Reimagining retail and what it means for retailers in the next normal

406

The PRA and SAP’s 16th Thought Leadership Series successfully concluded last January 19 with thought leader Gabriel Lorenzo Santos, Industry Business Architect of SAP. During his session, he uncovered the list of megatrends driving the future of retail, strategic priorities to transform the shopping experience, solutions that helped retailers accelerate the need for sustainable business & purpose-driven retail as well as opportunities on how to thrive in this pandemic.

Santos observed the Global and Philippine Retail industry and shared some specific examples on how established retailers have adapted through disruptions and how they took advantage of technology. “Compared to the year when the pandemic started, the Filipino people are now spending once again.  Maybe not entirely at the same pre-pandemic level, but we are getting there.  The Philippine Statistics Authority (PSA) noted an increase in spending on various categories such as food and non-alcoholic beverages, restaurants and hotels, furnishings and household equipment for the work-from-home setups, and even clothing and footwear.”

Furthermore, “it was also observed that most Filipino consumers increased their online and digital activities.  Therefore, we can say that the spending for 2021 was mainly driven by the presence of online channels and digital payments, on top of the easing of mobility restrictions, increased vaccination efforts, and gradual opening of the economy, Santos said.”

Another significant change in buying patterns is the choice of sustainable and ethical purchases. Although value for money and product availability remains the top reason for brand switching, Filipinos are said to be considered sustainable and socially responsible shops and practices that they even see these as an added premium to the existing products and services and they are willing to pay additional 10% more than the original price,” he mentioned.

Inspired by this year’s recovery, SAP shared new business models to stay afloat during the pandemic. “With the mobility restrictions, a lot of supplies couldn’t reach their intended distributors and retailers.  So, during the previous years, there were several new partnerships were forged, filling in the gaps in their processes that were made evident by the pandemic. An example would be New Business Partnerships for P&G and Shopee.  Unilever, on the other hand, partnered with Grab across the region to deliver their goods to far-reached places and post their products on GrabMart.  In return, they supplied sanitation and hygiene materials that will help Grab riders maintain good hygiene, which is very important now during the pandemic. Expanded product mix. Breweries with the likes of San Miguel, Tanduay, Emperador, transformed a portion of their alcohol and liquor production to ethyl alcohol production, increasing the available sanitation products in the market. Lastly, New Product Offerings, retailers have started pushing out their products and services outside their brick and mortar stores and closer to the community.  We’ve seen food trucks of F&B establishments, availability of products on online stores such as Grab Market, and again pushing the products to places of essential travels such as groceries,” he discussed.

He also elaborated that PhyGital or Physical + Digital retail is becoming the new norm and social commerce as the new engagement model in which transactions happen on social platforms such as messaging apps and social media platforms – expanding the omnipresence of a retailer.

While it is a fact that the pandemic changed the way we shop, SAP has been behind retail organizations helping them to survive and thrive under the unprecedented changes and presenting them with new business realities.

On the other hand, Santos discussed the strategic priorities based on their sub-sector, market position, and key differentiator and it featured the following: Being customer-centric across the value chain; serving the “segment of one”, implement digital supply chains; redefine stores, and new business models. These priorities are needed to be done to expand the product and service offering with the use of technology to create lasting relationships with your customers and to thrive in the market today

Lastly, Santos expounded that this customer technology architecture really identifies the essence of investing in an intelligent and agile enterprise. It is important to know the context of your customers and understand their experience; identify the gaps that needs to be addressed, whether it’s a product availability issue, product quality issue, delivery and logistics issue, or store personnel issue; and know that technology is not just another cost but a strategic driver. It’s a good start to identifying areas for optimization and areas for improvement and innovation.

The 16th Thought Leadership Series was hosted by Raphael Layosa, Founder and CEO of Retailgate Technologies, Inc. – a smart retailing enabler geared towards empowering retailers with Artificial Intelligence Tools and Solutions in pursuit of digital transformation to strengthen sales and improve Customer Experience and Chief Technology Officer of United Neon Media Group and was graced by Socorro Bautista, Director, PRA & President, Blooming Ventures, Inc.

It is proudly co-presented by SAP, the market leader in enterprise application software and program partner Retailgate Technologies, Inc.

For more details about PRA Activities, email the PRA Executive Secretariat at specialprojects@philretailers.com.