Advanced Communications Technologies Accelerate Retail Digital Transformation Amid Labour Constraints, Omnichannel Engagement Requirements, and Operational Complexity

LONDON, 8th December 2025 - As highlighted in the latest Frost & Sullivan analysis, retailers worldwide are accelerating their digital transformation journeys, with advanced communications solutions emerging as critical enablers of workforce efficiency, customer satisfaction, and operational resilience.

With more than 420 million retail workers worldwide and brick-and-mortar locations still accounting for the vast majority of global sales, retailers face increasing pressure to modernise communications infrastructures to improve frontline coordination, streamline workflows, and enhance customer experiences.

As labour shortages persist across major markets, retailers are accelerating the adoption of cloud-based, mobile-first, and AI-enabled unified communications and collaboration (UCC) tools. These technologies help address widespread challenges such as unreliable connectivity, fragmented applications, manual workflows, and limited integration with core business systems. Decision-makers cite IT, customer service, and marketing as the departments most targeted for communications technology investments by 2028.

Cloud migration continues to expand, with 91% of retailers planning to transition at least some legacy applications to cloud environments by 2027. AI proliferation is accelerating across sales, marketing, customer service, and IT - areas where the technology is already deployed in over half of organisations - while future adoption is expanding into compliance, legal, HR, and logistics. AI-powered UCC is expected to significantly improve security, productivity, work quality, and customer experience, making it a critical enabler of retail digital transformation.

Hybrid telephony dominates the current landscape, with retailers maintaining tightly integrated on-premises and cloud calling systems as they modernise infrastructure while preserving resiliency. Meanwhile, investment continues to rise in mobile voice, business messaging, cloud contact centres, device lifecycle management, meeting room technology, and augmented-reality endpoints - reflecting the growing complexity of distributed retail operations.

"Retailers are entering a decisive phase of communications modernisation," says Ian Fresco, Principal Analyst at Frost & Sullivan. "As AI matures and cloud ecosystems become more integrated, organisations that unify their communications across stores, warehouses, and corporate offices will see outsized gains in employee productivity and customer satisfaction."

Retailers report strong momentum behind next-generation CPaaS and API-enabled capabilities, particularly chatbot/AI, messaging, and video APIs - signalling a shift toward automation, omnichannel engagement, and programmable communications. Security, reliability, and ease of use remain the top factors in provider selection, especially as retailers expand tech-enabled collaboration spaces and hybrid-working support.

Looking ahead, retailers plan to increase reliance on managed services for network optimisation, cybersecurity, business continuity, endpoint management, and UC platform integration, positioning external partners as strategic contributors to long-term resiliency and innovation.

"The next three years will redefine how retail organisations communicate - internally and with customers," Fresco adds. "By embracing cloud, AI, and integrated UCC, retailers will be better equipped to navigate labour volatility, omnichannel expectations, and increasing operational complexity."

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Editor's Note

To arrange an interview or for any questions, please contact:

Kristina Menzefricke
Marketing & Communications
Global Customer Experience, Frost & Sullivan
[email protected]

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Kristina Menzefricke