Just one-in-five UK retailers have admitted that their primary goal is to provide brilliant service to customers, instead prioritising revenue generation as high street sales and footfall continue to decline.
This is according to Fujitsu’s ‘Driving a Trusted Future in a Radically Changing World’ report, which revealed that unless UK retailers better understand customer priorities, they will face a lack of innovation, CSR initiatives and technology transformation.
With consumers moving to online competitors that offer greater convenience and selection, retailers in the UK have become reluctant to invest in new technologies. In fact, despite the majority (72 per cent) of retail leaders saying technology has had a positive impact on their business, retail has the lowest investment in digital technology of any UK sector, with the average retailer investing just over £400,000 over the last five years.
What’s more, while the majority of digital transformation projects have been deemed successful by leaders, just a third (31 per cent) adopt new technologies once they have heard enough about it, and a quarter (28 per cent) approach innovation with scepticism and only adopt technology once others have.
This reluctance to innovate has led to retailers putting the responsibility of innovation onto other organisations besides themselves, with the expectation placed on technology providers, central government and the private sector to implement new technologies.
However, this has impacted the high-street further, with almost half of UK people (40 per cent) believing retailers have been too slow to make the most of new technologies.
Paul Kirkland, Director of Retail and Hospitality at Fujitsu UK&I, said: “We’re increasingly seeing retailers focus on their existing and diminishing revenue streams, and consequently missing huge opportunities by being unable to connect with customers and understand why they are moving from the high-street.
“Retailers need to reassess consumer priorities and try to get to grips with the innovations they have to make to stay competitive – even if they feel that the risk and cost associated with digital transformation outweigh potential benefits.”
Although retailers have struggled to get to grips with the changing priorities of consumers, there are signs that they are beginning to understand that their interests are increasingly focussed on social issues.
When it comes to their priorities over the next five years, the public is most excited about: the positive impact of sustainability efforts, opportunities for financial gain and new job opportunities.
And this is mirrored by retailers, with product development and innovation being the one business area they would most like to see most change. In addition, 37 per cent are confident that sustainability is taken seriously throughout their organisation.
While retailers are getting more aligned with consumer expectations, there are still some serious differences; just one in 10 retailers (12 per cent) agree they should have a positive impact on life in the UK, while nearly half of the UK public actually believe the primary purpose of a business should be to “have a positive impact on life in the UK”.
Mr Kirkland continued: “Trust in retailers has been falling over the past five years due to the disconnection between retailers and customers. Customers are increasingly engaged in social issues, and it’s crucial that their priorities are the priority of the retailer, and unless this is addressed, retailers will risk losing further custom and support. Retail fundamentally sets the agenda for the public, so it’s crucial they start being courageous by leading the way.”
