Software AG Singapore, a provider of digital business platform, has released its top predictions for the retail industry in 2017. It believes that this year will see retailers striving to match Amazon’s sales and fulfillment model, engage new channels, geek up their stores, and use technology to refine inventory management and anticipate customer desires.
New Tribes of the Amazon-ization
There will be further “Amazonization” of retail, with new market entrants – as well as existing retailers – finding new ways to sell, fulfill and deliver products to eager, often impatient, consumers.
You Won’t Need a Remote for Channel Hopping
Retailers will quickly adapt and connect into new channels to engage with customers, using avenues including “conversational commerce” – Amazon Echo or Bots in Facebook Messenger.
Find More Stuff
Real-time inventory will be a reality, as more retailers realize that a rip-and-replace program for core merchandising, warehouse and store systems is not the best – or the quickest – way forward; the smartest retailers will look for other approaches like using in-memory caching combined with high speed messaging in order to provide real-time inventory levels across every location, channel, store and shipment.
Stores Geek Up to Attract Customers
Customers want to see techie gadgets when they go into brick-and-mortar stores, and retailers are going to be adding cool things like robots that give them directions, kiosks for in-store ordering, and magic mirrors for trying on clothes.
Eat Your Heart Out, Jamie Oliver
Internet of Things (IoT) will start to creep into your kitchens as devices like Amazon Echo, Hiku and others allow consumers to add things to their shopping lists. Conversational commerce will be a precursor to Artificial Intelligence and then “cognitive commerce,” which will appear over the next few years.
We know what you want
The arrival of “anticipatory customer experience” will allow retailers to manage customer expectations earlier and earlier in the sales process. This, in turn, can help retailers solidify an emotional attachment to their brand, offering customers what they want before they know they want it.
2017 will also see businesses and services streamlining their customer-facing services by launching chatbots on major social media networks. According to research by analyst firm Juniper Research, the Asian markets are more advanced in their usage of chatbots with China-based social networking giant, WeChat already actively leveraging on chatbots to improve its services. Chatbot interactions are expected to become more mainstream in 2017.
Retail industry in Asia Pacific
The Asia Pacific department store retail sales is expected to grow with China dominating the regional market representing 38.3% of the region’s department stores retail sales. China will continue to be the largest value contributor, followed by Japan, which is set to record a CAGR of 3.7%.
Indonesia is expected to be the fastest growing country driven by positive economic conditions and the success of new players to the market. In Singapore, the e-commerce market is expected to be worth $5.4 billion by 2025 and is expected to make up 6.7% of all retail sales by 2025, according to a report by Temasek and Google.
The online retail space is projected to have a 10-year compound annual growth rate (CAGR) of 18%. According to the Malaysia Shopping Malls Association, the retail industry in Malaysia which is worth RM100 billion a year was estimated to record a growth of 5% in 2016 over the previous year with one in five Malaysians spending weekends at malls. In 2017, the retail industry is expected to grow in tandem with the GDP which is at 4% and 5%.