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Africa's looming 'retail apocalypse'

Africa's looming 'retail apocalypse'

One of the toughest challenges facing retailers in Africa is how to replicate personalisation that is possible online and in the physical retail environment. Legacy retail stores are being disrupted from all avenues and angles, and there is a steady adoption of digital services in Africa and South Africa, with a 'retail apocalypse' looming.

This is according to Vaughn Naidoo, chief technology officer at Altron Bytes Managed Services, a division of the telecommunications and IT focused Altron Group.

Altron Bytes Managed Services deploys and integrates hardware and software from its partner ecosystem and supports solutions with managed service wrappers.

According to the company it supports in excess of 1 200 000 devices in over 46 500 locations throughout South Africa and Sub-Saharan Africa. This support ecosystem includes the efforts of the company's over 700 technicians.

Naidoo underlines self-checkout and self-service as key trends impacting South Africa's retail market, but the technology is relevant to the rest of Africa too.

"Retail is perfectly positioned for the adoption of self-service to drive efficiencies, increase productivity and improve customer experience. If we look at self-checkout, which is targeted at lane efficiency, it lays the perfect foundation for the future that Amazon Go portrays, while offering consumers an experience that gives them the thing they want the most: the ability to get in and out as quickly as possible, especially when faced with daily or weekly grocery shopping expeditions."

The company continues to advance on technology development and roll out. It has implemented a digital bot to assist in administrative tasks related to employee on-boarding, and is assisting directly with the phased installation and use of self-checkout kiosk solutions as part of a 2-year POC at a major retailer in Cape Town.

From an Altron Bytes Managed Services perspective, self-service and self check-out is intended to complement traditional style service provision (including human capital management) within retailers, not replace them.

While they acknowledge the concern people have over the impact of robotics, AI and machine learning on jobs, they believe it has everything to do with the way technology integration is managed.

This means an emphasis on training, employee engagement, and collaboration with HR and HCM partners to ensure that there is a better understanding of the technology, why it has been introduced and what it can do to enhance processes, not replace people.

Naidoo said he would like to see official commercial rollout of self-checkout in South Africa this year.

Altron Rest of Africa

While these technology use-and test cases reflect the company's technical prowess, it also signals the intent to leverage Altron Rest of Africa (AROA) division to engage the continent and achieve what executives have described as "huge targets for Africa in the next three years".

AROA serves as the headquarters for the countries in which Altron operates within the rest of the continent, outside of South Africa.

The company is determined to entrench its value proposition which it describes as an agile managed services provider that partners with its clients throughout their digital tech journeys.

Areas of focus going forward include petroleum, workspace management and digital signage, along with the continued relevance of robotic process automation in retail.

Retail moving quickly

Market researchers and analysts all echo the sentiment that retail is moving quickly in terms of digitisation.

Gartner predicts that by 2025, the top ten global retailers by revenue will leverage contextualised real-time pricing through mobile applications to manage and adjust in-store prices for customers.

"Digital sales continue to grow, but it's no longer a competition between online and offline. Today, many retailers find that half of their online sales are supported by their stores," said Robert Hetu, vice president research analyst at Gartner.

"As customers share more data and information from various sources, they expect more personalised and meaningful offers from retailers. Retailers should assess personal data and product preferences, and translate those inputs into immediate and contextualised offers."

Toros Esim, Head of Digital Retail and Regional Director of Digital Strategy for the Middle East & Africa at Orange Business Services, said consumers are also more digitally influenced.

"While 90% of the retail transactions still happen in brick and mortal stores, (an) increasing percentage of the purchase decisions are influenced by digital. The customer journeys are not linear and are composed of a mix of digital touchpoints and physical experiences that drives the purchase behaviour. Within this mix, at physical locations, it becomes important provide digital interactivity to the users that caters to their experience. The most important customer experience factors have been identified as: efficiency; convenience, knowledgeable service and friendly service in a study conducted by PwC," said Esim.

"All these experience drivers are areas that can be augmented with the use of digital tools and interactivity and serves as a guide to where most impact can be created. This will manifest itself with increasing interactivity and therefore use of digital tools that will include but not limited to interactive digital signage, smart fitting rooms, smart mannequins, shelf edge interactivity, visual search, electronic shelf labels and digital tags, and indoor geolocation among others These are solutions that cater to increasing customer experience while also giving the opportunity to the retailers to collect more data about their interaction while they are in the store," he added.

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