Retail Industry: Impact of Technology on Growth and Development Essay

This essay provides a comprehensive overview of the retail industry's growth and development, emphasizing the transformative impact of technology. It discusses the rapid expansion of the sector, driven by innovations in business operations and the adoption of e-commerce and social media. The essay analyzes the positive impacts, such as increased product availability, cost reduction, and enhanced customer service, while also addressing negative consequences, including increased competition and challenges for local retailers. Key issues like globalization, government policies, and changing customer demands are examined, along with the role of internal and external factors in shaping the industry. The essay highlights the importance of brand strength, customer relationship management, and the need for retailers to adapt to technological advancements and market trends. The essay also explores the use of social media marketing, e-commerce and the impact of FDI. Ultimately, the essay offers insights into the future of the retail sector and the strategies necessary for sustained success in a dynamic environment.

Essay

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
ESSAY.............................................................................................................................................1
CONCLUSION:...............................................................................................................................6
REFERENCES:...............................................................................................................................8

INTRODUCTION
The retail industry is growing at very fast rate. It is because of innovation in
business operations that has enabled industry to grow and develop. Technology has
transformed the entire retail industry by bringing together all the products at one
place (Rezaei, Fahim, and Tavasszy,, 2014) Companies are creating their own
website to increase customer base and gain competitive advantage. Also, it has
allowed customers in providing flexibility in after sales services. Website has
provided ease to customers to shop anywhere , anytime. They are available to 24 x
7 to them. Moreover, it has enabled business to get their feedback or reviews
about changes in products. Besides this, marketing and promotion is been done by
using social media. It has saved the cost and time of company. The internal and
external factors has highly influenced the growth and development in this sector.
However, technology has provided platform to expand their business (Kazis and
Molina, 2016). Innovations in operations has enabled them to recognise growth
opportunities.
ESSAY
Today' s retail industry is growing at a very fast rate. In recent years this
industry is at its peak level. Due to introduction of technology is business it has
helped them to grow and develop in quick time. There has certain change in
business operations that has occurred due to change in customer taste and
preference. All the companies in retail sector have launched their own website. This
has increased their range of business by providing goods to people. Also, new
customers are attracted towards it as they are getting goods at one place. Along
with this, the most important innovation in retail industry is using of social media to
advertise their product (Shagal, Shagal, and Sharma, 2016). Every company is using
it as very effective tool to promote their goods. The growth of this industry is
developing economies like India has increased at rapid rate. The MNC's are now
focusing on developing economies where they have vast opportunities of growth.
Moreover, it has provided flexibility in doing business by creating a platform where
all products are available at one place. The competition has also increased within
the industry. It has forced companies to develop effective strategies to retain and
attract customers. Each of them is trying to gain larger market share.
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Now there are various key issues that are been faced by retail industry at
global level. This has affected their growth and brand image. The main issues
related to this is increase in competition among them. It has reduced product
quality as well as increase in cost. Moreover, industry is now producing range of
goods according to consumer demand (Rhodes, 2015) It has created intense
competition among them. Furthermore, developing countries have been targeted by
them in order to attract more customers.
The emphasis of many retailers has now shifted from large scale expansion to
improve profitability with greater business efficiency. They have focused on
information technology ans supply chain management. These areas are been
outsourced by companies to save cost and time. But on the other hand IT pace has
to be kept with change in technology advances. E commerce has created many new
small companies that are giving tough competition to retailers. They have failed to
materialise things with IT (Gregory, 2015). This has left the market open for new
companies to enter in retail sector. Also, there are no such strict rules and
regulations made by retailers to prevent e commerce business to establish.
Convergence is becoming a hot issue in this sector. It means companies are
developing strategies on how to best use technology to engage with customers. It
has allowed them to create multi channel offering including stores, e commerce,
mail order ,etc. companies must develop a basic technological infrastructure to
provide common sales platform to customers. This will play a vital role in their
success.
However, many retailers has left behind by not using the new market
developments. Various multi channels are been created by making investment in
both human capital and infrastructure. In recent times the importance of brand
strength is very much in demand (Pantano, 2014) It is related to consumer buying
pattern and demographic trends will build strong customer relationship
management. The demand for IT experts is rising as they will be recognise
opportunities in IT to achieve greater business efficiency.
Globalisation has played a major role in retail industry to expand in Europe
and Asian markets. These markets have emerged as very popular with high degree
of success. Companies are exporting products to earn higher profits. The big and
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luxury fashion retailers have reached at global level in quick time. Another concept
used by retailer is providing new products other than its core products. It includes
electronic appliances, mobile telephony, etc. it has increases its range of goods in
new areas. A lot of changes has occurred in human resource, industry is hiring new
and qualified talent to identify customers demands and improve business
productivity (Carré, Tilly,. and Appelbaum, 2014) Also, these people can find
opportunities in areas for growth. They know how to exploit the best use of
technology to provide greater business efficiency.
Internal and external factors such as use of technology, role of government,
economic and social factors has highly affected retail sector. Government in many
countries has increased its foreign direct investment to allow retailers to do their
business. Companies are now expanding business where they find areas of growth.
Each company is entering into market to increase customer base and gain market
share. With high investments in research and technology they are identifying
change in taste and preference of customers. Also, how social and demographic
factors are influencing customer needs. By recognising this companies are
producing goods to meet their demands (Tiwari, and Mehra, , 2015) Moreover, now
customers demands is frequently changing due to emerging new local e commerce
companies. So big and luxury brands are now focusing on improving its brand
image so that they can retain and attract new customers. Business is also
increasing their product range by segmenting the market. In this customer demand
are identified and then goods is produced to fulfil them. It has changed the
dynamics of retail industry.
Impact on retail industry-
Positive impact- Constant change in technology has boosted business to use them
in increasing efficiency. It has impacted this industry in both positive and negative
way. The positive impact is that products are now available at one place and very
low cost. The range of products is now increased (Burke, van Stel. and Thurik,.,
2016) It has enabled business to exploit technology by introducing new ways of
doing business. It has entirely transformed industry by accessing goods to all over
the world. By exporting goods the cost is been reduced, therefore goods are
available at cheap price. Furthermore, after sales service is become more flexible
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allowing customers to solve their problem in less time. Organisation have effectively
used social media to promote their products. Social media marketing is mostly used
for marketing in large area. Companies are trying to attract customers through
social media. It has also helped people to know what are the latest fashion existing.
Also, they are getting reviews of products and accordingly reacting to purchase. It is
used by retailers to get feedback so that quality of goods can be improved. The
range of products is increased allowing customer to choose from a variety of
products (Lalindra and Herath, 2017) Moreover, with online presence they can
compare cost and features of goods.
Now they can shop anytime ,anywhere. Another advantage it has given is
timely delivery of goods. It is possible because of establishing suppliers and
constructing warehouses. Innovation has helped organisation to enhance its
business operations. The supply chain has become easier by maintaining balance
between demands and supply. Goods are stored in warehouse and then order is
fulfilled directly. By including a variety of new goods people can get it on one
platform. They do not have to search different markets for that.
Negative impact- The negative impact is that government has allowed FDI in this
sector, this has highly affected the local retailers of country to survive. Also, it has
created stiff competition in the market. Big brands have now entered in e
commerce and provided ease to customers (Kolchyna,Treleaven, and Aste, 2015)
With this the small business who are having physical presence is now almost
finished. It can be said that nation economy is negatively affected by this.
Government has to develop new tax and tariff policies for organisation who are
exporting goods. This has enforced companies to pay large tax amount that is
leading to reduction in profits. Moreover, strategies are developed to enhance brad
image and strengthen it. For this more funds are required to develop that. It has
affected revenue of firms. There major amount is been taken to develop marketing
strategies. For this they are hiring skilled and experienced persons. This added to
their expenses.
With increase in competition companies are unable to identify in which they
area have to focus (Rezaei, Fahim, and Tavasszy,, 2014) Moreover, it has made the
way of doing business very complex. However, this has created a gap between high
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and middle class people. The environment has becomes like a ring where
companies are not able to think outside the box. It means that they can not find out
new markets to grow. It has restricted growth limit by focusing on retail
development.
Findings:-
This essay has thrown light on how retail industry has used technology to
expand their business operations. They have successfully used social media to
promote their products. This has reduced their cost leading to increase in profits.
Also, internal and external factors have influenced this industry both in negative
and positive way (Kazis, and Molina., 2016) There are vast range of opportunities for
growth in retail. It can utilise technology for meeting customer needs. By engaging
customers through online they can easily identify their demands. Also, by solving
problems and issues in quick time satisfaction can be increased. Through this
organisation can retain their customers. Moreover, with this customer base can be
enhanced resulting in more sales and revenue. This will help retail sector to
increase their business. Besides this, it is analysed that retail sector has
implemented certain innovations that has help them to identify what market
conditions is and how it will affect them. With this they have developed strategies to
capture market and attract audience. However, frequent changes in polices and
procedures of government, there is downfall in retail sector. For this company have
to make changes in their policies which affect business operations. But retail sector
have contributed in GDP of nation (Tiwari and Mehra, 2015). This industry is
growing in developing countries where most of the people are middle class people.
It has build strong relations with government for doing business. Also, government
is helping them to by introducing FDI.
Due to increase in tax rate such as custom duty, tariff rate, etc. retail sector
is not able to enter in some countries. Also, their profits is been reduced as they
have to pay extra amount of taxes to government. This has made them to increase
price of product. Moreover, by investing large amount in research, and
implementing strategies companies needs finance for that. So they are increasing
price of product according to customer segment. It has allowed retail sector to
charge price accordingly (Carré, Tilly, and Appelbaum, 2014) Also, there are no
such rules and regulations made by government to control prices of product.
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The social media marketing has played a crucial role in advertising product. It
has enabled retail sector to promote and market it in effective way. This has
provided extra value to customer as they can compare different products. It has
made easier for them to make a decision on which product is best in terms of
features and specifications. Also, it has offered a variety of options to them. With
this they can choose from various products (Kolchyna, Treleaven,. and Aste,, 2015)
Moreover, it has helped company to take feedback so that problems can be solved
and changes in goods can be made. It has made the entire supply chain
management easier. Customers can not track their order that helps them to know in
how time product will be delivered to them. Along with this, by analysing data and
information from SMM companies can know how much effective their marketing
strategies are. With this they can identify weak areas so that it can improve.
Moreover, organisation have identified what type of customers are attracted
towards them and how much they value their product. Furthermore, this has made
easy to keep and track records of customers. By analysing this data business can
produce product that will meet people demands.
It has been found out that retail sector has boosted growth of other
companies who are entering into e commerce. It has given them a stage where they
can compete with big brands by following their business model. Also, small business
are attracted to adopt that business model (Shagal, Shagal, and Sharma, 2016) It
will help them to survive in the market. By continuous innovation industry can
improve its business efficiency which will help them to grow. They can make larger
revenues by developing new products. It will help in attracting more customers.
Besides this, due to frequent change in social and demographic factors retail
industry can be influenced. It will slower their growth rate. However, if firms can
identify customers needs then there will be no problem in producing goods. They
can make some changes in product that customer want.
CONCLUSION:
This essay throws light on how changes in retail industry has helped to
expand and transformed their business operations. This essay concludes that retail
industry has grown at rapid rate. This is because of innovation in their techniques of
doing business. This industry has taken advantage of technology and is able to
expand its business. However, technology has increased competition among them
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to a large extent. Moreover, every company is focusing on its online presence rather
than physical presence. Besides this, it has enabled business to promote products
through social media. Most of their customers are attracted through social media
marketing. Due to presence of e commerce retail industry is expanding at rapid
rate. The social media marketing has played a crucial role in advertising product. It
has enabled retail sector to promote and market it in effective way. It has been
found out that retail sector has boosted growth of other companies who are
entering into e commerce.
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REFERENCES:
Books and Journals:
Burke, A., van Stel, A. and Thurik, R., 2016. Testing the Validity of Blue Ocean
Strategy versus Competitive Strategy: An Analysis of the Retail
Industry. International Review of Entrepreneurship.14(2).
Carré, F., Tilly, C. and Appelbaum, L., 2014. Competitive Strategies and Worker
Outcomes in the US Retail Industry. Members-only Library.
Gregory, J., 2015. The Internet of Things: revolutionizing the retail
industry. Accenture Strategy.
Kazis, R. and Molina, F., 2016. Exploring Middle-Skill Training Programs for
Employment in the Retail Industry. MDRC.
Kolchyna, O., Treleaven, P.C. and Aste, T., 2015. Twitter Sentiment Analysis Applied
to Finance: A Case Study in the Retail Industry (No. 1507.00784).
Lalindra, M.V.S. and Herath, H.M.R.P., 2017. The Variance in Service Quality & Its
Impact on Customer Satisfaction in the Clothing Retail Industry of Sri Lanka.
Pantano, E., 2014. Innovation drivers in retail industry. International Journal of
Information Management.34(3). pp.344-350.
Rezaei, J., Fahim, P.B. and Tavasszy, L., 2014. Supplier selection in the airline retail
industry using a funnel methodology: Conjunctive screening method and fuzzy
AHP. Expert Systems with Applications.41(18). pp.8165-8179.
Rhodes, C., 2015. The retail industry: statistics and policy. House of Commons
Library Briefing Paper.
Shagal, S., Shagal, G. and Sharma, A., 2016. Visual merchandising: a key element
in retail industry. Management.2(2). pp.115-120.
Tiwari, A. and Mehra, S., 2015. Analytical Study of the Impact of Retail Industry in
India's Overall Development. Asian Journal of Research in Marketing,.4(3). pp.1-
12.
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