Study: Retail tech investments will rise 10% in 2024
Technology will be a retail industry investment priority for 2024.
That's according to a survey of 100 retail executives from large companies conducted by IT consulting and digital services provider SoftServe and Wakefield Research in which 99% of respondents predict a surge of technology investments to happen this year. Across all respondents, investments are expected to increase by an average of 10%, while 94% of respondents reported technology to be a significant driver for new customers.
More than four-in-10 (44%) respondents say improving customer experience is one of retailers’ top 2024 goals driving technology priorities and strategies, followed by increasing customer retention (38%) and accelerating customer acquisition (32%).
Meanwhile, 46% of respondents worry new technology investments don’t leverage or integrate with data and analytics, while 71% cite store operations as the dominant area of business determining technology investments for the next year.
Half of respondents plan to invest in AI-powered customer recommendations to increase customer engagement while 47% cite generative AI as an investment priority.
Furthermore, respondents say they have implemented and expect to continue investing in technologies like smart labels (53%), in-store kiosks (49%), mobile apps (48%), online chatbots (46%), enhanced security and fraud protection (46%), mobile payments (44%), e-commerce logistics platforms (44%), omnichannel solutions (44%) and machine learning (36%).
Obstacles to technology implementation
With only 3% of respondents identifying as earlier adapters of new technology, common hinderances to rolling out new technology solutions include:
- “Conservative culture” that is slow to adapt (43%)
- Limited in-house expertise stood (40%)
- Lack of clearly defined outcomes for measuring success or ROI of new technologies (33%)
Other challenges
According to respondents, several threats stand in the way of achieving their 2024 goals, including:
- Consumer data management (33%)
- Consumer protection (33%)
- Workforce shortages (32%)
- In-store theft (31%)
“With the rise of e-commerce and embedded finance – and now, AI – engrained in every fragment of the retail industry and its counterparts, executives are seeing technology measures as the only way forward to a competitive future,” said Mike Ortiz, SoftServe segment head of retail. “From online carts to last-mile deliveries, or storefront shopping to contactless payments, retailers are thinking about how they can control and provide a seamless experience. Their chosen technology investments and predictions will be key in how these scenarios evolve and transform the industry in 2024.”
The survey was conducted by Wakefield Research and comprised of 100 U.S. retail executives responsible for IT, product development, or customer experience at companies with minimum revenues of $1 billion.