From smart mirrors to in-car shopping: the tech shaping retail’s future
The retail industry is never stagnant. Rather, it is in constant flux, with innovations shifting the way that industry players operate, and changing the way that consumers and traders interact with one-another.
This can be seen by the adoption of QR codes – the use of which accelerated amid Covid-19 restrictions – self checkout in supermarkets and autonomous mobile robots, which are being utilised by major retailers for (among other things) logistical, supply chain and other inventory management tasks.
According to business futurist, speaker and author Gihan Perera, retailers should be on the lookout for technological advancements and innovations that can be used to improve performance, and enhance their efficiency and customer experience.
But, he said that retailers shouldn’t just be laser-focused on the technology. Rather, Perera believes that the right way for retailers to assess and prioritise these trends is to start with a customer-focused perspective.
However, he suggested a number of areas where retailers should consider investing in innovations in accordance with the priorities of their customers. A key one, he said, is personalisation, as the demand for a tailored and customised shopping experience becomes higher over time.
This is substantiated by Renaud Frisé, director of digital and technology for The General Store, who said that AI and machine learning technology can already create powerful personalised experiences for customers. He said that technological innovations are already offering recommendations and guiding online customers through the use of conversational chatbot interfaces.
From a back-of-house perspective, AI and machine learning technology is also able to power supply chain management and easily detect fraud.
“Every day, tech advancements are making it possible for more companies to easily access these tools and gather in-depth analytics on their businesses in the future,” Frisé told Inside Retail.
“[And] with the help of immersive technologies like AR and VR, there will be a reinvention of deep shopping experiences so customers can purchase products that best suit their needs and lifestyles.”
He used the example of an outdoor retailer of the future, which would allow customers to try on a ski jacket in a space that has been designed to smell, sound and feel like snowy mountains, with the help of sensory technologies.
“All of these experiences will lead to a decrease in returns and lessen the carbon footprint of businesses, as customers are empowered to make better purchasing decisions,” he said
In addition to AI and machine learning, Perera added the advancement of biometric identification technology, which would guide in-store sales assistants on the preferences of customers, based on their personal history.
Other technological innovations include virtual personal shoppers who can provide product recommendations, and 3D printing, which would be used to create customised products on demand. This, he said, would reduce waste, improve the supply chain, and design one-off products for customers.
“The scenarios are endless”
According to Perera, other key themes where technological advancements are set to enhance the customer experience include the convenience of shoppers, high end experiences and social engagement.
Regarding convenience, he observed that biometric payment technology – which would recognise customers when they enter, and charge them automatically when they exit – might create a more convenient shopping experience, especially among customers who are seeking less friction.
He also predicted that voice-activated shopping, AI-enabled devices like the smart fridge – which could automatically order groceries when supplies are low – and more customised and personalised subscription services might make retail a more convenient experience for shoppers.
Equally, Perera noted that customers seeking more friction and engagement – especially in luxury and premium experiences space – could potentially look forward to multi-sensory virtual shopping and haptic interfaces, which would provide a more tactile experience in the virtual world.
Further, virtual reality shopping could be used to allow consumers to walk through and purchase products in a virtual world, which could enable customers to upload their wardrobe and try on new clothes and accessories using a virtual avatar. Smart mirrors could also enable customers to try on clothes virtually, and see how they look from different angles.
Regarding the future of social and interactive experience, Perera discussed the prospect of social media shopping – where customers can shop together with friends and family – as well as fan forums, where communities can share the way they use products. Gamification techniques will also likely be explored by retailers to – among other things – further encourage customer loyalty.
Meanwhile, Frisé said that IoT technology would likely boost efficiency, and create more enjoyable customer experiences. For instance, he said that sensor-packed shelving would be able to track inventory levels in real time, reorder, or send an alert to the warehouse to refill stock.
He added that robotics are mostly used for back of house activities at the moment, but there’s huge potential for retailers in this space, once the technology becomes more front-of-house focused.
“These same robots could be connected to in-store analytics, inventory management system[s] and merchandiser plans all powered by AI. [These] automations [could] also take over in-store display technologies and content management systems to update in-store visuals and video content in real time,” Frisé said.
“The scenarios are endless. The technologies exist, the right tech stack just needs to be built for purpose.”
Shared values
Regarding sustainability goals, Frisé believes that emerging retail technologies can help to decrease return rates and make a big impact on an online retailer’s carbon footprint. He pointed to virtual initiatives being implemented by fashion retailers, such as AR try-on technology, which could lead to a reduction in waste through minimising incorrect purchases.
Smart building technologies that help to manage the lights and temperature of stores all managed by IoT and AI could also help decrease energy consumption, Frisé said.
“This would have a significant impact on retailers that have a large store network in particular,” he said.
“On the flipside, the computational power and resource intensive processors to allow optimisation has an energy cost, so IT and technology teams need to keep this in mind when making decisions.”
Perera added that the number of customers who care about sustainability, ethical and social justice goals would continue to grow, especially as the world feels the impact of climate change.
He said that younger demographics, in particular Gen Z and Gen Alpha – who are soon to become more prominent retail customers – will actively seek retailers who share their values. Millennials, which already make up a significant portion of retail spend, are already driving this change.
As such, he pointed to a number of technology advancements which are coming to the fore.
This includes (but not limited to) blockchain tracking – which can enable customers to trace the origins of products – zero waste packaging, biodegradable materials, sustainability apps and platforms and the sharing economy, which could see retailers share products, and allow customers to ‘rent’ them when unused or idle.
Further, he said that the public take up of the metaverse – a trend touted as a ‘game changer’ – was mostly low. He believes that retailers should wait for greater consumer acceptance before investing heavily in this area.
But, he stressed that there are still opportunities for retailers regarding the use of VR in other functions, such as training and assessment. Cryptocurrency is another technology trend that, he believes, is “mostly hype.”
“Some technologies will move faster than others. For example, AI was already a mature, proven technology that was largely unknown to the public until the launch of ChatGPT, which was the tipping point in its awareness,” he said.
“Now, all retailers will be incorporating AI into multiple parts of their business operations.”
More to come
Perera mentioned other retail-focused technologies that are either in trial – or discussed in some form – that might have potential, such as self-organising stores, augmented-reality contact lenses, and in-car shopping. But, he emphasised that these advancements were all highly speculative, and might account to little or nothing.
Perera added that there was a lot of potential in the retail technology space. But, for each retailer, he said that they should start with the customer and consider their wants and needs, before choosing and implementing the technology.
“Ask how the customer of the future is different, and then find the tech that supports them,” he said.
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