Red Ant: personalisation tops integration as retailers’ greatest challenge and driver for success in 2023
A survey of UK retailers by Red Ant reveals retailers’ biggest challenges and drivers for success in 2023.
68% claim personalised services is their key driver for retail tech investment in 2023 – while personalising the customer experience has overtaken data integration to become brands’ biggest challenge (for 30% of respondents).
This year siloed data came a close second with 23% identifying it as their biggest challenge.
The research, conducted by Red Ant at Retail Technology Show in London last week, assessed 100 retailers’ tech investments since 2022.
On a positive note, 20% of respondents claim their retail budgets have increased in 2023 and 77% of retail tech budgets stay the same as 2022.
While challenges remain similar to last year, the developing investment in new technologies, such as AI, indicate that retailers are under pressure to do much more with the same.
In fact, of the 72% who claim they have already adopted AI and data analytics, 24% of these have ambitions to increase adoption, despite the biggest barriers to AI adoption being lack of strategy (for 26% of respondents), and costs (for 23%).
The complexities of regulation and compliance were a significant barrier to adoption for 18% of respondents. Among these challenges to embrace AI featured a not insignificant company culture (9%) and data requirements (8%).
A shift in retail tech priorities towards personalisation and the customer journey/experience has left omnichannel strategy ranking in fourth place.
This raises concerns around whether retailers have done enough in the year since Red Ant’s 2022 survey, in which just 24% of retailers confirmed that they have ‘a well established omnichannel strategy that works with collaborative tools and platforms and goes beyond multi-channel’.
While retailers’ intention to adopt new tech to engage with customers shows innovation, only 62% admitted to being able to provide a single customer view across all channels.
Retailers are also missing key opportunities of an omnichannel approach, with only 42% empowering store associates to recommend/upsell to customers, and 45% allowing customers to keep a shared basket when switching devices, keeping customers engaged to browse and buy anywhere.
Exploring the recent hype around ChatGPT, Red Ant asked retailers their views – perhaps unsurprisingly, 32% of brands say they don’t know enough about the potential of AI models like ChatGPT for supporting store associates, so this will be a learning curve for 2023.
Although 14% said they felt tools like ChatGPT might help store associates do their job, 50% voiced that it can’t replace the human touch. With 44% aiming to increase store associate productivity, exploration of ChatGPT with technology partners can help them to deploy this new technology effectively alongside human expertise.
Sarah Friswell, CEO at Red Ant, says: “While personalised services are clearly a major focus for successful customer engagement, the study reveals that retailers are taking on greater responsibilities to exceed customers’ expectations while facing the same budgetary pressures.”
“Much more is going on within retail businesses that influences the success of technology in a retail context, for instance those citing company culture, compliance and lack of strategy as key barriers to success. It’s easy to get excited about new tech, but taking the right steps to adopt, including first getting data in order as part of an omnichannel set-up, is essential.”
“Retailers must make sure they have their omnichannel strategy nailed, otherwise they risk not making effective use of any AI strategies and investments.”
“They’re right to still prioritise data integration and to ensure seamless and frictionless customer journeys and experiences. Once this is in place, that’s the time to invest in AI, ChatGPT tools and other new technologies that can support store associates and give meaningful business insight based on customer data.”
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