The Future of Retail Technology

As we move through the digital age, more and more retailers are realising the benefits of moving online. Many exciting technology developments are occurring within this sector; from extended reality to automated processes, through to personalisation, so the sky’s the limit!

Here’s how brands can benefit from these new retail technologies, and which ones to keep an eye on as they are on the rise.  

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How can Brands Benefit from Retail Technology? 

It’s no secret that good customer experience is a leading factor in business growth (especially seeing as 86% of customers will pay more for a better experience). By using the latest technological trends, brands can improve customer experience by enhancing the overall efficiency and management of their business processes.

However, your customers aren’t the only ones who will benefit from this. Brands using sophisticated retail technology can better manage their inventory, predict demand, optimise supply chains, authenticate products, and much more.

Moving online also presents significant benefits for brands themselves. By maximising availability across different digital platforms, it makes it that much easier for customers to find you. This omnichannel approach provides a more seamless shopping experience. It can also help increase your reach for that extra competitive advantage.

Retail Technology to Look Out for 

Extended Reality 

Extended Reality (XR) is an umbrella term, covering Virtual Reality (VR) and Augmented Reality (AR) – both of which have proven effective in enhancing a customer’s shopping experience.

AR is an interactive experience that superimposes information onto the world we see before us. For example, IKEA has created ARKit – an app that determines if a piece of furniture will fit well in your home. Smart mirrors are another great example. They allow shoppers to try on different things, like an item of clothing or a shade of lipstick, without actually putting it on!

Augmented & Extended reality create immersive customer experiences

Similarly, Ralph Lauren’s flagship store features smart dressing rooms. Shoppers can adjust the lighting and easily send requests for different sizes. It even suggests items that go well with what they’ve chosen to encourage cross-selling.

VR, on the other hand, creates a simulated experience. IKEA uses this to help customers visualise what their new kitchens could look like. It removes the risky element of renovation and helps bring their vision to life.

eBay and Myer, an Australian retailer, have also collaborated to create the world’s first virtual reality department store. These examples give glimpses into an exciting future and adopting these technologies can provide brands with very unique selling points, which can help to drive more customers to their online or offline stores and boost sales.

Big Data  

Brands have been collecting data on their customers for many years and have used it to gain certain limited insights. The transition to a Big Data approach enables those companies to look at every stage of the retail process through both macro and micro lenses and use that detail to help personalise a customer’s shopping experience. This lends itself to brands being able to predict trends and buying behaviour, forecasting demand and optimising pricing.

An example of this is Walmart’s private cloud, where they use machine learning coupled with the big data gathered to help improve the customer’s experience. In practice, this could be if an associate picks items on behalf of a customer to fill an order, but one of the items is out of stock, smart substitutions provides an alternative.  

The Big Data approach might feel like it is the preserve of larger organisations, who have the budgets to put towards building such an infrastructure, but there are vendors who have spotted that and now provide a Big Data as a Service‚ style offering, such as Microsoft, Google and Amazon.  

Next-Generation Personalisation and Recommendations 

Recommendation engines are incredibly useful for retailers. They can help customers to find items or services that they didn’t even realise they needed, which in turn often leads to higher sales for the retailer and enables customers to shop with greater ease. The more data they obtain, the better the algorithms become; therefore recommendation engines only get better over time.  

Amazon is one of the best examples of a retailer using recommendations and personalisations. We’ve all probably added something extra to our cart because Amazon recommended something useful!

With the right technology, brands can also personalise their messaging based on customer segments. By doing so, they can boost conversions by appealing to their various customers better.  

Biometrics 

Biometrics can help provide a better in-store experience for their customers. For example, by using facial recognition, staff can identify the customer and be better able to respond to their unique needs based on past actions or buying behaviour. There are some clear benefits to using this type of technology, however it should be noted that it comes with some privacy and legal concerns.

Automated Warehousing and Stock Management 

Automated warehouses and stock management is crucial in improving inventory control. While manual inventories are long and laborious, smart robotics (like StockBots) and computer systems can do this automatically and in real-time. They can assess stock data reliably and then put it to use in a way that makes stock management easier.

With automated warehouse systems, businesses can manage and track their stock better. Over time, good stock management systems can help businesses to identify trends, so they can make more reliable predictions, implement improvements and take preventative action to prevent issues from happening or escalating.

A good example of stock management technology is radio-frequency identification (RFID) tagging. This helps businesses to track their stock throughout the supply chain and minimises the risk of inventory loss.

What the Future Holds 

The advancements and constant evolutions in technology are astounding! The future of retail technology is moving toward truly optimising customer experience and making the entire customer journey a more seamless process.

There are many exciting technological advancements to look forward to in the retail sector including:

  • More automated and self-checkout processes for customers (like Amazon Go)
  • Employee wearables to interact with store data
  • Further developments with Robotics, where AI will be utilised to make smart robots that can make decisions based on certain situations. Examples of this would be a robot deciding if an area is unclean and requires cleaning or analysing items in a box and moving them to the right shelves.

The future of retail technology includes both physical advancements and better analytics. These will help businesses to meet the changing demands and expectations of consumers.

Conclusion 

Technology moves fast in the retail industry – often driven by a more competitive landscape in many sectors and increasing consumer expectations. With younger demographics of shoppers often being digital natives, they help to drive this further and social media enables the spread of positive (and negative) buying experiences.

So, it’s important to keep your brand at the forefront of this digital wave by adopting emerging technology. However, there’s no need to rush in and take on everything at once! Choose technologies that align with your business objectives, customer profiles and will work well with your existing tech stack. This will help you to maximise efficiency and reap the many benefits.

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