Retail is hurting. So why does the future of retail look so bright?
- Posted on January 3, 2018
- Estimated reading time 5 minutes
It’s time to say goodbye to the shopping malls of old and hello to an exciting future of retail innovation.
Successful retailers already know consumer expectations, fueled by our increasingly digital-first lifestyles, are changing rapidly. They are well aware of the fact that shopping malls are not how people actually want to shop.
Customers see fast, easy and personalized online shopping as the norm. It can be hard to meet these expectations in the real world, but it is something that must be done. Consider a recent global study by Avanade and EKN, which found that 56% of retailers surveyed expect their store formats will evolve into fulfillment centers by 2020.
Technology is enabling this transformational shift in retail, breaking down traditional barriers and unlocking new potential. The industry is primed for experimentation and innovation through technology. Here are five examples that could soon reshape the shopping experience and forge enduring, loyal customer relationships in the process.
Making connections, everywhere
The Internet of Things (IoT) and radio-frequency identification (RFID) are enabling a world of connected devices and objects with enormous potential in retail. The fusion of these technologies will lead to a smarter, more integrated shopping experience benefitting consumers.
Imagine a store with RFID tags on every item and every shopping bag, all of it connected to a wireless network. Suddenly, shoppers don’t have to seek out a clerk to buy their items. They simply take what they want and the transaction occurs electronically.
This human-centric approach could lead to dramatically different retail form factors dictated by how people want to shop instead of how retailers want them to shop. And the technology of course offers substantially improved inventory quality control because retailers will be better positioned to track analytics on returns, theft, and fraud issues.
Non-human intelligence is getting smarter
Artificial Intelligence (AI) has already made strides among consumers at home, particularly through virtual assistants like Amazon’s Echo, featuring the Alexa assistant. These gadgets also happen to be incredibly intuitive system agents.
As we expand into an AI-first world, brands will soon be able to better learn and predict consumer behavior, leading to deeper and more relevant shopping experiences both online and offline.
Imagine a store of tomorrow paired with AI and real people. This leads to a more sustainable workforce management approach where retailers know exactly when and where extra store associates are needed to best serve customers during a surge in demand.
This smarter approach helps retailers better know their customer wants and needs, before they even step foot inside a store. This leads to better inventory management and customer engagement focused on the idea of transforming retail locations into fulfillment centers. This new AI-powered awareness is a largely untapped retail opportunity that could open up a more approachable, informed and long-lasting customer relationship.
With chatbots, we’re not literally talking about a robot roaming your store, yammering away. These digital conversation interfaces simply help consumers quickly obtain the information they need, without having to wait for assistance from an in-store employee. Instead, they have intuitive, natural interactions with virtual assistants embedded throughout the store.
The reality of chatbots is that they are already a compelling technology investment in wide use as a self-service tool. Already, retailers have deployed SKU scanners in their shopping aisles to give customers quick info on pricing. Replacing scanners with a chatbot could take the value proposition even further, giving retailers a way to provide more nuanced help about related items and offers through a simple, directed conversation.
Data (not time) is money
If data is the new currency of the retail economy, analytics is your financial planner. Simply storing data is a fatal mistake.
With analytics, the immense amount of digital exhaust – the structured and unstructured data about shopper behaviors, trends, their likes and dislikes – becomes a virtual goldmine. Retailers just have to know where to dig.
With the right tools, retailers can harness this data to predict and create a more personalized experience that builds customer loyalty for each shopper in their ecosystem. It can also shed a brighter light on the supply chain, adding greater precision to the ordering process while reducing waste and inefficiencies.
Data integration becomes the key ingredient used in every aspect of retail. It’s not just taking a look and last week’s sales report – it’s knowing what customers are going to do, buy or experience next.
Will that be cash or check (or neither?)
Integrated payment systems are an emerging way to deliver quick and easy checkout for in-store customers. From RFID sensing shopping bags, to mobile payment systems, an integrated and convenient experience with purchases, returns and exchanges will be key.
These solutions offer some immediate business benefits. They save money through more automated transactions, they improve financial accuracy by removing humans from the equation, and they improve forecasting by boosting financial visibility.
Beyond these obvious considerations, integrated payment systems can help retailers turn records and transactions into relationships. Brands can use this technology to nurture purchase intent and give customers more freedom to check out on their own terms with a trusted partner.
All of these technologies are a mandate to experiment and reimagine the world of retail. Where does a retailer put their front door? Does the shopper leave the buying experience with products that day? Does it even matter?
The true future of retail is about the valued and trusted brand relationships – augmented by technology – that can be made with consumers.