The rules of many retailers have been rewritten this year – but will they stick?

Retailers have been forced to re-imagine their businesses models to survive as the pandemic sent consumers online. This has seen the rise of the ‘super app’ for example. But, as economies recover, will consumer behavior actually change back? This is the million-dollar question that CIOs are looking to answer to build successful digital strategies going forward.

A recent report by McKinsey[1] maintains that consumers’ behaviors will oscillate until our routines settle down again. What digital services they adopt long term will depend on a number of factors including customer satisfaction with new digital experiences, demographics and infrastructure, for example. On this I agree.

Change is inevitable. But the technological stop gaps put in place to get through the crisis are not going to be robust enough to support future demands. CIOs will need to strengthen infrastructures and build resilient, trusted technology ecosystems to deal with customers’ digital needs. It will be a case of working out exactly what customers want and the best way of delivering it where and when they want it. This is true whether it is a weekly grocery shop, a new laptop or a taxi ride.

The rise of the super app

Companies will need to find new ways of retaining customers and an experience that fits in with their lifestyles. It is little surprise, therefore, that we are seeing the rise of the “super app”, designed to engage and monopolize a user’s time in one click.

Super app creators are teaming up with third-party merchants, so users don’t have to download a host of apps to satisfy their needs. The ultimate super apps are those that are indispensable to consumers, providing the ultimate in convenience – allowing consumers to search, purchase and pay for what they want from a single app.

Russian tech giant Yandex, for example, has launched Yandex Go, a super app that links taxi, car sharing, restaurant take-aways and grocery delivery services. The concept has been growing fast across Asia and the US.

In China, WeChat that started as a messaging service, now offers everything from food delivery to travel bookings and paying utility bills. Consumers undoubtedly value convenience. WeChat claims to have well over 1.17 billion active users and counting.

The advantage of super apps is they drive company growth, provide new, exciting ways to engage with customers, open new partnership opportunities and help retain customers by offering a variety of services. They also generate huge amounts of data, which give companies an insight into changing customer behaviors. This is the key to a successful and adaptable digitalization strategy.

Intelligent connectivity will be fundamental to change

Super apps may support our busy lifestyles moving forward. But we must not forget the importance of connectivity in keeping us all connected. The concept of “intelligent connectivity” is growing in importance. It is a fusion of artificial intelligence (AI), flexible, high speed 5G, the internet of things (IoT) and big data. It will open up the floodgates for personalized shopping and the power of dynamic price adjusting, for example.

5G will speed up transformation for companies selling products and services by offering up technology building blocks for “frictionless end-to-end experiences”, as noted by analyst firm Forrester.[2] 5G enhanced mobile broadband, for example, will provide the foundation for virtual and remote sales support, providing consumers with better product information pre and post sales. 5G will also enable other retail technologies such as virtual and augmented reality services and smart screens.

What is next for bricks and mortar stores?

Even before the pandemic, some commentators were already sounding the death knell for high street stores, killed off by all things digital. The pandemic has undoubtedly hit bricks and mortar hard.

With many of the aspects of the sales of products and services going online will there be a space for bricks and mortar in the consumer journey? I believe there will, but it will be part of the digital experience. I may have done my research online, but if I am buying a car, for example, I want to go and see it, touch it, feel it and test drive it.

We will see physical stores offering appointments with brand ambassadors who can provide more in-depth information on potential purchases. They will also act as click and collect hubs for online purchases and will be an important part of omnichannel platforms.

As technology continues to dictate the way we consume, retailers will need to evolve and change their digital strategies. Bricks and mortar will remain one of its channels for some time to come, fueled by the power of the app.

[1] McKinsey: meet the next new normal consumer 2020

[2] Forrester: 5G opportunity in the retail sector 2020