Six predictions for the future of retail
Source—Raconteur Media and Supplychaindigital.com
The coronavirus pandemic has accelerated future retail trends as many businesses rapidly adopt new services and technologies. Small businesses have been forced to develop digital platforms, in-store payments have moved away from cash and orders delivered by drones no longer seem worlds away. So how will shopping look like in 2025 and 2030?
Current Status
1. Return of physical stores
While the coronavirus crisis has shuttered many high street stores and seen retailers and consumers flock to ecommerce, physical stores will be the focus again, but with a new emphasis.
While COVID-19 has undoubtedly accelerated the rise of ecommerce, there will always be a place for bricks and mortar retailing.
Bricks-and-mortar retail have become a high-touch, sensory-driven experience.
This includes contactless payments, reducing physical touchpoints, expanding and simplifying click and collect. So, by using technology to reduce friction in-store and making it easier and quicker for customers to get in and get out,
2. Personalized offers
One of the key future retail trends, personalization engines are becoming more sophisticated. Data that feeds into personalization is honing the ability for retailers to suggest offers and content to consumers right at the moment of consideration.
In the old days, people visited local shopkeepers who knew them by name and could predict their needs based on what they wanted through a personal relationship.
Some retailers are recreating that experience at scale using data-driven algorithms taking in hundreds of factors to drive hyper-personalized offers and service for national retailers.
Data will be integral to the way businesses hear the voice of consumers and understand customer expectations.
By 2025
3. Blended retail experience
The 2020s will be a decade of disruption; COVID-19 was just the curtain opener. In 2025, we’ll still be experiencing the tail end of the pandemic in terms of its impact. Hybrid working models, reduced business travel, commercial buildings at lower occupancy and discretionary spending will remain cautious.
By mid-decade, the conventional retail model of just hanging rows and rows of clothes on hangers and supplying a couple of changing rooms and a mirror will be on the way out. “A resurgence in shopping malls, offering a richer range of experiences by blending retail, music, dining and entertainment will take its place.
Development of partnerships between different retailers, from hairdressers and spas to clothing retailers and office supplies, will see ‘unlike’ providers collaborate as part of a blended retail experience.
As the decade started, ecommerce was focused on reducing friction and aiming for a seamless experience, but it will move to being more engaging and immersive. Traditional retailers and online retailers will transition towards a convergence point.
4. Customer expectations rule
In 2025, more retailers will tap into local communities, developing hyper-personalization and hyper-localization to attract consumers with suitable offers. The trend towards hyper-personalization could see more retailers deliver a “white glove” service in a digital way to meet rising customer expectations.
Future retail trends will see stores evolve and follow the example of Starbucks and Nike to play three roles. These are as a transactional hub for immediate consumption, as an experiential venue and as a showroom to communicate about the brand and support online sales as ecommerce fulfilment points,
New digital solutions will enable retailers to meet rising customer expectations. Devices such as facial scanners will analyze skin to suggest personalized care based on individual needs and prior experiences. Virtual reality will enable customers to browse, interact with and read information about products in a virtual environment.
By 2030
5. Smart supply chains
Smart supply chains applying AI to predict demand and calculate supply will result in a direct benefit to the environment by 2030.
In 2030, entire supply chain will be aligned to accurate predictive models of consumer needs. Retailers will gravitate to suppliers with value chains more responsive to consumer behavior. They will seek to collaborate with more progressive suppliers and potentially look to integrate supplier and customer AI capabilities.
Instead of mountains of waste, data and AI will predict stock requirements, thereby limiting wastage and reducing the impact on the environment. And by 2030, retail in developed markets will have environmental issues embedded in it.
6. Seamless shopping
Consumers will have seamless shopping experiences through social platforms in 2030, shrinking waiting time for customer service queries with smart chatbots and bringing highly personalized experiences through user-generated content.
Prompted by COVID-19 a decade earlier, which helped propel online retail towards true omnichannel social commerce, discrete sales channels will have dissolved. Highly immersive retail experiences will be provided by virtual and augmented reality. In 2030, sales channels will include virtual reality and fulfilment will include drone delivery.
Brands will enable customers to move from offline to online, while providing a personalized experience. Social commerce can combine the personal touch consumers used to find in a store with the convenience of an online purchase.
