How retail tech will shape the way we future-shop
- The prevalence of technology will continue to grow and shape how consumers define shopping
- Retailers will turn shopping into an entertaining, exciting, and emotionally engaging experience by blending the physical with the digital
Technology is rewriting operating models across every sector of the economy, but nowhere will this be more tangible than in retail. As consumers, we see how our changing behaviors and preferences are reshaping the entire retail landscape. The pandemic’s disruption in particular has turned the sector upside down, bringing with it unparalleled tech innovations.
Therefore, technology should be a strategic imperative for retailers if they intend to remain relevant and profitable. The retail experience of the future will be propelled by both physical innovations and advanced analytics to meet changing consumer expectations while allowing retailers to reset their operating and revenue models.
A report by the Harvard Business Review indicated that today, e-commerce is well established and digital retailing is now highly profitable. “As it evolves, digital retailing is quickly morphing into something so different that it requires a new name: omnichannel retailing. The name reflects the fact that retailers will be able to interact with customers through countless channels — websites, physical stores, kiosks, direct mail and catalogs, call centers, social media, mobile devices, gaming consoles, televisions, networked appliances, home services, and more”.
There are a handful of trends that may have emerged out of necessity, but experts reckon they will continue to shape the retail industry in 2021 and well into the future.
Virtual fitting rooms
Gartner predicted the rise of augmented reality to 100 million consumers by 2020, and was proven correct. In 2020, the customer conversion rate for AR engaged users increased by 90%. The potential of augmented reality in the retail space cannot be ignored in 2021.
Virtual fitting rooms utilizing augmented reality technology is one of the most intriguing innovations in the retail industry. Since the “try-before-you-buy” approach is difficult during a public health crisis, augmented reality is in the unique position to help customers make choices on what to purchase by virtually ‘trying them on’.
Where many other retailers saw losses in the face of the pandemic, Sephora saw great gains with its use of augmented reality technology in 2020. By using virtual fitting rooms, customers could ‘try on’ their products like jewelry and cosmetics with their smartphones. Other retailers such as Kendra Scott and Etsy are also utilizing virtual fitting room technology.
Staff-free and cashier-less stores
Given how social distancing is still relevant for protecting public health in 2021, cashier-less and staff-free stores are an important retail trend to consider. In fact, many customers have, since last year, shown more interest in stores with contactless or self-checkout options.
To achieve the contact-free goal, RFID tags, computer vision systems, machine learning, IoT devices, and facial recognition can be utilized. Technologies like these were harnessed in Amazon’s Just Walk Out system, powered by their Amazon Go Grocery model. In particular, the project took advantage of computer vision, sensor fusion, and deep learning. Amazon’s IoT network in the store tracks what consumers place into their cart. When the customer leaves the store, the store will automatically charge the credit card that the customer has on file.
There are also ways to reduce cross-contact in stores by customers scanning barcodes and QR codes for prices and to make payment. The codes can be scanned by consumers’ smartphones to gain additional information about items without having to touch them to inspect them.
Artificial intelligence and neuro-linguistic programming (NLP) have continued to advance in 2021. With Google Assistant, Alexa, and Siri as the main frontrunners of the consumer voice assistant market, various improvements have been made by each to better serve customers.
With the United States expected to have more than 77 million homes with smart home devices in 2025, the voice commerce trend is proving to have serious potential for the retail industry. IoT devices in consumers’ homes, such as smart mirrors and smart displays can help deliver product content in non-intrusive and helpful ways.
Voice commands can help customers find products or even make purchases. Walmart’s Voice Ordering service is a perfect example of this technology in action. By asking smart speakers to add products to a cart, they can place orders entirely by voice. Those items can then be made available for pickup by Walmart’s workers.
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