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Retail Strategy

Why digital transformation is important in retail and how to get started

Without technological adaptation, traditional businesses will soon be considered irrelevant or uninteresting and this can be a threat to retailers.

Why digital transformation is important in retail and how to get startedPhoto by

| by Nimit Gupta — Digital Marketing Lead,

It is true the world has been hugely impacted by COVID-19 and its loop of variants for more than three years. Though the pandemic has hindered business activities, retailers have been mandated to accelerate digital transformation initiatives and tweak the customer journey to survive these challenging times.

This is due to the customers' desire for a personalized experience in this new normal. Without technological adaptation, traditional businesses will soon be considered irrelevant or uninteresting — and this can be a threat to retailers. Although many retailers realize this, they often do not adopt the latest technologies that would allow them to provide seamless experiences for their customers.

To remain relevant in this modern business, retailers must rethink their strategies. Many retailers who resisted digital transformation and focused instead on point-of-sale strategies now find they need to catch up.

What Is digital transformation?

We can't deny the fact every business has undergone a radical transformation in the current environment. One of the most significant factors is digital transformation. The concept of digital transformation is the use of cutting-edge technologies and business models to motivate employees to be more productive and to increase customer value. It helps organizations in creating business strategies, changes the culture, and provides better employee and customer service. As a result, businesses can adapt to market demands and changes.

What makes digital transformation more critical now for retailers?

Today, digital transformation is a not-so-new concept, with every industry going digital to improve their services and facilities to stay in front. It has indeed revolutionized the retail industry more than ever in this pandemic era.

Digital transformation is a propelling omnichannel experience tailored to the customer's needs and expectations using instant gratification, customized push notifications, forecasting market trends, strategic analysis, location-based marketing and anticipatory shipping that caters to consumer behavior across all channels.

As per the statistics of McKinsey, the pandemic has increased demand for digital technology in the retail industry. The report states that the growth of e-commerce in the U.S., estimated at 24% by 2024, jumped from 17% to 33% within two months. Hence, digital technology is imperative for retailers to transform their business model in the future.

The following are some reasons why digital transformation is important for the retail industry:

1. We won't be returning to normal anytime soon
Consumer demands and habits have changed, along with their spending styles and their channels to make purchases. With the pandemic seemingly not going away, retailers are preparing for a greater surge in digital purchases.

2. Retailers must better understand their supply chains
As a result of the pandemic, supply networks have become increasingly vulnerable. Many retailers have had problems meeting consumer demand because they could not predict it. A better understanding of inventory is necessary for retailers to plan their online and offline customer experiences.

3. Digitally-savvy companies will prosper
Digitally-savvy retail businesses are already ahead of the curve. When customers can't leave the house and spend only on essentials, digital channels help businesses remain productive. Companies with advanced digital capabilities and access to data are already using this pandemic to gain market share.

4. Customer loyalty is dependent on brands
Customer satisfaction is severely impacted by restrictions, social distancing, waiting in line for entry into retailers, maintaining personal hygiene and other preventative measures. Moreover, they want their favorite brands to provide better services while taking care of their safety. These factors drive the need for transformation more than ever.

How can digital transformations be enabled?

Invest in the following technologies if you want to transform your retail business.

  • Conversational chatbots: Customers expect high-quality customer service 24 hours a day. Conversational chatbots are typical for retailers who wish to answer customers' questions without taking much time. A chatbot can refer a customer to a human agent if it cannot meet their needs. Chatbots in retail can boost sales and reduce costs with personalized, fast messages.
  • Enterprise automation: Enterprise automation aims to streamline all manual processes, thereby easing the organization's human effort, thus reducing operational costs, turnaround times, and errors.
  • Machine learning-powered retail analytics: As organizations generate more data, they must analyze and discover insights. Using machine learning technologies, data processing becomes incredibly fast. Businesses gain actionable insights that may increase revenue and improve performance.
  • A multichannel experience: A multichannel sales approach is a hallmark of digital transformation in the retail industry, providing a more intuitive and personalized way to shop for its customers. Multichannel retailing increases customer retention and customer experiences for both retailers and customers.


The success of every retail business depends on how soon you can deliver, how quickly you can gather insight from data, and how accurately you can predict consumer behavior. This is why it is crucial to have a solid digital transformation strategy. There is no doubt that the retail industry will become increasingly influenced by digital transformation in 2022 and beyond; thus, retailers must be prepared and opt for the right technology.

Nimit Gupta is marketing lead at

Nimit Gupta

I am a Digital Marketing professional with over 7 years of cross-industry experience with SaaS Marketing being my latest passion.

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Retail Strategy


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