Cars, smart fridges, and personalised pricing: What’s in store for the future of retail?
The way retail exists today looks very different to how it did 10 years ago. With this in mind we decided it was time to rip up the rule book and explore new ways that retailers can engage with their customers, both in stores and online.
At our recent Trust Talks: Future of Retail event, we sat down and quizzed three experts from the retail space; Elena Corchero, Futurist at Unruly, Ricardo Varela, CEO and Founder of Localistico and Joshua McBain, Director of Consultancy at the Foresight Factory.
A recent report states that over the next 20 years, between 50% and 75% of transactions will be going globally through the Alibaba, Walmart and Amazon platforms. With this in mind, what opportunities are there for retailers to carve a niche as we see consumer behaviour is changing so greatly?
Joshua McBain (JM): The type of impact that these changes will have on different brands depends on their customer groups, and the type of loyalty that they invoke with their customers. The key thing to understand for brands in this space is what the impact is going to be on your brand vs other brands based on your type of loyalty, positioning, and what you sell.
Ricardo Varela (RV): If you look at Amazon, they have recently done a lot of work with the Whole Foods brand by bringing it into the digital space. Going forwards, brands are going to have to decide the best way to reach their consumers, whether that be through digital channels, through physical stores, or through a combined outreach.
Elena Corchero (EC): Looking to the future, I wonder whether Brexit will change the availability of people that work within the delivery space. I also think that driver-less cars will bring about a real change in terms of shipping costs for retailers.
Thinking about Amazon, Alibaba and Walmart, a huge part of their future growth will revolve around voice. How can you see voice helping other retailers, and what opportunities does it present to them that we aren’t currently thinking about?
EC: I believe the car is going to be the biggest driver of voice command over the coming years. Using voice commands to carry out actions whilst you are driving is a necessity compared to when you are at home, where you have the choice to use voice or type in the command to your phone.
The main way voice will impact retailers through car is via impulse purchases. If we think about KitKat, previously they relied on consumers who were away from the home seeing or hearing an advert, remembering it, and then going out of their way to find somewhere that sold it. Whereas now you can take instant action by saying add to basket whilst you are driving, and by the time you get home the KitKat might be there.
JM: What I think is interesting is the innovations that Microsoft are leading on, which is allowing brands to tailor their tone of voice depending on what service it’s coming from. For example talking to your BMW should sound different than if you were to talk to your Amazon Echo. Consumer’s don’t expect every service to sound the same and many brands are now becoming aware of that, and are starting to act upon it.
If you are a global retailer, how are you able to consider new trends and technologies to engage with your customers at a local level?
RV: Working at a local level is extremely important within the retail sector. Looking at Morrisons as an example, they have created creches in their stores that are located in areas where a lot of families live. Apple also state that each of their stores are unique, and what is in each store is different depending on where it is based.
It’s also important to use the technologies we have to communicate with customers by letting them know what services are available to them. A lot of the time brands will offer additional services like an in store creche, but people will not know about it because the brand has not done a great job of communicating it to their local audience.
“Where marketing starts and e-commerce ends is becoming increasingly blurred”
Is there a way that advertising can add real value, and become part of the end to end consumer experience within the media space?
EC: At Unruly we are studying this within the Home. Over the past year we have learnt that one of the advantages of advertising through the IoT, through voice, and through immersive technologies like VR in the home is that it all becomes part of this ambient era of advertising. Going forward this will hopefully help consumers to see advertisements as adding value to their lives rather than seeing them as interruptions.
JM: Where marketing starts and e-commerce ends is becoming increasingly blurred and I believe that we will see this continue as big social channels like Snapchat and Instagram become more and more shoppable. Social channels will become a great way for brands to work on a much more personal level with their customers, and will give them the ability to personalise their products and prices depending on the customer they are targeting.
We are looking to a world where most services will become automated. My fridge will be able to scan my items and automatically replace them so that I never run out of anything. With this in mind, does that mean that retailers are in danger of becoming more like logistics companies?
EC: I think it’s an advantage as having all that data and machine learning will allow companies to know exactly how much stock they need to hold in different areas.
What is also exciting is the way that AI will work within these situations. For example with the fridge, it could recommend different recipes that it thinks you would like depending on the foods that you enjoy eating on a regular basis. In order to complete the recipes you may be required to order in new ingredients which then opens the door up to new food brands.
This Q&A was held at Unruly’s Future of Retail event in London. To see any of the insightful presentations available from the event, click on any of the below links to check them out:
“How to empower brands in the home of the future”, Elena Corchero, Futurist, Unruly
