According to Xiatech’s recently released industry forecasts for the next year, 50 percent of large retailers that fail to develop adaptive operating models designed to continuously provide customers with personalized experiences and value will fail by 2030.
“After coping with severe business disruption from the pandemic, 2022 was the year that retailers invested heavily in creating omnichannel customer experiences,” said Jonathan Summerfield, Founder and CEO of Xiatech. “In a challenging economic environment, we anticipate that in 2023, business leaders will seek to further streamline operations and use analytics to eliminate unnecessary cost and risk to revenue generation by enabling the seamless purchase and timely delivery of products to their customers.”
Over the past year, Xiatech has spoken to a number of business and technology leaders at retailers around the world. Based on those conversations and other sources of insight, such as an analysis of data in Xfuze, Xiatech’s hyper-integration platform, here are the team’s predictions for 2023:
Xiatech forecasts for 2023 for retailers
10 The end of the free return. Under pressure to cut costs, retailers will start charging customers for returning online purchases. This initially financially driven change is perceived by customers as an environmentally friendly decision in the long term. Incidentally, the circular economy will benefit when customers decide to gift and buy unwanted items as the economy becomes challenging for millions of people worldwide.
9. Composable goes mainstream. Recognizing that legacy technologies are preventing their companies from responding quickly to market changes, including threats and opportunities, the majority of large retailer executives will add composability (choosing and integrating best-in-class digital services and business applications instead of monolithic ERP). Implementations) as a board-level topic as they explore how to improve business agility.
8th. Hyper integration is gaining acceptance in the industry. Enterprises’ urgency to significantly reduce the time-to-insight needed to accelerate business transformation, while lowering the total cost of ownership of technology, will prompt business and IT leaders to rapidly adopt hyper-integration platforms, enabling real-time systems integration , data management, advanced analytics and process automation capabilities in a single solution.
7. More industry consolidation. Many retailers that have failed to adapt to major shifts in consumer shopping preferences and behavior in recent years will be acquired in 2023. Additionally, forward-thinking retailers will adopt tech startups to stay ahead of industry peers as competitors and bring customers a higher level of personalized and engaging products and services, as the heats up.
6. Direct-to-consumer companies will dominate. Organizations that offer D2C e-commerce capabilities alongside traditional interaction channels will be leaders in their industry because they recognize the value of owning the entire customer journey, including first-party customer data.
5. Own the last mile experience. With continued supply chain disruptions, retailers will address costly delays by increasingly taking on the responsibility of manufacturing and delivering products to customers. These retailers will start their own or acquire a postal service or buy ships, planes or factories to ensure timely last mile delivery.
4. Rise of the niche market. Growing consumer interest in marketplaces, which currently account for 40% of the UK’s total online spending, will prompt retailers to create their own online e-commerce communities of loyal customers while affiliating with existing marketplaces.
3. Machines for real-time analytics. More than 70% of mid-to-large retailers have successfully deployed or started to deploy advanced analytics powered by machine learning and artificial intelligence to improve real-time insights and decision-making, including predicting customer behavior, inventory and sales.
2. Data ecosystems create market leaders. The focus on delivering market-leading hyper-personalized omnichannel experiences to attract and retain customers will drive retailers to build data ecosystems. The need for data ecosystems is forcing IT teams to quickly modernize legacy systems that are not designed to aggregate and process data from a network of internal and external sources.
1. Emergence of adaptive operating models. The majority of retailers who fail to develop digitally-enabled adaptive operating models (AOM) focused on delivering value to customers will fail by 2030. Leveraging hyper-integration to connect systems, data, analytics, people and processes, an adaptive operating model provides a single view and the ability to manage the stages of the value chain (Plan, Buy, Move, Sell and Engage) in real-time.