How Technology Has Radically Transformed Retail
Retail no longer solely means walking into a store or going to a website when searching for something to buy. The “if” factor of finding desired products is now “when” and “how,” and the possibilities for purchase are endless. Today, retail is about the experience — finding the best price, shopping in your preferred mediums, accessing in-store conveniences like buying online/picking up in-store, etc. Regardless of the experience, technology plays a significant role in how and where we shop, and it will continue to drive innovation across the industry.
This was confirmed after attending the National Retail Federation Big Show this past January in New York, as it was evident how far retail has evolved. There were demos of self-checkout kiosks, tech-infused pop-up shops, point-of-sale systems that improve customer service, and more, in addition to the continuous growth of more advanced smartphones and social platforms that have increased engagement and modernized the shopping experience. While each trend has impacted retail in its own unique way — whether it be online or in-store — many share common themes on how technology will continue to drive retail experiences.
Retail is Sensory Driven
Our senses navigate us through our daily lives; retail is no different, with voice and visual commerce being two of the driving forces. Voice assistants like Amazon.com's Alexa, Apple’s Siri, and Google Assistant have created a new era of retail, and we’re just at the forefront. In fact, management strategy consultants OC&C estimate an astonishing $40 billion will be spent on U.S. voice commerce by 2022, with 36 percent of device owners regularly using them to make purchases.
Visual commerce allows the abundance of images and videos that we see online every day to become shoppable, instantaneously turning inspiration into reality. Today, there are 600 million visual searches every month across Pinterest through its Lens tool, a direct result of more than 85 percent of consumers putting more emphasis on visual information than text when shopping online. While voice and visual commerce are both already very relevant today, over the next few years we’ll see more brands redesigning their websites to support these trends further.
Increased Personalization Strategies
Time has become a scarce commodity for the modern shopper, therefore, buyers value brands that immediately and directly appeal to their individualized needs. This makes personalization tactics more important than ever, especially in advertising. Ads that are served across all devices need to be aligned with shoppers’ current interests. This strategy can be accomplished through artificial intelligence (AI), as the technology can analyze browsing history to determine “things we may like” and make data-fueled predictions on what may be searched for next.
Convenience also plays a big role in personalization. The moment consumers see something online or in person that inspires them, they want to leverage the resources at hand (i.e., their smartphones) to find the product immediately. Fortunately for consumers today, these visual search capabilities are being built directly into the cameras of smartphones, allowing them to purchase products anytime, anywhere from a device that’s already natural to them.
Reimagined In-Store Experiences
Traditional retail has undergone radical changes, transitioning from inventory-led to frictionless, experiential environments. Despite some beliefs, brick-and-mortar will likely never go away regardless of the surge in e-commerce. Therefore, brands and retailers are left to take more innovative approaches that merge offline and online experiences to give consumers the best of both worlds.
Today, we’re surrounded by cashierless checkout, pop-up stores, interactive smart mirrors, data-driven merchandising, and more. We’re even seeing scan-and-go capabilities where consumers can scan the barcodes of every item they put in their cart with their smartphones to gather product information like price, nutrition facts, and more. What’s even better? When consumers are ready to check out, they can pay using the app and leave the store — which also plays well into the convenience factor outlined above.
Overall, retail is a rapidly evolving industry consisting of many segments that are both digitally and physically transforming with new innovation. Much of this transformation is made possible through emerging technologies like AI and the abundance of data that's available today. And when you combine technology and data, you get a relevant and efficient shopping experience — something that today’s consumers crave.
Oliver Tan is the co-founder and CEO of ViSenze, a company that provides artificial intelligence-based visual search and image recognition solutions that help retailers improve revenue and conversions.
Related story: The 2018 Retail Technology Report