Software AG senior director of industry solutions, Oliver Guy has shared three retail technology trends to watch out for in 2022.

  1. Retailers will have to prove sustainability credentials

In 2022, retailers will need to prove sustainability efforts and environmental, social and governance (ESG) credentials, or lose business. Stakeholders including partners and customers are putting pressure on retailers to be more sustainable – and will abandon them if they do not prove it.

It is a double-edged sword for retailers, involving a precarious balancing act.

  1. Tradeoffs: For example, reducing plastic use can result in higher food wastage, because wrapping some produce in plastic doubles its shelf life.
  2. Time wars: As consumers demand faster delivery, one might assume CO2 emissions will go up. However this is not always the case as more distributed fulfilment centres closer to customers mean final leg routes are shorter with a lower CO2 footprint.

Retailers will likely demonstrate their credentials by expanding local fulfilment centres to reduce both CO2 and waste, promoting re-commerce (or the selling of used products), monitoring and controlling in-store energy use, and providing consumers with some visibility of environmental impact in delivery choices.  

2. The supply chain crisis is not going away

In 2022, retailers will focus more on real-time inventory and supply chain visibility. This will help them get to grips with current delays and bottlenecks across the whole value chain. As lead times grew, creating shortages globally, supply chains broke under the pressure.

Expect retailers to respond by working to eliminate data silos and embracing real-time inventory visibility and a single view of the customer, utilising scalable and flexible APIs, integration and microservices technologies, and experimenting with innovative approaches to enhance visibility and result in new uses of AI and IoT in logistics and supply chain.

3. New competition will expand

COVID-19 shuttered many stores around the world – some temporarily, but others permanently. This resulted in the need for consumer brands to examine direct-to-consumer (DTC) models more closely. By having a transactional relationship with the consumer, these companies are becoming retailers.

More brands will expand their DTC operations. In some cases, this will create uneasy relationships with retailers who also sell their products. However, not all DTC operations will be successful – the ability to deliver on the brand promise and fulfil after the sale will be a crunch moment for customer experience.

The smartest brands moving into DTC will look at successful retail operations to learn. This will be from the perspectives of the customer journey but will also ensure they have the process and technical infrastructure to support customer expectations.