The start of a new decade is always a good time to reflect on what the future might hold – and in high-street retail, the present pace of change is about as fast as you can get.
New technologies are changing the way that people browse and buy, with UK online shopping as a percentage of total retail sales now hovering around 20% – up from just 7% a decade ago.
However, these figures mean that nearly four-fifths of shopping is still done in Britain’s bricks-and-mortar stores. What’s more, some of the same disruptive technology that is allowing ecommerce to grow can also be used to make high-street retail more relevant, enjoyable and successful.
So, what clever tech can we expect to see more of in our town and city centres? Let’s take a look at some of the contenders.
1. Augmented reality (AR): smart mirrors to “stores of the future”
We’re all familiar with augmented reality, as it’s what we experience when we take a selfie with the latest Snapchat lens or play Pokémon Go. Basically, AR involves using a smartphone or other camera to add digital elements to a live view.
Virtual reality (VR), in contrast, is when people explore and interact with an entirely computer-generated three-dimensional environment, often using a VR headset.
One of the most talked-about uses of AR in bricks-and-mortar fashion retail is the “smart mirror”, where shoppers can, in some cases, see how they look in a particular outfit without physically having to try it on.
Or, at least, they can capture photos, compare looks side by side, or see which colour choice works best without the need to change.
Nevertheless, such technology isn’t new – Topshop was experimenting with it nearly a decade ago – and there’s still a tendency for AR to be part of “store of the future” concepts, such as Farfetch’s high-profile “retail operating system” in London in 2017, rather than something that mainstream retail has embraced.
That said, commentators still see ever-smarter AR experiences as one of the retail tech trends to look out for in 2020. It’s being suggested that the rollout of fledgling 5G networks – offering greater bandwidth and increased download speeds – may give AR the push it finally needs, along with a boost to mobile commerce more generally.
2. Artificial intelligence (AI): robot assistants and efficient supply chains
Artificial intelligence has long been at the centre of conversations around how tech can transform the retail experience, creating what has been described as “an opportunity to bridge the gap between virtual and physical sales channels”.
AI, in short, is about “making machines intelligent or capable of solving problems as well as people can”. So, in a retail context, this means complementing, or potentially even removing, the need for real human beings to perform customer service or other functions.
Many of the most obvious applications of artificial intelligence in retail are in online and mobile, rather than bricks and mortar, such as the use of chatbot-enabled messenger apps to improve customer experience and increase brand engagement.
However, there are also examples of instore robots that can interact with customers, particularly in Japan and the United States. Meanwhile, in the UK, the managing director of health and beauty retailer Boots, Seb James, recently told Retail Week that “the use of AI to drive more personalised experiences for customers, however they shop, will be a growth area”.
While the obvious novelty of empathetic, listening, talking robots has been shown to drive footfall, the jury is still out on whether such applications of AI genuinely benefit the customer. Those advocating such tech often highlight the “huge amount of useful data” that AI can gather, but that only works if the customer feels like they’re getting something back too.
In fact, where AI has most potential to be useful in retail may well be behind the scenes. In particular, it has application in enabling more efficient supply chains, using automation and learning to reduce the “bullwhip effect”: the phenomenon where vagaries of customer demand can lead to ever-increasing variance and problems higher up the supply chain.
3. NFC and RFID: for payments and interactive storytelling
Near-field communication (NFC) is a technology that has grown in prominence and usefulness as more and more modern smartphones and tablets have become compatible.
NFC is a “method of wireless data transfer that detects and then enables technology in close proximity to communicate without the need for an Internet connection” – but in practical terms, it’s best known as the tech that powers tap-and-go payment services like Apple Pay and Google Pay.
NFC uses the same basic technology as RFID (radio frequency identification) – both of which transmit information using radio waves – but it can relay additional information, such as web links, whereas RFID’s limitations make it suitable for inventory management rather than customer experiences.
Notably, retailers can use NFC as a more intelligent alternative to QR codes, without the need for there to be any line of sight between the reader (i.e. a smartphone) and the tag. For example, thanks to their small size, NFC tags can be easily incorporated into posters, menus, kiosks or other customer-facing materials, to transmit information when tapped by a compatible device.
One interesting tech company that is gaining attention in the retail space is the “frictionless shopping experiences” firm jisp. Using NFC technology, the jisp app adds a layer of interactivity – for ordering, storytelling and connecting – to the menu at a local coffee house in Alton, Hampshire. The company also showcased the world’s first payment-enabled digital shelf-edge strips – again using NFC technology – at the recent Retail Week Tech. festival in London.
At the same time, RFID still has room to grow in terms of enabling up-to-date records of store inventory that can, in turn, facilitate omnichannel services such as ship-from-store. River Island is using one such technology, !D Cloud by Nedap, to achieve weekly stock accuracy of more than 97%.
4. Google: bringing the high street to the search engine
For all this talk of mirrors, robots and tags, sometimes it’s the more established, simple and low-cost technologies that still have scope to be most useful.
Google, for instance, is not only a portal to the high street via its ubiquitous search engine, but is a tool for exploring and discovering places once you’re there, using the increasingly smart Google Maps app and the business information that retailers themselves update via their Google My Business listings.
Clearly, it’s a stretch to expect many small retailers to embrace technology such as AI or NFC when there are still plenty of local shops that are missing from Google Maps entirely, or that are yet to claim the listings that engaged users have automatically created for them.
The power of Google only increases further as other tech innovations plug into, or piggyback onto, its wealth of data about UK bricks-and-mortar businesses. Social networking travel app ROAM, for instance, adds extra functionality that lets shops and other businesses send push notifications to customers about news, offers, events or loyalty rewards, while at the same time users create and share their itineraries with friends. All this is packaged up as a way of driving footfall to the high street by making it visible and explorable in new ways.
Under the tagline “getting people back into high street shops”, another product that taps into Google is NearSt, a tool that has been covered by BBC News. NearSt connects to independent retailers’ electronic point of sale (EPOS) systems, and shows consumers stock availability and prices in Google in real time. Suddenly, it can become more compelling to go and pick up that product from the nearby local stockist, where you know it’s available immediately, than to order it from Amazon.
Having to download an app can always be a barrier to use, but NearSt instead integrates its live inventory system seamlessly with Google so that results are shown, where available, when someone Googles a particular product from their mobile phone.
Hence, the big challenge – and opportunity – here is to keep bringing more retailers on board, rather than having to win over the consumer, who experiences NearSt without ever really realising.
5. Customer surveys: listen and learn
Whatever the tech being used instore, it all comes down to businesses wanting to achieve one of several things: to make their processes more efficient; to sell more of whatever they offer; to better understand the customers making those purchases; and to delight those shoppers, and keep them coming back. Clearly, in all these scenarios, having access to quality, timely data is key to achieving those goals – whether that data relates to the items being stocked and sold, or to the people buying them.
In a store that is using innovative technologies to engage with its customers in ways that might be as disconcerting as they are exciting, it’s perhaps more important than ever to gather meaningful customer feedback that can ensure those experiences aren’t falling wide of the mark.
With a range of ways to deliver its surveys – such as in person, through email, or via an instore terminal – a tool like Surveyapp delivers real-time insights and live wallboards that let businesses make immediate improvements, where needed, to their services, products or bottom line.
Commentators have argued that by taking on board the latest retail technology, bricks-and-mortar retailers can create a powerful and blended customer journey that makes a real virtue of the physical space and is hard to replicate wholly online.
By making sure they ask customers the right questions – and act swiftly upon what they find – retailers will be better able to distinguish the tech gimmicks from the innovations that genuinely deliver a more compelling experience instore.