Let us look at some new retail technologies that enable retailers to stay afloat, engage with, and retain buyers.

Technology For Augmenting Retail Operations

  • Smart point-of-sale systems are “brainy” cash registers. Along with cash management, modern POS solutions can store customer databases, manage loyalty programs to track store inventory and monitor staff productivity, generate analytics reports and support mobile payments.
  • Retail data analytics powered with AI, can help retailers make better marketing and procurement decisions.
  • Inventory management is a stressful task. Using retail technology for inventory management can be used to make this task easy
  • Smart kiosks and self-checkout units can be used to let customers order and pay for goods without any help from the staff. Companies can also add AI features into these units to provide customers a more personalized experience.
  • Delivery systems availability has become a significant factor in the customer’s decision-making process. By providing fast and reliable same-day or scheduled deliveries, retailers can attract more customers.

Technology For Boosting In-Store Engagement

  • Mobile apps with loyalty and referral program features are essential to retain more customers. By providing special bonuses and offers to regular consumers, retailers can attract more customers and retain the already existing regular consumers.
  • Real-time marketing is a way to impress customers with a seamless shopping experience. By using technology like Beacons which enable retailers to send timely, targeted messages to consumers, you can easily perform digital marketing.
  • Digital signage solutions can catch the attention of consumers and compel them to enter stores. These signs can also influence the buying decisions of customers.
  • Augmented reality provides a safe and convenient way of shopping for customers as they can dive into AR experiences in any location and via any medium, be it a customer’s PC, a mobile device, or an in-store kiosk.
  • Conversational commerce refers to interaction with customers using messaging apps or voice technology. This tool is essential to improve customer services and answer queries.

Technology For Improving Store And Warehouse Management

  • The internet of things continues to grow in the retail sector with different sensors used for managing inventory, equipment, and utilities.
  • Security solutions like AI powered CCTVs and other anti-theft solutions help improve store safety.
  • Ensuring social distancing inside stores is crucial to prevent the spread of any disease. By placing people counting sensors around the store, retailers can enforce physical distancing measures.

Examples of Digital transformation In Retail

Digital transformation has influenced many retail operations and services. Here are a few examples of digital transformation that we can see in the retail industry.

  • Social media inspired shopping
  • Use of robots in warehouses
  • Customer service chatbots to communicate with customers and answer their queries
  • Automated checkouts for customers
  • Providing customized promotions
  • Virtual reality zones to attract more customers
  • Building mobile applications for convenience
  • Identifying poorly performing stores for betterment
  • Switching according to trends
  • Predict future sales through analysis
  • Calculate prices 
  • Meet customer needs
Start Digital Transformation Right Away

To out-win competitors for a bigger customer circle, retailers are in great pressure. The task of attracting more customers to the stores is no easy task. With their tastes, expectations and shopping needs constantly changing, retailers must incorporate digital marketing and service tools to make customers satisfied. Aside from improving consumer experience, retailers must also work hard to streamline the internal processes, manage growing relationships and reduce expenses. 

By connecting with a digital transformation expert, retailers can take some of these tasks out of their heads.

Are You Ready For This Change?

Retailers, both online and offline are hesitant to implement digital transformation. This puts them in a losing position in terms of key indicators because customers, on the other hand, are keen to respond to relevant, convenient and meaningful experiences, and spend money with brands that deliver.

By implementing digital transformation in business operations and enhancing customer services, retailers can convince customers to choose their brand. So, do not waste a moment and start right away!


To conclude, digital transformation is the key for retail growth in 2022. It is vital for any retail business who wants to stay current. 

Companies must determine their goals and choose technologies that will help them to achieve those goals effectively.