2018 retail technology predictions part 3
“With customers demanding a deeper emotional connection and more personal experience with brands, we can expect to see retailers revaluating their business models to take a more ‘human-centred’ approach during 2018. Over the past year, we’ve seen a number of brands enjoying success from service-led approaches, including Deliveroo with its delivery service, and Cornerstone with its subscription model. The market could change significantly in the next 12 months as retailers try to deliver a better service driven approach to retailing. These opportunities will be further imploded by the impact of connected devices becoming more mainstream.
Innovation has been another big focus area for retailers in 2017 – many have either set up innovation capability or partnered with someone to do so – this is key to leveraging emerging technology and have a space to ideate, test and learn to create experiences that provide a differentiator. Many retailers have become more comfortable working with new and niche technologies and solutions to breakthrough some of the challenges being faced in retail. The key challenge I see here is how retailers can take this from a pilot or trial into something which can be scaled across their whole portfolio. As these technologies evolve and costs decrease, we will see the retail sector experimenting with new ways of engaging the customer and offering a personalised experience. This could in-turn see the revival of the physical store.
In 2017, Amazon’s acquisition of Whole Foods sent shock waves through the industry – suddenly, the notion that brick and mortar stores are dying was challenged. With the various uses cases for technologies like AI and AR to improve the customer experience, we can expect other retailers to re-evaluate brick and mortar stores as vehicles for driving loyalty in 2018. It could result in the return of the physical store, but not as we once knew it – the store of the future will be based around personalised customer engagement, immersive experiences and selling not just products, but entire lifestyles.” Bhavesh Unadkat, Principal Consultant of Retail Customer Engagement, Capgemini
Also of interest: 2018 retail technology predictions part 1
“Initial forays by retailers into the mobile wallet space received mixed results. High profile projects such as CurrentC failed to gain traction, and there was a sense that the technology giants and banks were set to dominate the space. Fast forward to 2017. Mobile order and pay accounts for 10% of Starbucks’ in-store sales in the US, and Walmart Pay could shortly become the country’s most used mobile payment platform. Emboldened by this success, we have seen the launch of various retail wallet solutions across the globe, such as Tesco Pay+ in the U.K. and Decat Pay in France. This is a trend that will undoubtedly continue into 2018 and beyond.
Resurgent demand for digital retail wallets is testament to the huge benefits they can deliver to retailers and their consumers. 51% of consumers want to use a retailer’s app for faster purchases while in a bricks and mortar store. Wallets incorporating in-aisle, scan-and-go technology enable shoppers to simply scan items with their smartphones, checkout in-app and walk out of the store, completely removing the frustration of waiting in line. If checkouts are still in place, however, wallets can support various payment technologies including NFC, QR codes and Bluetooth for maximum convenience.
Digital retail wallets also offer the ability for retailers to get closer to customers than ever before. The future of marketing is in leveraging advanced artificial intelligence (AI) solutions to deliver unique, one-to-one interactions with consumers. Device makers, social platforms and retailers are all converging in a bid to control these interactions. With a wallet offering, however, it is the retailers who are in prime position to collate and leverage consumer data and trends to provide personalised experiences.
Retailers can also utilise digital wallets as a platform to deliver meaningful value-added services (VAS) that consumers can easily use. Consumers are motivated by VAS, but the complexities involved in activating coupons or redeeming points means that some $160 billion of reward currency lies dormant. By simplifying its VAS offering within a retail wallet, retailers can boost consumer loyalty, drive sales and get ahead of the competition.” André Stoorvogel, Director, Product Marketing in the Payments Group, Rambus
“By 2021, live video will account for 82% of the world's internet traffic, an important factor to consider for companies engaging with consumers. Online customer interactions with sales staff via live video will solve the challenge retailers have with high traffic websites that yield much lower conversion rates than instore visits. Importantly, it will also bridge the gap between the online and offline experience. People still like to buy from people. And, enabling online customers to buy from people, via their phone or laptop, at their chosen time and place creates a massive opportunity for retailers to help address the challenges of time-pressed consumers, enabling them to find what they need faster and more conveniently.” André Hordagoda, Co-founder, GoInStore
“In 2018 retailers will continue to focus on identifying the technology that will advance their business and allow them to connect with customers at a deeper level. Augmented Reality (AR) and Virtual Reality (VR) are going to become mainstream in 2018. Many of us have experienced AR on our phones and used a VR headset either at home or an event. However, next year this technology will transform the retail experience and bring consumers back to the high street without ever leaving the comfort of their own homes.
With high-definition photography and video now the norm, retailers will be able to combine these quality images with VR to create a virtual High Street store. Not only will consumers be able to see and experience what products look like with incredible detail, but retailers will be able to use advanced analytics to assess which products draw the most attention and how consumers explore the retail environment. Ultimately, this real-time information can provide retailers with a competitive edge and the ability to adapt quickly to consumer preferences at both an individual level - to understand how to deliver personalised recommendations and service - and at a macro level.
For consumers, this will also bring a new meaning to ‘try before you buy’. By using VR and AR to experience the product before it is purchased, consumers will be less likely to return an item that doesn’t match their initial expectations. AR and VR technologies will allow them to see the sofa in their living room before they buy or take advantage of a virtual wardrobe to decide if a pair of shoes goes with items they already own. The most successful retailers will be able to embed these experiences as part of their customer journey, rather than a standalone activation.” Chris Wood, Director of Retail, Salesforce
“As technology drives greater innovation and access to new products, the differentiator becomes all about the customer’s experience with the brand. We anticipate more and more retailers will increase their focus on creating omnichannel shopping experiences that are highly personalised, contextual and compelling. The focus will be on delighting customers at each point of interaction, regardless of channel.
With more shoppers engaging in an omnichannel process before purchasing, it will become increasingly important to integrate physical and digital retail experiences. Utilising new technologies such as virtual agents, mobile wallet payments, beacons, face and object recognition, magic mirrors, and smart shelves, will help provide richer customer experiences, drive more footfall to physical stores and increase sales conversions.” Scott Clarke, Chief Digital Officer and Global Consulting Leader for Retail, Consumer Goods, Travel and Hospitality, Cognizant