- Virtual Shops
- Mobile applications to assist in the buying process
- Cloud banking
- Digital payment methods
- The digital wallet
- Facial recognition prevents theft and makes shopping more relevant
- From Multi Channel to Omni Channel retailing
- Tailor made shopping
- Retail and 3D printing
- Drones will deliver your package
The future of retail is downright fascinating and ambitious. New techniques enable retail to rapidly develop into something that we can hardly fathom. But it’s coming fast and furious. In 2030 we will be trying on clothes from behind our laptops in virtual shops. We then pay for them and print them out on our personal 3D printers. With the ten examples below I will give you my vision of the future of retail.
There you are again, walking around in the same shopping centre in your own town. You’ve already visited each and every shop but you still haven’t found the right pair of trousers. If you can’t find them in the Netherlands, why not browse around in Madrid, New York or Shanghai? This is all possible in the virtual shop. You can easily open up three screens in your browser and shop in three cities at the same time. The advent of virtual reality will make virtual shopping an even more realistic experience. You walk, virtually, through the stores and you feel the atmosphere of real shopping.
In 2011, the British company Tesco was the first in the world with a shop at the departure lounge at Gatwick Airport. From a large screen, customers were able to choose from various essential products such as bread and milk. They scanned the barcode with their phone, paid, and while they were in mid-air, their groceries were already waiting on their doorstep. But of course, that is already ancient history. With the advent of the Oculus Rift, Tesco saw new opportunities and with a virtual reality supermarket they took grocery shopping to a whole new level. The brands on sale at Tesco are part of that virtual reality. After your grocery shopping, they will invite you to play a round of football against the Brazilian football legend Pélé. Who doesn’t want that?!
Mobile applications to assist in the buying process
Imagine. You and your partner go looking for a new sofa and before you leave, you take a picture of your lounge. In the furniture store you see the sofa you’ve always wanted. But you wonder whether it actually fits in with the rest of your interior. You then take a picture of the sofa, swipe over your screen and your sofa is standing in your lounge. This technology will be used within many retail categories and will assist you when you want to buy trousers, paint for your house or a new carpet for your lounge. With these applications we can add value to the store visit and allow both channels to reinforce each other.
Pay underway’ is a hot item and in order to further develop this, cloud computing is essential. By storing everything in the cloud, there is less paperwork and fewer people are needed to handle the administrative work. When it comes to innovations, banks are at the back of the line. Security, processes and the huge number of decisions makes it almost impossible for banks to keep up with the continuous flow of innovation. Added to that, change doesn’t fit in with the DNA of the bank. Apple Pay and Google Wallet are overtaking the banks with high speed. With their own payment systems they will take over a huge part of the payment market in the next few years. Is the end of the traditional bank in sight? One bank who saw added value in cloud computing a few years ago was the Zitouna Bank of Tunisia. Half the population of Tunisia has no access to the Internet and a quarter don’t even have bank accounts. In order to realize plans for expansion (giving more people access to the Internet and to provide people with bank accounts), they moved to the cloud.
Digital payment methods
New payment methods are emerging. One such new payment method is the bitcoin, with which we can already pay at many places in the Netherlands. Such digital payment methods are known as ‘decentralized’. This means that there is not just one ‘watchdog’ guarding the market and determining the value of this method or deciding how many can be in circulation. Digital payments will make our lives easier and solve problems. The democratization of money is underway.
The digital wallet
Apple and Google already have one. Digital payment methods that enable us to bypass banks. Both brands are busy rolling out these systems all over the world. The ‘old fashioned’ wallet will disappear off the scene. Digital payment methods are not only used for payments. In the future, these ‘wallets’ will give you tips based on your buying behavior, your location and your friends. Big data will also make an entrance here. I also predict that the digital wallet will start playing a part in recognition, access and other forms of authentication. Apple and Google are investing heavily in this technology for a good reason. Having a level of control over people’s daily expenditure and movement is a powerful tool with which to influence the consumer and the economy. It is important to get a response to this from worldwide governments. According to a recently published Technology, Media & Telecommunications Predictions study by Deloitte, the number of in-store mobile payments will see a 1,000% increase this year compared to last year. Up until now, customers haven’t yet found their way to the digital wallet and this is largely due to the fact that people are still satisfied with their ‘old fashioned’ wallet and are ‘anxious’ about using just a digital version.
Facial recognition prevents theft and makes shopping more relevant
One of the advantages of the digital revolution is that it gives shop owners the ability to recognize customers and the option to refuse them access. The latter in the event that they are registered offenders and/or charged with theft. Detecting age, gender and specifics about people opens up opportunities for offline, online and mobile interaction. If you enjoy being addressed, why not preferably on the basis of available information?
From Multi Channel to Omni Channel retailing
Omni channel retailing is the superlative of multi channel retailing. With multi channel we deploy various channels to reach diverse groups of customers in a different way. These days, we are dealing with the ‘connected customer’ who wants to communicate via mobile, social media and many other channels. Gone are the days when the retailer determined the communication channels. Big Data is the basis of the omni channel approach of the future. The connected customer, as described above, is active on various channels simultaneously. To be a player in the 24/7 available & reachable market, you need to influence connected customers with an individual experience; provide the right person with the right content at the right moment, via the right channels. A concept that, just a few years ago, still seemed ‘utopian’. Structured data, generated within the right channels, will give CMOs (Chief Marketing Officers) faster than real-time insight into the purchasing and surfing behavior of their customers. These insights enable machines to make better decisions and even to make predictions. Not the ‘gut-feel’, but data is the deciding factor. Because real time channels can be deployed and retracted based on smart data, less money is wasted.
A good omni channel approach that is structured on the basis of the right data can eventually encourage more clients to come to the physical stores to spend more. My prediction for the next 15 years is that the brick and mortar store won’t have to disappear from the scene at all. But the function of the store, its service levels as well as its product range will be a deciding factor.
Tailor made shopping
People no longer visit a store because of the lowest price or the best range. There are better and cheaper alternatives to be found online. People enjoy visiting a store because of the ‘experience’. Buy what you want, when you want. ‘Sold out’ doesn’t exist anymore.
In the future, predicting consumer behavior will be as easy as predicting the weather. This is all possible because of the increasingly smarter supply chain. The traditional supply chain will cease to exist because of the emergence of, for instance, 3D printing. Transport will become obsolete; we will order the garment in Spain and have it printed locally. Your navigation system will take you were you need to be (using Big Data). In the future, being reachable via a website or a phone number will no longer be enough. Making a dinner reservation or placing an order at a local shop via an app, AppleWatch or Tesla screen will be like second nature. And even more fun: your navigation system will automatically drive you to the restaurant that suits your mood, experience, friends and state of health (organic or gluten-free restaurant). The presence of the omni channel within your company is a necessity and will, to an extent, determine whether you will make it as a business.
Retail and 3D printing
3D printing will play an important role in retail. In the future, for instance, the bike shop will no longer order his parts from the manufacturer. Bicycles and parts will simply be printed. This will influence the entire retail chain (from shop owner to manufacturer). Soon, keeping stock will no longer be necessary and the existence of the manufacturer will depend on the extent to which they can respond to these new needs. This new development will also provide the consumer with new opportunities. Lego will introduce a 3D printer that enables consumers to print out unlimited quantities of Lego blocks for children, at 9.95 euro per month. I am looking forward to the drilling machine that will offer me the option to pay per drilling action.
Drones will deliver your package
Faster and more environmentally friendly. This is all possible with drones. Currently, drones are manually controlled, but in 5-10 years’ time they will find their delivery addresses independently, after having received their stock from the Albert Heijn robot. Organizations like Amazon have been working on their own drone delivery services for quite some time now. In a few years’ time it will be the most normal thing in the world to have your parcel delivered by a drone. By using the drone delivery service named Prime Air, Amazon is aiming to actually have parcels delivered within 30 minutes of the order. The drones are able to deliver parcels of up to 2.3 kg within a radius of 16 km from Amazon’s distribution centre. 86% of orders currently placed at Amazon meet those specifications. The development of independently flying drones for parcel delivery purposes will still take some time but if we are to believe Amazon CEO Jeff Bezos, this service will be deployed sooner than we think.