Retail: 4 questions to ask yourself starting today

Is your retail business really ready for what’s coming?

For most retailers, the answer is no.

Retail has been turned upside-down in recent years by the pandemic, inflation, and geopolitical instability. Consumer behaviours have changed, e-commerce has exploded, and AI has become a must. First-party data, omnichannel orchestration, automation... it’s hard to tell what’s truly essential amongst all the buzzwords.

In this context, it’s not marketing initiatives that are lacking—it’s the right questions.

I’ll be helping you prepare for the retail industry of the future with 4 key questions.

• Where does your retail omnichannel strategy stand as of today?
• How can you stay competitive in a price war?
• How can you get the most out of AI in retail sales?
• How many of your customers do you actually recognize?
• Conclusion
  

Where does your retail omnichannel strategy stand as of today?

E-commerce is now over 30 years old. An entire segment of the population, now quite significant, was born after Amazon. And following a post-pandemic correction, e-commerce has continued to grow. In Canada, it represents around 13% of total sales (excluding food, cars, and gas).¹

In short, e-commerce is significant, but still in the minority. It’s shaking up operations, but treated like an uncomfortable exception. And yet it’s essential everywhere. Or at least in every department of any self-respecting retailer.

This co-habitation between in-store and online channels has given birth to “omnichannel commerce,” or the new buzzword, “hybrid stores.”

Omnichannel orchestration is playing catch-up

Even if omnichannel orchestration has been on people’s minds for over 15 years (we wrote about the topic in 2015!), it’s still far from delivering its full value.

At many retailers’, it’s in place and operational. But without deep transformation, which has often been postponed over the years, many struggle to derive any real benefits from it.

Before you get fancy, work on the basics

While a number of these questions still have no clear answer for many retailers, the most recent articles on hybrid stores highlight an avalanche of new technologies. Video analysis with AI to measure traffic, sensors to track interactions with products, interactive kiosks, augmented or virtual reality, etc.

And yet, the integration of online business into in-store operations, in a fluid and skilful way, is far from being a done deal. It’s still where the real stakes of retail business come into play.

• Offer a vast selection of products
• Ensure availability (lead times)
• Offer competitive prices
• Ensure healthy stock turnover

The coming decades will continue to be devoted to advancing omnichannel orchestration. This should remain your top priority, well ahead of the next technological trend.

A retailer offers a clothing alteration service as a distinctive element of their business.

How can you remain competitive in a price war?

Even if inflation has recently been mitigated, the perceptions of the wider public remain hypersensitive. Purchasing power is being pinched and people are looking to save money. The LoyalT 2025 study shows this clearly: Canadians are changing their behaviours to maximize their savings. In 2021, 23% adjusted their habits to earn more points; that number is now 37%.²

Discount brands are more popular than ever, to the point where they reach every segment of the population. In store, availability that is immediate and at the best price remains the focus of concern. In this context, retailers are facing stark options:

• Compete on price and go up against the giants of retail (Amazon, Walmart, Costco, AliExpress, etc.)
• Offer added value with truly distinctive services
  

The pull between these two poles is intensifying. When everything is available everywhere, even “exclusive” products, there is no viable position in-between.

The search for savings is forcing brands to find their niche

When everyone is promising the same thing (good service, a good experience), there is no way to distinguish yourself. Even the most informed customers struggle to identify the unique value of a retailer.

Neat displays and a polite “hello” aren’t enough anymore. Neither is the mere presence of staff on the floor. Your clientele is becoming increasingly better informed. When they arrive in-store after having listened to a niche YouTuber, it’s hard to make a sale or perform well with employees whose understanding of your products is just “not bad.”

Services that truly make a difference

The services that let brands stand apart are also those that are the most thankless and the hardest to deliver:

• Advice that is (very, very, very) specialized
• An exceptional ambience (for a clientele that has seen others!)
• In-store snack offerings
• Configuration, assembly, customization, alterations
• Repairs, maintenance, replacement parts
• Buybacks, refurbishment
• Rental, loan
• Courses, workshops, events, special evenings, shows, talks, etc.
• Subscriptions (content, applications, SaaS, etc.)

Some of these services are for a fee, others aren’t. Some are offered to specific segments of your clientele, in specific contexts, or are more suitable for certain sectors of activity.

Formerly considered “value-added services,” many have become conveniences. An advantage has become an expectation. Such is the case with free delivery or financing (ex., Affirm and Flexiti). Others, like extended guarantees, continue to exist but no longer have the same reputation or attractiveness as they did in the past.

Differentiation through services isn’t reserved for luxury retailers. Even accessible brands are already employing this approach. IKEA is a good example of this, with a full customer experience, from in-store pick-up and delivery to design, assembly, and installation.

Beyond price and immediate availability, which the discount brands already understand, it’s distinctive services that can incite your customers to visit.

Because you can’t claim to stand out from the crowd without... standing out from the crowd!

A retail business analyzes traffic in-store.

How do you get the most out of AI in retail?

Retail business isn’t the easiest playing field for artificial intelligence (AI). Data and documentation are in short supply.

AI is more quickly transforming sectors in which data are abundant and well documented (finance, law, technical sectors), fields often considered more vulnerable to transformation by AI. The same cannot be said for retail, where documentation and data are often incomplete, fragmented, or absent.

If you don’t know it, how will AI be able to understand it?

AI can’t solve everything. Without documentation and sufficient data, it can’t learn.

This results in a number of obstacles I’ve observed amongst the majority of retailers:

• How can you target future customers if you don’t know who your current customers are? With many retailers, consumers aren’t identified. When you don’t know how many there are or their profiles, it’s hard to segment well.
• How can you prevent churn without tracking (and without having identified) the relevant signals?
• Have you started exploring what causes the effectiveness of marketing to fluctuate? For example, does the weather really influence results, or is this merely a perception?
• How do you recommend products to a customer who likes blue if the documentation doesn’t indicate which ones are actually blue? And we haven’t even begun addressing the diversity of more specialized features or the exceptional cases.
• Are customer service support tickets and their resolution processes documented?
• Are transportation methods chosen based on packages actually shipped, or are they still based on habits or vague agreements?

As an example, if no product in your catalogue (ex., website, PIM, or ERP) has a documented place of manufacture, you cannot know whether the sale of products made in Canada is increasing, AI or not. You then have to fall back on operational generalizations, such as “products on sale are popular.” And that is neither a learning nor an optimization.

No documentation, no impact

AI will have a major impact on the retail industry. It will start with use cases that have available and accessible data (prices, inventories, operational data). It will also affect marketing, starting with performance marketing, which is already undergoing transformation.

From now on, start documenting your products, stores (planograms, traffic, circulation), deliveries, and service requests as well as other factors likely to influence your results. Also ensure you have set up a solid, structured data strategy.

Before investing in AI, invest in your data.

A customer identifies herself at the cash by presenting her loyalty card on her mobile device.

How many of your customers do you actually recognize?

Managers in the retail industry often say “our customer.” But is this possessive “our” really appropriate?

What proportion of your clientele is really “yours”? How loyal are they?

Whatever the size of your business, the following two undertakings in loyalty deserve your attention:

1. Identify all of the interactions with your entire clientele
2. Activate the loyalty of identified customers

You know your customers... but can’t recognize them

Identifying 100% of your interactions isn’t realistic. But not even trying is a problem.

From one retailer to the next, I observe the same issues in retail business:

• Only a minority of customers are identified at the cash in-store
• Customer accounts exist for a large share of online transactions (through the e-commerce platform), but they aren’t all connected in real time to the in-store history
• Digital interactions (advertising, email, web analytics) are measured, but remain poorly connected to transactional data
• Every point of contact (customer service, value-added services, community) requires separate authentication, with fragmented data in third-party systems
• Legal and technical restrictions are increasing the types of consent needed, creating a lack of clarity and excessive precautions
• Third-party “turnkey” platforms (ex., application providers) add a layer of complexity

The result: a fragmented view of the customer.

Even with a good customer relationship management (CRM) platform and/or customer data platform (CDP), identifying the customer remains incomplete. “Known” customers are not identified across their entire journey. A large portion, sometimes the majority, of transactions come from unidentified customers, about which little information is available. A portion of your clientele is invisible.

Your priority, in the short and medium term, is clear: Consolidate your knowledge of every customer. And this challenge is major. Even with 30% of the data on 30% of your customers, you’ll only achieve 9% of the knowledge that’s possible. Accelerating this process is becoming essential. The good news is that increasingly accessible solutions will help you get there.

Understanding your customer through and for loyalty

Good integration of data is indispensable. But you still need to encourage customers to identify themselves at every point of contact.

Loyalty programs often play the role of a gateway. Points, rewards, and benefits give customers good reasons to identify themselves upon making a purchase.

Unsurprisingly, recognizing the customer isn’t enough. The best loyalty programs create a relationship, not just transactions. Using customer data, they stimulate engagement with promotions, products, or features. But one rule remains: Every initiative must create value for the customer and remain profitable for the company (value given vs. incremental margin).

No data, no personalization

Personalization has been cited as a trend in the retail industry and in loyalty for many years. But in practice, it’s clear that only a minority of customers are actually properly identified, despite this being the very basis of personalization.

Even once they’re identified, customer knowledge remains insufficient for relevant personalization. Naming the recipient of an email or listing their purchase history isn’t even the beginnings of the evidence needed for effective personalization.

The starting point is recognizing your customer. The next step: understanding them better.

What is the future of the retail industry?

In the short term, the situation is clear: Retailers must bring innovation, but above all they must make more assertive decisions. This evolution isn’t starting from zero. It’s part of a trajectory that has already been observable for many years.

Behind the constant search for trends, the reality of retail remains the same: bringing the right product at the right price to the right customer. But today, achieving this requires a lot more than before. The challenges are coming into play in omnichannel orchestration, distinctive services, AI, and the ability to recognize your customers.

The possibilities have multiplied, as have the needs of consumers. That’s why solid foundations—technical, financial, and operational—are essential for preparing yourself for future fluctuations.

At adviso, we help retailers turn challenges into clear priorities and concrete actions. Clarify your next retail growth move.

REFERENCES

¹ Statistics Canada, Table 20-10-0084-01 Annual Retail Trade Survey, Sales (x 1,000), 2024, excluding food, vehicles, and gas.

² LoyalT 2025 Study by adviso: Data collection via web panel conducted by Ad Hoc Research from May 12 to June 7, 2025, amongst 15,000 Canadians aged 18 and over who were members of at least one loyalty program.

The article Retail: 4 Questions to Ask Yourself Starting Today first appeared on adviso.ca.