How has technology impacted the retail sector?



Imagine knowing what you want to buy, but not knowing where it is sold. Imagine having to queue upto make a purchase after searching long and hard for what you want. Imagine a world where not even your favourite retailer knows your name. Sound familiar?

This was the norm for retail not that long ago. The focus was on physicality – if you had big, spectacular stores in multiple locations, you were ahead of the game. But in recent years, technology has taken over from this. The increased use of technology in both the retail industry and consumers themselves has been a game-changer. No longer are retailers looking to grow by expanding their physical footprint. Instead, they are embracing the web, setting up trendy apps and welcoming technology in every way, shape and form to take retail to a whole new level.


Typically, we’d visit a website or go to a shop to look for a product or service. But with the rise of technology, we are starting to see new channels from retailers to buy and sell. Consumers now frequently receive discounts on delivery, free catalogues, invitations to download apps and complimentary add-ons to purchases – constantly expanding our methods of product discovery. Consumers now interface with new types of technology which retailers must be aware of. If they don’t find new strategies to mirror this evolution, they will not be able to keep up with the competition.


Technology in retail spans much further than just discovery. Data and analytics open doors to a range of new opportunities for retailers. Take Amazon, for example. Amazon took a traditional book and turned it digital, which created the Amazon Kindle. Not only is it a more convenient and innovative product for the customer, it takes on a whole new role as a data collecting tool – tracking what you read, where you read, how fast you read and what page you stop on – creating endless opportunities for a truly customised user experience.

Analytics in retail is extremely powerful, and retailers should embrace this for competitive advantage. The most important thing to recognise is the changing role of the consumer. Customers are no longer just the end-user of products and services – they are much more. With the right technology, we can capture valuable intelligence about customers that we wouldn’t have had access to before.

Flagship Events

In addition to keeping up with the changing role of the customer, retailers need to be technically up-to-date in order to survive flagship events and festive periods, such as Christmas and Black Friday.

Major health and beauty companies doubted their systems after seeing an 800% year-on-year increase on Black Friday. However, the truth is that their systems just didn’t have the capacity to cope with the sheer volume of sales orders on that day.

The key to overcoming issues like these during busy periods is to have a real-time supply chain and a strong connection to all the sales points (both online and EPOS) to give visibility to what is available, how quickly it’s selling and how to manage and deploy reorders. Retailers need to recognise the shift from instore to the web and prepare themselves for running out of stock. They need to match the best products and promotions to the right customers, otherwise customers will simply go elsewhere.

What’s next?

The rise of technology presents a whole host of new opportunities for retailers. Future success will not only depend on how well this technology is implemented, but on the sincerity of the organisation. These new, innovative systems are effective and will bring fantastic rewards, but can backfire tremendously if used incorrectly.

By keeping up with today’s technology, retailers can stay ahead of the game and beat the competition. It’s easy – embrace technology and keep innovating.

Shane Finlay, Head of Digital for Retail, SAP UKI