From big data and smart analytics, to beacons and mobile apps, technology has already transformed how retailers operate and interact with customers. Significant progress was made in 2017; but 2018 is set to be the year when technology truly begins to take over. In this piece for RetailTechNews, Richard Smith (pictured below), regional manager, SOTI, predicts which smart retail technologies we are likely to see in 2018.
In this ‘age of the customer’, the provision of personalised services and more intelligent customer interactions is vital. As such, the likes of artificial intelligence (AI) and the Internet of Things (IoT) will see the industry become increasingly agile over the next 12 months and beyond, all to the benefit of the consumer.
But that’s not all. Wearable technology will be implemented in new and innovative ways and the ‘drone delivery’ conversation will continue to gain momentum as the technology developers further and becomes more cost efficient. We’re expecting major changes to take place in the industry throughout 2018.
AI takes the lead
It’s no secret that artificial intelligence is currently the hot topic of conversation in virtually every sector imaginable. Businesses of all sizes are using it to transform the way they operate and, in retail specifically, the growing influence of AI is showing no signs of slowing.
For example, according to Gartner, 85% of customer interactions in retail will be managed by AI by 2020; while analyst firm Research and Markets predicts AI in the global retail market to grow from USD$993.6m in 2017 to USD$5bn by 2022.
The main driver behind this growth is a need to make sense of the vast amount of data being created by consumers as they shop through multiple digital and physical channels. AI technologies can interpret this information and provide real-time, data-driven insights that businesses can use to improve their interactions with customers.
It also has a key role to play in automating time-consuming processes and providing the more personalised shopping experience that consumers are demanding.
From the likes of bespoke marketing campaigns based on a consumer’s purchasing history and location, to automated order creation following continued purchases of day-to-day items, AI is already revolutionising retail and will continue to do so in 2018.
The possibilities of IoT devices are realised
IoT has been a hugely prominent technology buzzword over the last couple of years, creating new business models and increasing efficiencies for businesses in all industries.
The technology is already being used in retail; but 2018 will be the year where IoT really transforms the customer experience. We’ve already seen an increase in customer touchpoints – such as in-store tablets and online chatbots – but this will evolve rapidly over the next 12 months as shops become even more connected.
This is something that consumers are now taking into account. According to our own research, 67% of shoppers are more likely to shop at a store that integrates technology and over two-thirds believe retailers that utilise more technology enable a faster shopping experience.
What’s most exciting for the coming year is how extensive the applications of IoT in retail are. Robots will stack shelves, freeing up staff to add value to the customer, while smart mirrors will let customers virtually try on clothes and connected beacons will send out personalised offers to consumers immediately as they enter the shop.
2018 is likely to be a significant year for IoT in a range of industries and, for retail, it could be truly transformative.
Wearable technology will transform supply chain operations
In the consumer world, the growing prevalence of wearable devices has been one of the key trends of the last few years and the technology is now also being widely incorporated into the business environment.
From a retail perspective, supply chain management is the area where the truly transformative benefits of wearables are most likely to be realised, from cutting-edge devices to more established ones such as voice headsets.
For example, wearable tech can simplify warehouse management and improve operational efficiency by enabling the workforce to quickly and easily scan items and monitor stock levels. Smart watches can be used to optimise the layout of warehouse floors and smart glasses provide opportunities to remove time-consuming, paper-based processes.
But it’s not just the retailers themselves that will benefit, as wearables will also serve to improve the customer experience. Geographical Information Systems (GIS) technology will streamline the delivery process for the retailer, immediately earmarking the closest warehouse to the customer with the relevant product in stock.
It’s still relatively early days for wearable technology in retail; but 2018 will be the year when supply chains become significantly smarter and more mobile, thereby creating new value for both retailers and their customers.
The sky’s the limit for drone deliveries
In December 2013, Amazon CEO Jeff Bezos promised that the company would soon start delivering packages by drone. Although the plan was initially lambasted as nothing more than a marketing stunt, Amazon completed its first successful Prime Air drone delivery three years later to a house in Cambridge.
And Amazon isn’t the only one experimenting. Domino’s delivered its first pizza by drone in New Zealand in November 2016, while Boeing recently unveiled a prototype for an unmanned cargo air vehicle that it says can carry as much as 500 pounds.
Clearly, the drone delivery trend is making real progress. Same-day delivery is already an option for many retail goliaths and drones have the potential to offer same-hour delivery where necessary.
They are also being widely tested for ‘last metre’ delivery, which would not only provide a new level of convenience for customers, but also serve as a tool for business differentiation in the technology-driven future of ecommerce.
It may still seem like science fiction, but drone deliveries really are set to take off in 2018. More and more regulators are embracing this exciting evolution of the retail industry, meaning it won’t be long before our parcels are flying through the skies and landing right on our doorsteps.