The global smart retail market is expected to hit $311.3bn by 2032, expanding at a CAGR of 26.3% from 2024 to 2032, according to Acumen Research & Consulting.

This growth is driven by the integration of technologies that enhance the shopping experience and optimise retail operations.

The smart retail market was valued at $39.2bn in 2023 and is on a trajectory towards significant expansion. As consumer preferences evolve towards personalised and efficient shopping experiences, retailers are increasingly adopting smart technology. This shift is reflected in the market’s projected growth rate, indicating a healthy appetite for technological advancements in retail.

The rise of technologies such as artificial intelligence (AI), IoT and augmented reality (AR) has transformed traditional retail. These technologies enable personalised shopper experiences, effective inventory management and enhanced supply chain operations.

Modern consumers expect tailored shopping experiences. Smart retail technology allows retailers to leverage customer data to create personalised recommendations and targeted marketing campaigns, thereby improving customer engagement.

The growing trend towards contactless payments and automated checkout processes caters to the increasing demand for convenience and safety, particularly in the wake of the Covid-19 pandemic. With the proliferation of smartphones and tablets, consumers are increasingly shopping online. Retailers are investing in mobile-friendly platforms to capture this growing segment.

Implementing smart retail technology, however, requires large capital investment, which may deter smaller retailers from adopting these technologies. Also, as retailers collect more personal data, concerns over data privacy and security have escalated. High-profile data breaches have made consumers wary of sharing their information. And many regions lack the necessary technical expertise and infrastructure to implement and maintain smart retail technologies effectively.

Hardware accounted for approximately 65% of the market share in 2023. Key hardware components include smart shelves, sensors and self-checkout kiosks, which are essential for improving customer experiences and operational efficiency.

As retailers seek to optimise operations, software such as data analytics, inventory management and customer relationship management (CRM) are gaining traction. These tools are crucial for leveraging consumer insights and enhancing decision-making.

The visual marketing sub-segment, accounting for 28% of market growth, uses digital signage and AR to engage customers visually, thus driving sales and improving brand visibility.

With the rise of ecommerce and mobile payments, retailers are increasingly adopting payment technology to streamline transactions and enhance customer convenience.

North America holds a significant market share, valued at $13.72bn in 2023. The presence of major retailers and tech companies, coupled with a high rate of technology adoption, propels market growth. Asia-Pacific is expected to grow at the fastest rate. This region benefits from rapid urbanisation and increasing internet penetration. China and India are leading the way in adopting smart retail technologies, driven by high consumer demand. Europe, Latin America, Middle East and Africa are also experiencing growth, albeit at varying rates, influenced by local consumer behaviour and technological readiness.

The rollout of 5G technology is set to enhance connectivity, enabling retailers to implement real-time data processing and IoT applications that can significantly improve customer interactions. The development of tools incorporating AR and VR technologies offers avenues for enhancing customer experiences, allowing for interactive shopping and personalised recommendations. And as consumers increasingly expect a seamless shopping experience across online and offline channels, retailers are integrating their strategies to provide a cohesive customer journey.

Key players include NCR, Intel, Microsoft, Samsung, Google, IBM, Amazon, Softbank Robotics, Verifone and Ingenico.

In conclusion, the global smart retail market is undergoing a transformative phase driven by technological advancements, consumer demand for personalised experiences and the necessity for operational efficiency. As the market continues to evolve, retailers must adapt to emerging trends and consumer preferences to stay competitive.

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