May 9, 2016
If you’re regular reader of this blog, you know we like to try to guess the future of retail. Of course no one can predict the future, but that’s never stopped us from trying. A recent article on the Chain Store Age website, Study: Three Technologies That Will Shape Retail and One That Won’t, took a look at a study that tries to predict the future of retail for the next 10 years.
Of course the study was conducted by Ovum, a technology company commissioned by Criteo, which is also a technology marketing company, so it focused only on technology. Included in the study was Hyper-Connectivity, Wearables, Augmented Reality, and 3-D printing.
The study sees that Hyper-Connectivity will be a major player in the evolution of retail by 2026. Often referred to as the Internet of All Things (IoT), it will soon become a regular part of consumers’ daily lives. According to the report, “… By 2020, there will be 660 million machine-to-machine (M2M) connections, which will make retail more efficient and effective. Connected retail display cabinets and smart tags will be commonplace, enabling retailers to track demand and report on stock levels in real-time, which will in turn improve supply chain effectiveness.”
For smaller operations like nonprofit stores and institutional stores, hyper-connectivity may be a critical part of improved efficiency that may be required to keep stores viable as a competition from online retailers intensifies in the near future. If your store’s structure, like shelving and display racks, can work in tandem with smart tags, then your ordering can be streamlined, losses can be prevented, and inventory can be predictive.
Machine to machine connections can also improve the customer experience. Digital signage will provide streamed content and advertising that will anticipate and target things of interest to your customers. That might be something simple like changes in weather, or might be more elaborately tied in to what is going on in your institution. Furthering the connection between your institution and your store will help maintain a high-energy vibe in your store and help integrate your store into the overall museum experience.
Augmented Reality (versus virtual-reality), according to the report, may have a major impact on the consumer’s retail experience. Augmented Reality enhances normal views through digitally generated information or graphics that are superimposed. The study says that it has the ability to, “…blur the boundaries between online and in-store shopping.” Giving customers the opportunity to virtually try on clothing and jewelry may help provide them an experience that’s both unique and productive. For smaller stores that don’t have much room, Augmented Reality may help provide virtual square footage and help you add more items to your line-up, including expanded clothing lines, without the need to fitting rooms.
While the report doesn’t anticipate 3-D printing having a large impact in retail, it does mention that it’s probably most effective for retailers who sell, “highly personalized products such as gifts.” Since many institutional and museum nonprofit stores sell a lot of gifts, 3-D printing can actually be an important part of your future. For one thing, specific printing of smaller items is the epitome of just-in-time delivery. With 3-D printing there is no back stock or out-of-stock, only soon-to-be-printed stock. The ability to customize a gift also creates another value-added benefit for your customers. Don’t forget, it will be another differentiating feature of your store that you can include in your marketing.
If you’re familiar with the Walker Museum’s Intangibles line of merchandise that features the work of local artists that’s available for sale to the public, you can imagine the possibilities of that type of product combined with the immediacy and affordability of 3-D printing. You’d be limited only by your imagination.
For stores that sell a lot of books, On-Demand-Printing may also be another way to expand your inventory, without taking on the additional expense of holding actual inventory.
Of the emerging technologies, Wearables may be the hardest to calculate. Ovum expects over 650 million wearable devices to be in the marketplace by 2020. But the impact of Wearables on retail may be limited to tap-and-go mobile payments or as a user-friendly mobile commerce platform.
However the future turns out, you can be sure most of the guesses will only be close. Technology will change the future in ways we can’t predict. And of course, the more things change the more they stay the same. Walmart just reported that their greeters are returning to their posts by the front door. Some things never change (at least, not for long).
Steve White is a writer and entrepreneur living in Denver.