This is a post by Akshay Sachdeva and Francesca Nicasio.
The future of retail is something we think about constantly here at Vend.
And we know that a big part of predicting the future lies in looking at retail technology trends that are making waves today.
So for this post, we’ve compiled a handful of the top retail tech trends that are making their way into stores, ecommerce sites, and consumer’s homes. The goal here isn’t to hype up technology or convince you to adopt them all in your business. But you do want to keep these trends in your radar and determine if they’re worth investing in.
Let’s get into it!
Retail tech trend 1: High degree of personalization
Personalization in retail is more than just putting someone’s first name in an email blast. Various types of retail tech are enabling merchants to tailor everything from customer communications to product-building.
Here’s a look at how retailers are personalizing different aspects of the shopping journey. (Note: we can expect to see more of these in the coming years, so pay attention!)
All of the marketing and promotional communication that gets sent to customers will become more tailored to the consumer receiving it. In addition to addressing shoppers by their name, retailers can also customize the content of their communications based on each customer’s purchase history.
Here’s an email example from Lingerie retailer ThirdLove. With a subject line that reads, Francesca, we picked this just for you, the message showcases products that ThirdLove thinks I’d be interested based on the items I previously bought.
Some retailers are taking personalization to the next level by enabling shoppers to build their own products. Dresden, an eyewear retailer in Australia is the perfect example of this.
Dresden takes plastic waste from Australian beaches and discarded fishing nets and upcycles them into affordable frames. Then they let shoppers create their own pairs of sunglasses by enabling them to interchange the lenses and frame parts (which come in a variety of colors and sizes).
The result? Shoppers can purchase eyewear that’s unique, stylish, and environment-friendly.
With the use of beacons, mPOS (mobile point of sale), near field communication and Bluetooth technology, retailers are already able to greet customers by their name from the moment they walk in, and provide relevant information to the customer based on what they’re seeking. With targeted marketing messages and promotional pop ups appearing on screens in the retail store as the customer walks through, retailers will be able to attract, engage and convert prospects into shoppers.
What does this mean for you?
Whether you’re an SMB or a large retailer, you’ve got to work on personalizing the customer experience. Look at the techniques and technologies above and see how you can use them in your personalization strategy.
Does your email platform allow you to personalize communications at scale? Do you have the in-store devices to tailor the customer experience? What about product personalization? Are there any technologies you can adopt that can enable your customers to “build” products (if this makes sense for your business of course).
Explore the possibilities to see what works best for your business and customers.
Retail tech trend 2: Voice technology
With devices like the Amazon Alexa, Google Home, and Apple’s Home Pod, consumers will use voice search to browse and purchase products. Voice technology is also becoming more advanced on mobile devices, with applications like Apple’s Siri already blending AI and voice tech to become powerful personal assistants.
In a recent study, 57% of consumers who owned voice activated speakers bought something. That’s a clear indicator that voice based shopping is on the rise, and with over 20 million smart speakers now available in the US, this number is all set to grow rapidly.
And it’s not just about buying things. Consumers are increasingly using voice search to find nearby stores or to look up answers to their questions. Here are a few use examples of how voice impacts retailers.
- Scenario #1 – A dog owner who wants to buy pet supplies whips out her iPhone and says “find pet shops near me.”
- Scenario #2 – A lady who’s thinking about going to the gym wants to know the best type of leggings, so she turns to her Google Assistant and asks, “Ok Google, what are the different types of leggings?”
- Scenario #3 – A mom realizes that they’re almost out of toilet paper so she tells Alexa to place an order.
What does this mean for you?
In all these scenarios, merchants have the opportunity to put themselves on the radars target customers. In scenario #1, the retailers who have set up a proper online listing and optimized their site local search stand a good chance of being recommended to the searcher.
Meanwhile, in scenario #2, athleisure retailers can get on the radar of the would-be gym-goer by creating informative content on the different types of leggings.
As for scenario #3, merchants selling on Amazon can improve their chances of being recommended by Alexa by optimizing their listings and getting an Amazon Choice Badge.
The right voice search strategy depends on what and where you’re selling. But for many SMBs, the first step is usually to optimize your site for local and voice SEO. If you haven’t done so yet, you might want to consult with an SEO professional so you can get your site to show up on local and voice searches.
and you want to explore this trend further, here’s an interesting take on voice search from the folks at Goldman Sachs.
Retail tech trend 3: Artificial intelligence
We’ve already started to see how Facebook messenger chatbots are becoming the new customer service reps for many businesses. Many chatbots are powered by artificial intelligence and can be trained to answer questions and deal with certain customer requests.
Consumers, on their part, are starting to become more aware of chatbots. According to Ubisend’s 2017 Chatbot Report which surveyed 2,000 consumers, the “majority of consumers are aware of what a chatbot is (57%) and over a third (35%) want to see more companies using chatbots to answer their questions.”
Beyond chatbots, though, AI can also play role in the back office, allowing merchants to improve their operations.
For example, Vend retailers have access to Dott, a tool that can surface suggestions and tips to retailers based on their activity, in real-time.
Dott learns about you the retailer, and your business, based on how you use the Vend Platform day to day, and by analysing sales, product, customer and inventory information in real-time. It then makes personalized suggestions on what you should do next to grow your business, literally helping you join the dots. In its first iteration, this will include surfacing ways to engage with customers and keep them coming back, and how to best report on their inventory to keep the in products in stock.
What does this mean for you?
You can start thinking about how AI can be used in your business.
On the customer side, you can consider automating your customer service through chatbots on your social media channels. Try and think of ‘frequently asked questions’ by your customers and then build this capability into chatbots to free up your time, energy and resources for other meaningful pursuits, like innovation and new product development.
From the backend, you can start looking into AI-powered systems that can help you make better decisions.
Retail tech trend 4: Mobile
In the US it is predicted that more than half of all online shopping will be done via mobile phones by 2020. Physical retailers are actively trying to leverage this trend by providing mPOS (mobile point-of-sale) terminals to allow for quick checkouts.
Online retailers are customizing their shopping experience for mobile phones through building responsive websites that adjust their user-interface as per the device the consumer is using.
Not only are mobile phones going to become the preferred medium for users to shop online, they will also be the preferred medium to make ‘contactless payments’ in store. With technologies like Apple Pay, consumers will no longer be seen carrying credit cards in their wallets, and will opt to buy products using the digital wallets on their phones.
Building further on the ‘contactless’ in-store experience, Amazon has invented the “Amazon Go” store, which allows users with the Amazon Go app installed on their mobile phones to walk in store with a tap, pick up anything they like from the store, and then just walk out with another tap on their mobiles, without having to ‘pay’. This is going to become more commonplace at a lot of stores, with Amazon leading the way.
Mobile will also allow users to scan products, compare and make an informed decision on their purchases. More than 30% of shoppers said they had changed their minds about purchasing a product after consulting their mobile device while shopping in a brick and mortar store. Clearly, mobile phones are only going to further empower customers in the future.
What does this mean for you?
Think carefully about your mobile presence. Is your website optimized for mobile shopping? Do you offer a mobile app to your users to make purchases from? These are all important questions for you to address in the short term.
Over the long term, you’ll need to integrate mobile with other technologies to provide a frictionless shopping experience. With IOT, beacons, AI, machine learning, and contactless payments, the possibilities are endless on what you can invent for online and offline mobile shopping experiences.
Retail tech trend 5: The internet of things
The internet of things, a trend where physical things utilizing the internet to provide a seamless shopping experience, will completely revolutionize the in-store experience. It will bridge the gap between physical and digital shopping experiences.
As per a recent report, nearly 85% of retailers are expected to adopt IoT technology by 2019, up only from 57% today. IoT will have many potential applications such as:
- Video: With video analytics, and facial recognition technology growing in popularity, retailers will be able to build ‘shopper profiles’ from the moment they walk into a store. These shopper profiles will allow retailers to provide a highly individualized experience to consumers.
- GPS Enabled Shopping Trolleys: The shopping trolley of the future will allow consumers to upload shopping lists, with the trolleys then guiding them in-store with directions on finding the items they’re looking for. Customers will also be able to pay for these items via the trolley itself, eliminating the need to stand in line to check out.
- Electronic Rack Edge Tags: At the moment, retailers need to update prices on products being sold in-store with printed labels. This will change as retailers adopt electronic labels, allowing them to update all product information through the internet.
What does this mean for you?
The above is not a comprehensive list of all the inventions that IoT will catalyze for the retail industry. To prepare for the future, you need to consider the size of your store, and think about what technologies apply to your business. Consider how you can integrate IoT into your retail business to increase profitability, depending on what’s most accessible and viable for you.
Gear up for the future
Preparing for the future of retail requires a lot of contemplation, systematic planning, and empathy for the customer. With a ton of new technology trends disrupting the retail shopping experience, you have no choice but to take these trends in your stride as you look to build a sustainable retail business for 2018 and beyond.