Henrik Salicath

New technology and artificial intelligence can stop stores from shutting down

A new analysis from Dansk Erhverv tells a sad, but not surprising story. In 10 years, 3,200 stores have been closed around the country - equivalent to 11 percent of Danish stores. In the same period, online shopping has been rampant in everything from fashion, technology, toys, hardware, and groceries.

 

AI in retail

 

Danske Erhverv's analysis shows that part of the closures is the result of significant online investments in the established chains. Today, virtually all of the traditional, physical chains have opened online shops, thereby helping themselves to accelerate the progress of online shopping - of imperative necessity, of course, to meet customers' new digital habits. This development has had clear consequences, especially for the business community in smaller communities.

 

Survival lies in the customer experience

 

An interesting trend in the retail market, however, is that online shops are starting to hit the classic stores. We are seeing more and more examples of hardcore online brands and stores opening flagship stores in strategically good locations, centrally in cities. Amazon is getting there, and Boozt.com Nordic with the establishment of a store in Copenhagen with the desire to win market share in a lucrative beauty segment in fierce competition with Matas, Sephora, Mac, and others.

And like the competitors in the physical world, it all done with the desire to center the customers' personal needs. The trend is clear that retail, both physically and online, is investing massively in satisfying customers' wishes.

This tendency is extremely positive not only for the customers but also for the survival of the stores. The customer-centric mindset, which forms the basis of much of the development Dansk Erhverv describes, has a vast potential. In combination with the new technologies and artificial intelligence that are currently entering Danish retail, the mantra of the customer in the center will have a completely new and personal meaning for both stores and customers.

 

Personalized service and prices

 

With the new technologies, stores can merge all their customer-facing channels once and for all into what we call “True omnichannel” or “Unified Commerce”. Silos are still broken down today, making it possible to translate individual customer data that the stores have, into increasingly personalized offers and not least unique prices for each customer.

To exemplify, we are at Fiftytwo right now working on a solution that will reward loyal customers for their likes on social media with a personal discount they can use the next time they buy something in the same shop.

Imagine that you can automatically exchange your likes on Facebook at Matas and Føtex for a personal discount. For example, when you stand in front of the shelf front and the price of your item changes because the store acknowledges your five likes with a 10 percent extra discount. Artificial intelligence is rapidly entering stores and online shops.

 

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