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What does 2021 have in store for Retail?

By Sponsor

9 Mar 2021


Following the first wave of the global pandemic, retailers witnessed an increasing push for e-commerce and omnichannel retailing in 2020. The temporary closure of non-essential stores forced consumers worldwide to turn to alternative shopping channels, including online, mobile and social media. Over the past few months, it has become evident that retailers with a strong omnichannel strategy and digital presence have been able to react faster to these shifts, which will undoubtedly only gain more momentum in 2021.

For example, US-sportswear retailer Nike previously reported a $790 million quarterly loss, with revenue $1 billion under initial Wall Street forecasts. Despite its weak Q4 results, the retailer reported a 75% increase in digital sales, comprising 30% of its revenue, a goal the sportswear retailer had not expected to reach until 2023. Thanks to its core strategy, which includes investing in digital, innovation and Nike Direct sales, Nike managed to expand its customer base and gain market share during an unprecedented time.

Unfortunately not all apparel and footwear retailers have been as successful, with British fashion conglomerate Arcadia Group among the latest to have entered administration in December 2020. However, not all is lost when it comes to in-store shopping and retail experience. With the start of a new year, we look at three retail trends set to emerge in 2021 and how retailers can prepare for the new year’s challenges and new retail normal.

1. Digital-first - new technologies take charge

The shift to digital received a sudden surge charge with the outbreak of the novel virus. Online sales increased 25% during a two-week period in March 2020 alone, a vast jump from the 14% compound annual growth rate (CAGR) recorded over the last four years according to the Adobe Digital Economy Index: Tracking the state of e-commerce during COVID-19 and beyond.

Although grocery sales drove this growth, e-commerce sales in apparel, department stores and beauty products increased by almost ten percent on average since the start of the pandemic, according to McKinsey & Company. Following the closure of non-essential retail stores worldwide, consumer shopping habits shifted to online channels, highlighting the need for retailers to strengthen their digital presence. Retailers who lack an online presence will struggle to connect with consumers the longer lock-down regulations continue around the world.

Soon, consumers will expect to have a seamless shopping experience, no matter which channel they use. The need to bring an in-store experience to a digital platform will only increase - making it essential for retailers to extend their presence to other channels and invest in new technologies. Artificial Intelligence (AI), robots, IoT and extended reality (XR) which includes both virtual and augmented reality (VR/AR) are all set to play an increasing role in the future of retailing. VR environments will become increasingly popular, as they can be used to offer an immersive, feature-rich and personal shopping experience online.

Luxury fashion retailer Gucci launched a new virtual shopping service earlier this year, which lets customers communicate directly with employees via video call, a first for the luxury sector. The Gucci Live service allows clients to talk with brand advisors in real-time from a new, technical "remote client" store in Florence, Italy known as Gucci 9. At the same time, AR will be used by retailers in-store and online to allow customers the opportunity to learn more about products or try on items of clothing virtually. Luxury retailer Burberry released its newest AR feature this year, which lets customers view 3D renders of its products in the real world through Google search.

2. Reimagining the role of physical stores - safety first!

The pandemic hit traditional retail store operations hard, with new social distancing, enhanced hygiene and contactless payment methods just a few of the changes witnessed. For many customers today, the highest priority when visiting a physical store in person is to get in and out as fast and safely as possible. Offering them a safe shopping experience is essential and critical to mitigating customers anxieties and boosting a return to in-store shopping. Retailers will have to reimagine physical stores’ role in the future while setting up social distancing and sanitising methods.

For example, in China, 65% of consumers care more about product safety following the coronavirus outbreak, according to McKinsey & Company’s survey. To win consumers’ confidence back in the future, retailers will have to implement policies and processes to offer safe distance shopping, sanitise products and surfaces, and communicate the rules proactively, openly, and empathetically.

Investing in new technology, such as SmartSolutions from Checkpoint Systems, is one way retailers can help improve safety and health regulations in-store while reassuring employees and customers alike. The SmartOccupancy Solution, for example, is ideal to help maintain visibility on the number of customers in a store, as it counts people entering and exiting a store in real-time. Live displays can be followed on tablets, and alerts are sent to staff when the store is close to maximum capacity. Similarly, SmartTemperature can accurately assess whether an individual has a fever from a 3m distance, offering retailers a safe way to check both employees and customers before entering the store.

Self-checkouts also offer retailers another way to reassure customers by offering increased convenience and social-distancing measures. To combat walk-aways, where the final payment is not made, but the products are taken, Checkpoint Systems offers a frictionless solution with RFID tags which are only deactivated once the final payment has been made. Store returns is another point many customers and retailers are concerned with, but Checkpoint’s Inventory Quarantine solution offers retailers an automated quarantine process for any returned goods, which handles stock in a safe and timely manner before it is released back for sale.

3. Omnichannel & Leveraging Data for efficiency

Before the global pandemic outbreak, leading digital retailers were using data to identify upcoming trends, foot traffic, and purchase recommendations. In the future, retailers will move beyond data collections and surveys and use data for the almost real-time tracking of consumer trends and shopping behaviour shifts. Since the start of 2020, several retailers have pivoted to an omnichannel strategy, focusing on e-commerce. However, if retailers cannot scale their logistical and operational capabilities, they will continue to struggle - even after the crisis has slowed down.

Having an agile supply chain assisted by RFID technology is crucial to constructing a solid omnichannel strategy. Leading retailers including Nike, Inditex and C&A have been using RFID solutions to streamline their inventory accuracy and planning, and avoid over-stocked or out of stock scenarios. RFID technology can be leveraged to increase supply chain visibility and agility as it offers precise data on product location across several hubs. Working through a response, integrated system, RFID can provide real-time data and analysis to streamline supply processes and implement safety net strategies, which retailers can use to avoid potential breakdowns and bottlenecks. Simultaneously, RFID technology also helps boost inventory accuracy, thereby decreasing the chance of errors through manual tracking.

Using these valuable insights, retailers can respond rapidly and make decisive, information-driven decisions regarding stock ordering. At the same time, they can react quickly to shifting consumer demand and redistribute merchandise across physical stores and e-commerce based on sales data. RFID is also seen as the most cost-effective and useful tool for retailers to leverage click and collect services, same-day delivery and order pick-up time slots. In the future, RFID solutions are set to become even more useful, helping retailers streamline their supply chains, optimise delivery and in-store pick-up, and order preparation.

Checkpoint Systems provides a full RFID solution portfolio, from tags and inlays to cloud-based software, encoding and tagging hardware, to help retailers achieve their RFID goals. Our solutions are implemented in stores, in distribution centres and factories throughout the world. Our team is well-experienced in implementing this technology, and we are here to support the retail industry during this unprecedented situation.


Reach out to our team here or via [email protected] if you would like to learn more