Global VP of Product at SES-Imagotag, a global leader retail IOT.
Technology just won’t stop disrupting brick-and-mortar retail, and don’t even get me started on competing with e-commerce.
Today’s consumers expect more. They’ve come to expect a convenient and frictionless experience, but they are also looking for something more when they do make the effort to head to the store. Shopping spree, anyone? It’s this fusion—the interplay of the e-commerce mindset and the yearning for something tangible and face-to-face—that is driving today’s retail trends.
Here are three pivotal retail trends to watch.
1. Geolocation combined with AI could reinvent in-store tracking.
Just look at the unprecedented volumes of real-time data—forecast to reach 79.4 zettabytes (almost 80 trillion GB)—streaming off Internet of Things (IoT) devices and other connected assets. That’s enough data to fill 79 billion 1 TB hard drives.
Now let’s combine that with the analytical abilities of artificial intelligence, and retailers have a recipe for improving in-store tracking.
“The advent of generative AI in retail could unlock opportunities for combining the large amount of real-time, item-level data produced by passive-item level trackers with the processing power of AI for upstream inventory management across a retailer’s enterprise,” explains Gartner in the Hype Cycle for Retail Technologies, 2023.
Imagine that in the near future, by leveraging Bluetooth implementations, item-level tracking will become more accessible and transform stores into sensing areas capable of tracking items from pallets to shelves potentially with no human control needed.
But it’s not just inventory visibility. Retailers can leverage these synergistic technologies on the back end for predictive demand forecasting, preventative stockouts and overstock and dynamic reordering.
On the other side of the equation, they can build heat maps of product routes and optimize in-store picking.
When we put this all together, we see a clear realization of the 21st-century retailer’s mandate: Make in-store shopping as seamless as e-commerce but also differentiate it by improving the overall shopping experience. By improving the efficiency of in-store operations and lessening the burden of their teams, retailers can use tech to maintain a high quality of service.
Another use for these technologies is compliance and traceability. By seeing the movement and handling of items, retailers simplify their regulatory burden while also mitigating margin erosion due to theft.
When combined, retailers can bump up the bottom line.
2. In-store fulfillment is here to stay and growing.
Another way that e-commerce and brick-and-mortar come together is click-to-brick shopping: The customer clicks around online from the comfort of their home before putting on their “hard pants” to go out to the store.
Buy online, pick up in-store (BOPIS) surged in popularity during the pandemic, but the trend is here to stay. In fact, the global BOPIS market is expected to grow from $243.8 billion in 2021 to $703.2 billion in 2027, with U.S. shoppers already spending $95.9 billion on click-and-collect fulfillment in 2022.
If you’re like most retailers, you’re under pressure to provide fast and reliable in-store picking services. However, staffing for and preparing large orders in under a couple of hours is a huge operational challenge.
Retailers need tech. It’s the only way to optimize and streamline in-store fulfillment. Your staff is great, but they’re not robots, and they need help. Tech can help them scale your BOPIS program and increase customer satisfaction.
Curious what this looks like in action?
It starts with precise geolocation of items and inventory levels connected to the BOPIS system. Associates look up availability and location to make picking items in aisles faster and more efficient. At the same time, the back-end system automates workflows based on the picker’s location for further optimization. The end result is faster service and happy shoppers.
3. Computer vision can provide value beyond inventory management.
The use of computer vision (CV) in retail has been steadily rising; we all know about the ROI for managing in-store inventory, visual merchandising and mitigating shrink. It’s also brought a wealth of valuable data for retail intelligence.
As Head of Product in my previous role, I’ve built CV-based systems serving as the backbone for autonomous stores. I’ve also witnessed CV in enterprise-scale retail chains become the segue into checkout-free stores that are powered by self-checkout and other automated payment methods.
The result is the next generation of in-person shopping. This means that customers can simply pick items up and walk out of the store because CV systems automatically recognize what’s in their baskets and charge accordingly.
Beyond that, the industry is always looking to push the envelope. One innovative way that CV is being used is by combining it with temperature detection. This allows retailers to visually track fresh and frozen food to detect any shortcomings in the handling of delicate merchandise.
As retailers join forces to tackle climate change in the Race to Zero, CV offers a solution for supporting these sustainability initiatives. This emerging CV use case can also enable retailers to monitor and reduce energy consumption by automating lighting and heating/cooling systems based on occupancy. Lighting controls alone can reduce lighting energy use by 10% to 90%, depending on the space.
Understand today’s trends to create a long-term vision.
Ultimately, you need to think ahead. Retailers should look at the tech that their businesses will need in the next five years and consider today’s trends as the baseline of what stores will look like by then.
At the same time, if there’s one thing that’s become constant over the past decades, it’s the necessity of adapting to rapid change. In order to survive, retailers must stay flexible, remain agile and create strategic alignment between the digital and physical spheres.
E-commerce and pandemic-accelerated trends aren’t going anywhere, but neither is your partner casually asking if you want to go out shopping on a Saturday. People want to browse products, and they want to interact with other real people.
Tomorrow’s retail winners will be those who understand how to walk that line and then execute the technology.
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