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The world of business is undergoing significant digital transformation to live up to the changing consumer landscape. The retail sector too has witnessed some major changes in the recent times, specifically during and after the two-year-long COVID-19 pandemic. The best way forward is to say yay to quick change and grow business as per the evolving needs of the consumers.
Majority of the retailers in the market have embraced the change and switched to more digital-friendly business practices in order to improve their sales and services. They have adopted means and measures that are more convenient for online customers. The business models and strategies have been changed to pace up with the new suite of demands. This overall evolution in the retail sector has helped them live through the pandemic phase and lower its impact on the business.
What’s trending in the retail sector?
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Online stores have become the new favourite stop for all the shopping. From low-priced groceries to high-valued jewellery items, everything is available online on e-commerce websites, making them a one-stop shop for greater percentage of consumers.
Also, thanks to the ‘n’ number of perks offered by online retailers, people have developed a lot of dependency on digital stores even for their day-to-day requirements. Features, such as free shipping, easy returns, free cancellation, express delivery and 100% refund have pulled in greater number of customers for online stores as it saves lot of time, effort, and money. In addition, most of the e-commerce businesses these days offer lucrative deals and discounts on their products and services that attract more customers.
One-size fits all? Certainly not. That’s why the concept of customised or personalised products is in high demand in the retail sector. Nowadays, people have a changed approach, which is mainly about self-satisfaction or gratification. There is grown preference for things that can fulfil needs of an individual. The businesses which offer customised products draw in more customers as compared to retailers who offer typical goods for one and all.
The Buy Now Pay Later (BNPL) online payment option is another key feature responsible for driving in high number of digital consumers. It allows users to opt for instalment-based payment alternative for their purchases. Be it a small business or a popular brand, most retail businesses are offering BNPL payment options to their customers at physical stores as well as digital platforms.
Global scale and scope of e-commerce market
Easy access to internet is one key element in elevating e-commerce retail business. It has catalysed the digital engagement of users at they can browse any digital store online and shop everything they want from the comfort of their home just with a click of a button.
All the digital trends are driving the retail industry ahead on the growth trajectory. It is likely that the global e-commerce market size will grow strongly in the coming years.
Is the changing landscape a smooth sail for all?
While many businesses were successful in making the shift from offline retail business to e-commerce, there were several businesses who failed to cope up with the new business model of online retail space. There is a huge number of businesses that get shut because of their inability to adapt to the evolving needs of the society.
With more people shopping online, there are greater number of digital money-related transactions. This has undoubtedly pulled in attention of hackers and increased the occurrence of cybercrimes. It is essential that retailers stay alert and aware about safety of online business. They must stay compliant with cybersecurity regulations to avoid breach of cybersecurity.
Also, the cost of technology to set up a digital store is one major barrier for retailers in running an online business. To keep up with the competitive pressure in the market, digital stores need advance tech features that allow a seamless digital shopping experience to the users. However, the amount of investment in technology features prevents small businesses to offer digital services.
Hybrid shopping experience
With decrease in number of COVID-19 infections, we are gradually making our way back to pre-pandemic lifestyle. There are several things that have started functioning the way they were before the pandemic outbreak.
Brick-and-mortar stores have reopened to re-establish themselves in the market. However, certain habits, such as online shopping, seem to have become a part and parcel of our lives. The high demand and grown preference for digital stores seems to keep them running successfully. As a result, the retail business is evolving at a great pace to work in a hybrid culture.
Consumers now enjoy access to omnichannel stores and enjoy hybrid shopping experience. As per latest data by IBM, ‘hybrid shopping is the primary buying method for 27% of consumers and 36% of Gen Z—more than any other generation’. They prefer a mix of physical and digital channels as per their convenience.
Now let’s have a look at some of the popular ASX-listed stocks from the retail sector!
Coles Group Limited (ASX:COL) is one of the leading retailers of the country. The Australian supermarket giant supplies products from farmers and suppliers directly to consumers. There are more than 2,500 retail outlets of Coles running throughout Australia. It manages over 20 million customer transactions every week.
Coles allows its customers to shop the way they want, whenever they want – shop online and get products delivered at home, shop online and collect order from store, or go to the nearest store and buy your products.
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Wesfarmers Limited (ASX:WES) operates an expansive network of diverse businesses, ranging from home improvement, office supplies, apparel, health, beauty and wellbeing, chemicals and fertilisers, to other industrial products. Headquartered in Western Australia, the firm has grown to become one of the largest employers of the country. At present, it boasts a shareholder base of more than 484,000.
Woolworths Group Limited (ASX:WOW) is one fine example of a retail business offering hybrid shopping experience to its customers. The company has a huge chain of supermarkets and more than 176 ‘Big W’ stores across the country. Its digital store is also quite popular among users.
The ASX-listed firm offers multiple free and flexible delivery options, easy return, and exchange facilities as well as quick customer support.
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