How are digital technologies a critical aid to retailers in times of inflation?
Embracing new retail technology tools to fight inflation
According to several reports, annual inflation is at its highest level in almost 40 years, particularly since 1991 in Canada, with estimates showing product cost increases of up to 15% by the end of the year. This unprecedented price increase is putting significant pressure on the average consumer, who is staying away from recreational spending and becoming more concerned about their purchasing power. These reactions from shoppers are impacting the retail industry, which is once again being struck by this new event.
In fact, retailers must also manage this price increase in addition to having to worry about their relationships with their customers, which are becoming more fragile. This situation forces them to look for alternatives or innovative ways to maintain the retailer-customer relationship as well as stabilize their figures despite the costs that continue to rise.
With the pandemic having already shifted some of consumers’ habits, they are relying more heavily on the technology solutions that served them well during this period. Retailers, in turn, have responded to these expectations and have accelerated the digitization of their stores to manage their operations better and create opportunities to connect more closely with their customers face-to-face.
Today, as inflation continues to rise, it is interesting to see how many retailers have understood the potential of digital technologies and are beginning to use them to combat rising prices.
According to a Forbes’ article published last month, experts are encouraging retailers in the industry to take advantage of technology to reduce costs and get ahead of the competition. Among the technology solutions touted, smart shelves and self-service checkouts are at the top of the list and are greatly appreciated by consumers, who find it easier to navigate their shopping journeys, especially when it comes to learning about displayed prices.
Therefore, when we talk about smart shelves and take a closer look at what that means, we learn that they are composed of an essential tool: electronic shelf labels (ESL). This innovation comes with many advantages, including access to transparent prices, but especially in real-time, which is essential in times of inflation. Moreover, thanks to these intelligent displays, buyers can also consult multiple information on the product they want, including its origin, the quantity in stock, and especially the available promotions.
In the same way, retailers who have installed this technology can then follow the evolution of their stocks to better respond to their customers’ demands. By also taking into account the products that are approaching their expiration dates, they can then better display current promotions. Coupled with other technology solutions such as the use of AI by Shelf Vision, retailers can also improve their inventory management by controlling the quantity of products on the shelf.
In conclusion, the rise of many technological innovations have become essential during the pandemic and are now being used as an important tool to fight inflation. By leveraging digital price tags and other technologies, retailers can stabilize their prices and their relationships with their customers.