Retailers worldwide will continue welcoming customers back into their brick-and-mortar stores as more people get vaccinated against the ongoing COVID-19 pandemic.

So far, the Australian retail industry has experienced moderate growth since the beginning of the outbreak. The Australian Bureau of Statistics (ABS) reported that retail sales rose 1.8% this past February, making up for lost momentum after the omicron variant occurred in January.

Retailers in Australia are still grappling with some negative effects of the pandemic, including global supply chain disruptions, steady inflation, labour shortages and ever-evolving consumer behaviours. However, these challenges prompted companies to have a renewed focus on potential retail technology investments.

It can be difficult for any industry to determine which technologies will offer the most valuable benefits and return on investment (ROI), and retail is no exception.

Here’s what to expect from retail technology, its role in the Australian retail landscape and what tech opportunities could help retailers improve their operations for the future.

Benefits of Investing in Retail Technology

It's undeniable that the world is heading in a direction fueled by technology. The coronavirus pandemic accelerated the trend of rapid digitalisation, showing no signs of slowing down.

Many businesses worldwide and in various industries have made significant investments in digital technologies, from artificial intelligence (AI) and machine learning (ML) to contactless payment options and inventory management software. Retailers must follow suit to maintain a competitive edge in the industry.

Why would an Australian company want to invest in the latest retail technology? Here are some key reasons why it's beneficial for retailers to adopt new tech:

• Reduces inventory costs

• Keeps track of margins

• Facilities inventory control

• Automates routine tasks

• Improves forecasting

• Strengthens relationships with suppliers
  

Three qualities of a successful retailer, no matter what country it operates in, include speed, agility and efficiency. Consider logistics in retail — consumers now demand fast shipping options and will even pay more for expedited deliveries. Some companies are now experimenting with advanced drone technology to assist with last-mile deliveries, and it's proving successful so far.

Transformative Retail Technologies Australian Retailers Should Invest In

Adopting essential retail technologies can be transformative for retailers in Australia, as it will set them up for a digital future. Anyone can recommend adopting new digital retail technologies, but how should a company determine which investments are worthwhile?

A retailer must consider several factors before making any tech investments. Some examples include:

• Aligning investments with the company's current business model

• Identifying what outcomes the business wants to achieve with technology

• What funds are available to use for tech investments

• Which technologies to invest in based on industry trends

• How retail tech will be implemented

• Anticipating cultural shifts after making significant investments
  

Many types of advanced digital technology are on the market, so deciding which opportunities to take advantage of is no easy task. Here are some examples of top retail tech that could benefit Australian companies.

Staff-Free and Cashier-Less Stores

Some retailers are struggling to fill open positions to build a sufficient workforce due to ongoing labour shortages. Companies can invest in automated checkout systems and staff-free, cashier-less stores to overcome deficiencies and keep operations running smoothly in brick-and-mortar locations.

Consider Amazon Go, an autonomous store that uses Just Walk Out technology to charge customers for items purchased. Amazon Go stores are not completely free from human workers, but this advanced technology is a prime example of what staff-free and cashier-less stores can do for a short-staffed retail operation.

Voice Commerce

It's no surprise that customers want to use digital voice assistants like Siri and Amazon Alexa to purchase items online with voice commands.

According to a 2021 report from Cybersource and PYMNTS, voice recognition tools reduced friction in Australian consumer shopping experiences by a whopping 89%, more than any other country included in the study. This figure proves that Australian merchants investing in voice commerce solutions are reaping major benefits.

Renewable Energy Sources

Many companies are looking to adopt sustainable practices, and retailers are no exception. One method of achieving sustainability is investing in renewable energy and green solutions. It's obvious that an environmental business strategy benefits the planet but can also drive positive outcomes.

Research from KPMG suggests that 80% of customers prefer buying from brands that share the same values. Another 54% of respondents say a company's environmental and social responsibility goals influence their purchasing decisions.

Mobile Applications

Retailers that have yet to develop a smartphone application for their business are falling behind the competition. There are mobile apps for just about everything, from financial services to fitness to streaming to gaming, so it's no surprise that many companies want in on the action.

Statista estimates that shopping apps accounted for 59.9% of mobile app usage in Australia during the third quarter of 2020. Retailers investing in mobile app development projects will likely open up opportunities to build customer loyalty, bolster brand reputation and increase sales.

Various AI and ML Applications

AI and ML are revolutionising almost every industry. Retailers may feel intimidated by these types of investments, but starting small with low-cost solutions is possible. For example, it's common for retailers to use inventory storage options, such as vertical carousel storage. They increase repository space, simplify order picking and keep the stock room organised.

These solutions offer many advantages to modern retailers, but why stop there? Implementing AI-powered inventory management software solutions or leveraging ML-based tools to predict consumer behaviour is also highly useful and could transform retailers' operations.

Big Data and Data Analytics

Big data is more than just a buzzword. Retailers can improve the customer experience (CX) by investing in big data solutions and various analytics tools. A couple of years ago, Australian grocer Woolworth collaborated with CROSSMARK to develop the Compass app.

The free app is a data analytics platform that allows suppliers to monitor product sales performance closely and calculates daily sales expectations for every item in each store. These investments can improve relationships between retailers and suppliers, recoup millions of dollars in lost sales, and enhance customer satisfaction.

What the Future Holds for Retail in Australia

It's expected that tech will play a significant role in the future of Australian retail, so companies must determine their investment strategies and adopt digital solutions. After a couple of challenging years, now is the time for retailers to digitally transform their operations and take advantage of any tech-related investment opportunities to prepare for the future.