Top Five Digital Transformation Trends In Retail ~via @danielnewmanUV
This week, I launched a new series focused on the biggest digital trends impacting various industries. First up was healthcare, where technology is gifting patients with greater access to quality care through telemedicine—and arming caregivers with even more life-saving tools like wearables, predictive data, and the Internet of Medical Things (IoMT). Now we move to retail, where a similar wave of empowerment has hit the industry—this time, on the side of consumers.
Whether retail is ready for it or not, consumers have become hooked on the real-time, personalized world of the modern digital landscape, and they expect their retail providers to follow suit. Today’s digital consumer is a demanding beast. They want what they want, and they want it now. (And that’s just today’s shoppers; don’t even get me started on Generation Z, which is actually expected to become the next big retail disruptor.)
Today’s retailers have never had more demands—or more opportunities—to reach their customers in new and exciting ways. Retailers are no longer selling things. They’re selling the experience of buying those things. And it better be a good one. Says one writer, “We can no longer be a little bit digital.” It’s an all-or-nothing train, and retails who refuse to hop on now will be left behind. The following are a few of the biggest technologies currently impacting the industry.
Mobile
I still remember the first time I learned I could walk up to any associate—literally anywhere in Nordstrom Rack—and pay for my purchases. Now that seems like old hat, with Amazon Go offering customers the chance to purchase items without checking out at all. Today’s opportunities in mobility run the gamut from mobile-armed sales staff to mobile-enhanced product reviews, mobile-responsive websites, and discounts on demand via apps while shopping in store. A recent study showed 82% of smart phone users consult their phones in the store while deciding what to buy. It makes sense that those shoppers can now use mobile pay—from a growing number of providers—while they’re at it.
Mobile wearables are also shaking up the digital world. Now customers can walk stores with virtual reality (VR) goggles and try on items without ever touching them physically. Not only is it faster and easier—it’s fun for the customer, and one more way to get him or her in the digital or physical door.
Smart Beacons
Another smart way to capture customers: smart beacons. Smart beacons work with Bluetooth to alert retailers when customers are in the vicinity of their store or signage so they can communicate with them at a targeted time or range. In fact, smart beacons take targeted marketing to a whole new level. What better time to send a customer a coupon or discount code than when they’re standing outside your door?
Smart beacons also allow for immediate data collection to determine the effectiveness of one’s marketing campaign. Do promos usually work better at a certain time of day? Among certain age groups? With certain product types? With smart beacons, retailers no longer have to guess—or devote tons of time, money, or analysis—to finding the answer.
IoT
I don't think a digital transformation article sans Internet of Things is acceptable these days, so I'm including it, but not for that reason alone. With 6.4 Billion IoT devices currently and an expectation of more than 50 billion by 2020, much like the smart beacon, all of the data that is being produced from our "Things" will become high impact consumption data that retailers will be able to utilize to personalize shopping experiences and put the right products in front of the right people at the right time.
Artificial Intelligence
We can’t mention data collection without also mentioning artificial intelligence (AI). Grounded in both big data and automation, artificial intelligence is allowing retailers to understand their customers’ personal preferences and anticipate their needs and purchases before they do themselves. And in today’s world, retail is all about personalization. AI is the powerhouse that recommends products you might like to try … sends coupons for things you’ve already purchased … and in some cases, even redesigns entire web home pages instantly based on user social media profiles. AI also allows for even more streamlined loyalty programs, replacing archaic and clunky human tracking systems with real-time sensors and buying history to reward customers for loyalty as soon as they click “buy now.”
That’s not all. In the future, AI will likely replace human consultants in the retail world. Shoppers will no longer waste their time searching for an expert on the floor. AI can be an expert in everything, helping shoppers find exactly the product they need, be it the right wine for dinner, the right computer for their profession, or the most flattering clothing for their body type.
Virtual And Augmented Reality
One of the biggest hurdles of getting customers to buy online is that many shoppers prefer to hold, touch, or try on their purchase in real life. Both VR, mentioned briefly above, and augmented reality (AR) are helping to close the gap on that problem by empowering consumers to “experience” the object without ever holding it in their hands. While many consumers still lack access to VR or AR tech, it’s clear that the technology holds tremendous potential, especially for those who live far away from the object they are hoping to purchase. Imagine test driving a car or purchasing a new home without ever even stepping inside. VR will make it possible.
As with every industry in this era, it’s important for retailers to embrace change. Not all technologies will be right for their product or clientele, but if they design a flexible digital strategy, they’ll be better equipped to try new technologies as they come along—which is, essentially, exactly when their customers want them.
In the interim, we’ll likely see many retailers continue to struggle with an “omni channel” existence, trying to determine the perfect balance of physical presence and digital touch. It’s not a new problem, but it’s one that will continue to evolve in challenging and exciting ways as the digital transformation continues to unfold.
