The report reveals an opportunity for retail innovation, with only 3% of retailers considering themselves leaders when compared to cross-industry influencers
Incisiv, a leading industry insights firm, today unveiled its “2024 State of the Industry: Innovation in Retail” report, in partnership with Toshiba Global Commerce Solutions. The report, surveying 138 U.S. and Canadian and 100 Latin American retailers, explores pivotal trends in retail innovation.
Redefining Innovation Benchmarks:
Retailers show different innovation maturity levels based on their benchmarking approach. While 17% of U.S. and Canadian retailers see themselves as leaders against their retail peers, only 3% consider themselves leaders when compared to cross-industry leaders such as leading technology firms and digital retailers. In 2024, retailers will increasingly look to learn from innovation best practices from cross-industry leaders such as technology firms and digitally native brands.
Catalysts of Committed Leadership:
Leadership’s role in innovation is crucial, with 65% of retailers in the U.S. and Canada stating their leadership is committed to innovation. Fifty one percent of these firms maintain open communication channels, compared to 18% without committed leadership. Also, only 29% of committed leadership companies face resource constraints, compared to 56% for their non-committed counterparts. Retailers whose leadership is committed to investing in innovation will continue to build upon early successes, and we expect the gap in maturity to expand further as the long tail of innovation investments begin to bear fruit.
The Transformational Role of Artificial Intelligence (AI):
AI is a key driver of retail’s future, with 83% of U.S. and Canadian and 67% of Latin American retailers scaling existing initiatives or exploring new investments. AI’s varying applications, such as Machine Learning and Robotic Process Automation (RPA), are reshaping customer experiences and operations. 2024 is poised to witness a significant surge in AI adoption, with retailers leveraging their potential to transform customer experiences and streamline operations.
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Generative AI: A New Frontier:
Though current adoption is low, generative AI is emerging as a captivating frontier for exploration, primarily in the U.S. and Canada. A notable 66% of U.S. and Canadian retailers and 38% of Latin American retailers are actively exploring the possibilities of generative AI. Retailers will aggressively explore generative AI applications in 2024, particularly in customer service, personalized content and promotions. However, not all exploratory interest is expected to translate into actual enterprise-level adoption, a common occurrence in technologies during their hype cycles.
Divergent Innovation Narratives in the U.S. & Canada vs LATAM:
The report uncovers different approaches to innovation, with the U.S. and Canada focusing on digital-physical unification and Latin America on ensuring existing innovation investments can be capitalized across multiple use-cases. These differing areas of focus underscore the importance of regional strategies in driving innovation tailored to specific market needs.
Expert Insights:
Fredrik Carlegren, VP and head of marketing and communications, Toshiba Global Commerce Solutions said, “Retailers that are keenly aware of the speed of digitization should look at adjacent industries for best practices to drive adoption and acceptance of AI-supported technologies to move their business forward. In 2024, the industry must watch and learn from leaders who set the tone for progress to observe how change is implemented and supported across organizations, including strengthening the associate and shopper relationship while remembering that shopper habits will vary across retailers and regions.”
Giri Agarwal, chief strategy officer, Incisiv, agreed, “Retailers today are in a global competition, where customer experience expectations are set not just within the industry but by the best across all sectors. It’s vital to recalibrate innovation priorities to compete at this level. Our report offers detailed insights for U.S., Canadian and LATAM retailers, highlighting both the unique challenges and learning opportunities in these markets. It’s a comprehensive guide to navigating and excelling in the evolving landscape of retail innovation.”
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