Why Brands Should Digitalize Their Store
Digitalize or Disappear
Why Digitalize Your Store?
March 2022 – As beauty brands and retailers attempt to envision the future of retail post-pandemic, they would need to cast their gaze past their own industry (beauty retail) and shift their vantage point towards looking at other industries or categories to identify and understand the momentous changes of the retail landscape.
The route to retail ascendency starts by first learning from the apex predators of retail – Amazon, Alibaba, Walmart & JD.com. Instead of concentrating on the characteristics & day-to-day operations of this class of ‘predators’, it is worth analyzing the key overarching trends among these giants to better understand how brands and retailers can navigate into the future of retail with success. And the key theme is this – to digitalize or disappear. Retail giants are infusing digitalization into all aspects of their supply chain, from manufacturing to their retail store. Hence, the good news is that retail, or beauty retail for that matter, is here to stay…but only if it adopts & embraces transformative digitalization.
“I’m Still Hesitant to Invest in Digitalization”
To further cement the significance of digitalization in stores, statistics from Mordor Intelligence shows that the value of the global digital transformation market for the retail industry is expected to grow at a compounded annual growth rate of 18.6% from 2020 (USD143.55 billion) to 2026 (USD388.51 billion). A study in 2022 by Epson found that 75% of consumers would choose retail over online shopping if the shop offers immersive experiences. Furthermore, an astounding 87% would frequent retail stores if they had interactive devices.
Findings (2020) from Zinnov, a global strategy & management consulting firm, indicates that within the span of six months, the retail industry has invested three years’ worth of digital transformation – mainly across technologies such as Virtual Reality (VR), Artificial Intelligence (AI), Augmented Reality (AR), Blockchain, Big data, Internet of Things (IoT) and Customer Relationship Management (CRM) tools.
At the height of the pandemic, the term ‘retail apocalypse’ was painfully evident and felt among many businesses. The silver lining provided by BCG illustrates the 7 basic functions of retail, separating the functions between those dominated by e-commerce and those that are not, as seen in figure 1. These insights are vital as the last 4 functions – ultra-convenience, product touch and feel, immersive exploration, and personal and trusted advice – allow brands and retailers to harness technologies such as AI, AR, VR & the Metaverse, to enhance the consumer experience in-store.
How Can Brands Digitalize Their Store?
The digital ecosystem is constantly evolving with a multitude of solutions for business’ disposal. However, digital transformation from 2022 onwards should lean towards a fusion of the physical world and the digital world, rather than focusing solely on digitalization. This new term ‘phygital’ has transcended from a point of discussion to the future of retail… or more accurately, the future. Many brands, both within the beauty retail industry and outside of it, have already started to adopt this ‘phygital’ revolution.
Casting our gaze towards the Big Apple, tech giants such as Google and Amazon have already entered the retail landscape with digitalization at the forefront. Every product in Google’s first physical store invites tactile interactions with cutting-edge technologies to impress. Their ‘Google Imagination Space’ is an encompassing interactive space that acts as a concierge with real-time translation available. Amazon Go by Amazon has streamlined the shopping experience by removing cash registers. Mirroring online shopping, shoppers can simply place items in their shopping cart and stroll out of the store.
The beauty industry is not far behind. Just look at Allure’s first physical store where consumers can ‘shop inside a magazine’. Big players like Chanel has also moved into hybrid retail with technologies like their Beauty Creative Table allowing consumers to interact with digital screens for online makeup tutorials & virtual makeovers. Numerous beauty brands like Shiseido, L’Oreal, Sephora, to name a few, have also incorporated experiential components into their retail stores to boost consumer engagement.
Stepping into the future of beauty is imperative and beauty brands have to evaluate the cost of inaction by asking themselves: Digitalize or Disappear?
Meiyume is already at the forefront of this digital evolution and we are ready to embrace transformative innovations and venture into the future of beauty.
Contact us at firstname.lastname@example.org for more information on how our product and retail solutions can scale your brand and business to new heights.