Retailers are increasingly turning to technologies like artificial intelligence, AR/VR, robotics, and holograms to provide enhanced, hyper-personalised customer experiences
- How AR is changing the way we shop
- Hyper-personalising the customer experience
- Are chatbots and holograms the future of customer interaction?
- Boosting conversion rates with ultra-channel marketing
- How will we pay for our purchases in the future?
- The transformation of inventory management and last-mile delivery
- How does technology impact the retail workforce?
The future of retail is in the hands of ‘extreme digital’. Virtual reality and 3D printers will enable the fusing of perception, personalisation, and on-the-spot production. Intelligent systems will take the place of cashiers and more and more smart products will independently find their way to the consumer. Offline and online shopping will merge into a captivating world of immersive experiences.
The future of retail is shaped by impressive technological developments. Think delivery drones and robots that manage the stock. We will pay with a wave of our hand and product offerings will be personalised and presented virtually. Shopping bots will manage the needs of the customer of the future and connect to numerous systems in the background. Are you ready for a future of digital shopping experiences?
How AR is changing the way we shop
What will the store of the future look like? Will we only buy online and cause physical stores to disappear altogether? Or will shops turn into multi-purpose, multi-experiential spaces that make clever use of VR and AR to wow customers into buying their products? Perhaps the shop of the future is mobile, autonomously driving to your doorstep for out-of-this-world convenience. Most likely, the shopping experience of the future will be a combination of all of the above – and more.
In 2019, the Italian furniture manufacturer Natuzzi opened a new retail store in New York, using technologies like augmented and virtual reality, holographic displays, and advanced 3D modelling to provide an engaging and exciting shopping experience. Located on Madison Avenue, the Natuzzi Augmented Store allows consumers to explore the brand’s entire catalog in a virtual environment. While wearing a headset, customers can customise any product according to their taste by changing the colour, finishes, and materials until they are satisfied with the end result. Using photographs, measurements, and CAD files, Natuzzi then produces a 3D rendering of the customer’s home and decorates it with the chosen pieces in the 3D configurator. Customers can walk through the scaled model and examine it from every point of view.
Before leaving the store, they will also receive a 360-degree rendering, which they will be able to browse on their phones and take home to show to their families. “Using cutting-edge technology, we are able to tell the Natuzzi story, and to create unique one-to-one relationships. This experience of our product in such a creative way will hopefully allow the consumers to fall in love, join the Natuzzi family, and keep coming back. This technology not only provides something experiential and memorable, but is also designed to enhance and facilitate both the browsing and purchasing experience,” says Pasquale Junior Natuzzi, creative director at Natuzzi Italia.
FaceCake, a leading developer of AR solutions for retail, unveiled a new feature for its AI-driven platform that promises to take shopping to the next level. The Augmented Realism feature will enable retailers to create incredibly lifelike models of products like jewellery, eyewear, and fashion, bringing them to life in a way that has never been done before. The platform uses AI to recreate natural product movement, taking into account product weight, dimensions, and physics. Furthermore, reactive lighting virtually tracks the surrounding environment and produces an accurate reflection onto each product.
This way, consumers can, for instance, clearly distinguish each individual lash in a set of silk eyelashes. Virtual earrings that they try on will move and sway as if they were real, their finishes shining in the room’s actual light. The same is true for eyewear. As consumers turn their heads while wearing sunglasses, the lenses and material finishes accurately reflect true light, resulting in a more immersive and frictionless shopping experience. “The consumer of today has grown past a filter. They want (and deserve) more,” says Linda Smith, the founder and CEO of FaceCake. “Our Augmented Realism, coupled with our industry leading AI, brings the most elevated AR shopping experience possible to all consumers from wherever they are seamlessly, whether they are shopping online, mobile or in-store.”
Hyper-personalising the customer experience
Shopping will become increasingly personalised. Think in-store VR/AR promotions, interactive displays, smart mirrors in fitting rooms, and AR-overlaid product information. Smart systems will recognise and greet you by name as you enter the store, guiding you to all the things they know you will like. A 3D printer will print your perfect, tailor-made product while you wait. Snapchat-type apps will enable you to ‘see it, snap it, shop it’ (even ‘print it’) – offline as well as online. Excited yet?
The online luxury fashion retail platform Farfetch recently unveiled a beta version of its Store of the Future that will provide consumers with a unique, highly personalised shopping experience. Located in New York, the store will fuse online and offline experiences through a combination of augmented reality, emotion-scanning software, and innovative payment solutions. In addition to improving the physical shopping experience and strengthening emotional connections, this technology will also enable the retailer to collect valuable data on customer behaviour. When they walk into the store, customers will be able to log in through a scanner, allowing sales assistants to see their profiles, along with their purchase history and wishlist. Any items customers pick up will be recorded by the connected clothing rack and stored in a smartphone app for them to review later. The store will also feature a smart mirror that will enable customers to try out items in different colours and sizes, find alternative options, and even pay for their purchase right there in the dressing room. Another interesting feature is a holographic display that allows customers to create customised shoes by experimenting with different colours and materials, and order them on the spot.
Ruti, the luxury fashion brand aimed specifically at women of 35 and over, has developed an AI-powered platform that uses facial recognition technology to provide a hyper-personalised, streamlined in-store experience. When a customer walks into a store, a series of cameras scan their face (provided they have opted in, of course) to identify them and pull up their profile. Then, based on their purchase history, items they’ve tried on in the past, fashion preferences, feedback, size, and other attributes, the system offers personalised product recommendations from the most recent Ruti collection. “When customers come into the store now, we can recognise them and we will have all this information that tells us this customer, for example, hates fitted tops or clothing — she just likes everything loose,” says founder and CEO Ruti Zisser. “She loves to buy more colourful apparel, or even wants to gain approval from a friend due to her styling choice. We look for any information that can make the customer feel more comfortable about their purchase. It just makes the lives of everyone that works for Ruti much easier, and customers feel much better.”
Are chatbots and holograms the future of customer interaction?
Online, you will likely come across interactive, conversational chatbots that know all your likes and dislikes and make spot-on suggestions. They do this by tracking your browsing patterns and learning as you type, pause, watch, and scroll. Browsing will become increasingly voice-empowered. You’ll be able to visit virtual showrooms, where VR/AR tech will enable you to try and experience whatever you’re interested in buying. Hologram prototypes will show you the progress of your product being created.
According to a recent report published by Juniper Research, consumer spending via chatbots is projected to grow from $2.8 billion in 2019 to $142 billion in 2024. The London-based fashion tech startup Intelistyle has developed a fashion stylist chatbot that uses artificial intelligence to help you find the perfect outfit for any occasion. After asking you a series of questions, the chatbot generates new outfit ideas that combine items from various fashion retailers and those you already own. Overall, it takes into account 256 different style parameters to make these recommendations, including your body type, hair, eye colour, skin tone, and personal preference, as well as the latest fashion trends.
Using deep learning algorithms, it analyses thousands of outfits put together by stylists, designers, and influencers to learn what makes seemingly incompatible patterns or fabrics come together to form a beautiful outfit and how to use accessories to combine two pieces of clothing that wouldn’t be a good fit otherwise. “Currently retailers use studio shots to inspire customers and showcase outfits. It’s an expensive process that results in one outfit per piece of clothing that’s suitable for just one body type and skin tone. Intelistyle’s technology allows retailers to scale their personal styling services and celebrate diversity by showing each customer outfits that meet their exact needs,” says Intelistyle CEO Kostas Koukoravas.
Asda, one of the largest supermarket retailers in the UK, recently introduced 3D holograms to its store in Stevenage. A total of 15 holographic projectors have been installed at three different areas within the store, where they advertise products, highlight seasonal activity, and inform customers how to use the supermarket’s Scan & Go service. “We are excited to be one of the first retailers in the UK to test out the 3D holograms in our store, which are projected in the air to showcase products and provide customer information,” says Michael Rose, who leads the team in charge of the project. “They are currently in place in our bakery department, seasonal aisles and on Scan & Go points and are proving very popular with customers. They are very eye-catching and the clarity on them is brilliant, which customers seem to love. The whole idea of the test is to collect feedback and gather views and from what we’re seeing so far, it is all very positive.”
How to boost conversion rates with ultra-channel marketing
Marketing will become increasingly personalised and immersive, reaching potential customers in mind-blowing ways. Think VR, AR, interactive signage, and chatbots. You’ll receive tailor-made offers via an app, smart TV, email, or your smartwatch. Because algorithms can recognise and predict behaviour, every visitor will get to see his or her own environment. ERA – Emotion Response Analysis – uses EEG tech to measure your emotional response to online products or digital advertising. Marketing will never, ever, be the same again.
Amplify.ai, the California-based startup behind the first AI-based conversational platform aimed specifically at the retail sector, recently established a partnership with the conversational advertising platform AdLingo that will enable it to provide brands with innovative display ad experiences. Using Amplify.ai’s platform, brands will be able to effectively drive user ad engagement via two-way, natural language interactions with consumers. The platform combines a common machine learning/AI foundation with a sophisticated natural language processing system and an abstraction layer that supports any arbitrary conversational surface to enable persistent conversations across all major communications channels. It also allows seamless switching between different modalities, allowing consumers to start a conversation on their desktop computer, for instance, and continue it on their mobile device without any interruptions or loss of context. “Truly conversational interaction is a game-changer for display advertising, enabling deep and effective engagement directly within the ad experience,” says Mahi de Silva, the CEO and co-founder of Amplify.ai.
The Seattle-based retail technology company Stackline recently launched a new intelligent advertising automation tool called Ad Manager, which will enable retailers to create, execute, and analyse effective e-commerce advertising campaigns using real-time bidding, competitive advertising, profitability, conversion, and incrementality data. Once retailers enter parameters like budget, goals, and dates, Ad Manager leverages machine learning technology to scan billions of data points and identify opportunities to improve performance and make the campaign more effective. It makes thousands of real-time campaign optimisations every day to ensure success and offers recommendations regarding content, keywords, and targeting. It also helps retailers identify and reach new customers and provides a forecast of the campaign’s projected spend, sales, and ROI. “Advertising should be data-driven, optimised and intelligent. With Ad Manager, we’re providing an unprecedented look and access into a market that’s moving billions of dollars,” says Michael Lagoni, CEO of Stackline.
How will we pay for our purchases in the future?
In the future, we will pay with a swipe, transfer money with a heartbeat, or confirm payments with a smile or iris scan. In the background, business systems will automatically carry out all kinds of processes. We will also be able to pay with our self-driving car or personal wearables. According to a new report published by Grand View Research, the global digital payments market will reach a value of $132.5 billion by 2025.
Amazon recently submitted a patent for technology that uses hand recognition to identify customers and charge for the items in their cart. The patent describes a contactless biometric system that uses a special hand scanner equipped with an infrared light source, a controller, and a camera to capture images of a customer’s palm. It then compares surface characteristics such as wrinkles in the palm and veins against images already stored in the database to confirm the customer’s identity. This would allow customers to pay for their purchases by simply walking up to the checkout terminal and waving their hand over the scanner.
However, it will be a while before this technology becomes reality, as it’s in very early stages of development. Nevertheless, Amazon has already approached Visa and Mastercard to collaborate on the system’s development and even plans to offer it to other brick-and-mortar stores, as well as coffee shops and fast-food restaurants. According to the New York Post, the system can verify a customer’s identity in just 300 milliseconds. Furthermore, unlike fingerprint technology, it doesn’t require customers to physically touch the scanner, which could be of crucial importance in the post-corona world.
How technology is transforming inventory management and last-mile delivery
We will be moving from ‘next day’, to ‘same day’ and finally to ‘real-time delivery’. In the world of tomorrow, drones will deliver within a few hours and if you want, 3D printers can even ensure real-time delivery. Autonomous robots will take care of inventory tracking in stores and warehouses. Blockchain-based platforms will reduce costs and enable consumers to trace product origins and authenticate luxury goods. Warehouses will become increasingly human-less with automated inventory robots and intelligent picking processes doing what needs to be done – fast. Packages will be fitted with sensor tech and GPS to monitor their exact location at any given time.
Retail giant Walmart recently announced plans to introduce shelf-scanning inventory robots to another 650 locations across the US, bringing the total number of stores equipped with this technology to 1,000. Developed by the Bay Area-based robotics startup Bossa Nova, the 1.8m tall robots roam the aisles and scan shelves to find out-of-stock, mislabeled, or incorrectly priced items and pass the information to a central computer. However, as the robots still cannot restock the shelves themselves, that task is entrusted to a human employee.
UPS recently partnered with the retail and healthcare company CVS to launch a residential drone delivery service in Florida. Starting from May, residents of The Villages, the largest retirement community in the United States, will have their prescriptions delivered to them by UPS Matternet drones. The drones will bring packages to a drop-off point located outside the community, which will then be taken over by manned ground vehicles to complete the delivery. “Now more than ever, it’s important that our customers have access to their prescriptions,” says Jon Roberts, executive vice president and chief operating officer of CVS Health. “In addition to our in-store pickup, free delivery services and drive-through pickup, this drone delivery service provides an innovative method to reach some of our customers.”
The impact of technology on the retail workforce
The marriage between technology and retail will redefine roles and skills. A recent study estimates that nearly half of all jobs in retail could be lost to automation over the next decade. Many cashiers and shop assistants will be replaced by their digital counterparts. Instead, retailers will want to hire brand ambassadors and experts like marketing analysts, specialists in AI, VR/AR, social media experts, and people that create compelling interactive content for real-time digital storefronts and online shopping platforms. Important future skills in retail will include teamwork, digital and analytical skills but also interpersonal skills, initiative, communication skills, and adaptability.
The retail industry is undergoing a major transformation driven by new technological developments. As consumers increasingly turn to online shopping, providing them with unprecedented speed and convenience, retailers are starting to adopt innovative technologies like artificial intelligence, AR/VR, holograms, robotics, and drones in an attempt to differentiate themselves from their competitors and meet increasing customer expectations. From AR-based virtual showrooms and AI fashion stylists to inventory management robots and delivery drones, technology is set to play an increasingly prominent role in the retail industry over the next couple of years, forever changing the way we shop.