The new study by Brightpearl investigated which types of software UK retailers will invest in over the next 12 months. It found that half (50%) of retailers plan to increase their technology investments, while only 4% will decrease their spend. It comes as growth projections estimate that by 2023, eCommerce sales will exceed $29.7 trillion worldwide.
Industry leaders from 500 of the nation’s most influential retailers took part in the detailed study. The research reveals which technologies will be at the forefront of retail strategies during the year ahead.
The study suggests:
- Ecommerce software (25%), social media marketing (25%), online payments (24%), and retail operations (22%) score highly.
- 50% of UK brands plan to increase investment in retail software in 2022. Only 4% will decrease their investment.
According to internal analysis of Brightpearl’s 3,000 strong customer base, some online retailers have been seeing year-on-year sales increases of upwards of 700% this year. The customer base includes brands like Holland & Cooper, Shopify and Biscuiteers.
According to Stuart Pick, VP Global Alliances at Brightpearl, “The pandemic has been like a meteor hitting the retail sector. Software investment decisions are now reflecting a need for agility in a volatile environment.”
Brightpearl research indicates one-fifth of UK shoppers claim they will only shop online in the next five years. This highlights how integral online shopping has become to the majority of Brits. The Brightpearl study found that online firms are now prioritising investment in major technology initiatives that include: eCommerce software (25%). Social media marketing (25%), a broadening of online payment options (24%), and investment behind the ‘buy button’ into retail operations (22%).
The big shift to online shopping
Pick also noted: “There is a big shift to online shopping since the pandemic. In this new hyper-scalable era we’re seeing online retailers reporting incredible growth rates.
“In the race to attract direct sales, it’s no surprise that online companies are planning investments that will have a major impact on conversion rates. However, what’s interesting is that the data suggests a huge shift to back-end business investment. Ecommerce brands are seeking to address the operational complexities that lie beyond the buy button.”
Brightpearl data reveals that 61% of consumers have experienced issues buying from brands online since the onset of the pandemic.
Poor online shopping experience
The study found 77% of poor online shopping experiences relate to problems that happen after consumers hits the buy button. Namely issues with delivery and returns, such as not receiving items on time. Alternatively, products not being delivered where they should be.
“Investment in key areas that are ‘behind the scenes’ like delivery, inventory management and retail operations are a reaction to the problems associated with operational complexity,” says Pick. “Adding these solutions will go a long way in helping retailers enhance the experience customers receive. Furthermore, helping to adapt to their ever-changing demands. Whether that’s the channels they buy on, the way they pay, or how they choose to communicate with you.
“Companies weighing up technology investments should ensure they have the right infrastructure in place to deliver an optimal shopping experience. The infrastructure should cover all ends of the buying journey.”
“The pandemic has been like a meteor hitting the retail sector. Software investment decisions are now reflecting an increasing need for agility in a volatile environment,” adds Pick. “Unfortunately, time is not a luxury retailers have. To avoid failure, merchants must quickly adapt to the conditions of the new retail landscape. This entails having the right partners and systems in place to ensure the entire retail operation is fit for purpose.”
Top 10 Investment Priorities For 2022
- E-commerce software (25%)
- Social media marketing (25%)
- Online payments (24%)
- Retail operations (22%)
- Delivery tracking (22%)
- Customer service (20%)
- Inventory management 20%
- Supply chain 20%
- Customer reviews 18%
- Warehouse management (17%)
Enterprise Times: What this means for business?
Brightpearl’s research suggests that enterprises are now in the hyper scalable era of commerce. In this new age, only the brands that have the ability to change and adapt quickly will thrive. Yet, the research also indicates that too many firms are bogged down by out-of-date tech. Such technology worked well for the commerce landscape of 10 years ago, but is now unfit for purpose. Brightpearl would argues it actively holding them back.
The headline statistics from the study is that 30% of online firms are planning to make technology investments this year, primarily as a way of helping them to adapt to a new changing retail environment.
There is a wide range of technologies to support enterprises with every aspect of their operational requirements. Brands need to invest in it. They must break with aging systems and ramp up investment in end-to-end tech that allows them to grow, innovate and reinvent at speed. Otherwise, the danger of remaining in the slow technological road will be for retailers to become obsolete. This will mean extinction on the high street, as well as the digital highway.