We don’t need to tell you that the days of traditional shopping are behind us.
Customers today are voting with their wallets and choosing retailers focused on creating an enhanced customer experience. Whether it’s curbside pick up, cause based marketing, or social shopping — the way retailers are doing business is rapidly evolving.
Innovation in the retail industry is critical to staying competitive — and maintaining a healthy bottom line.
But what exactly are the retail innovations that are worth investing in?
To answer that, we’re shedding light on some of the most noteworthy trends and technologies in the retail industry. Have a look and see if you can incorporate these into your retail strategy.
1. Social shopping
The rise of e-commerce was a massive step forward in retail innovation. As consumers settled into their ability to shop from the couch, trends like shopping directly from Instagram posts took hold and social media is now much more than a social platform — it is part of a retail experience. E-commerce sites optimizing for mobile use and leveraging social media shopping not only boosts revenue, it also creates brand loyalty and a convenient shopping experience.
An excellent example of social shopping in action comes from the apparel store Bergstrom Originals, which regularly includes product tags in its Instagram posts so shoppers can purchase products directly on the platform.
The average person spends more than 6.5 hours online daily. Shopping habits are increasingly digital, and brick and mortar retailers have had to respond. Shopping trends like buy online pick up in store (BOPIS) have increased in popularity due to COVID-19 and top retailers including Walmart, Nordstrom, Kohl’s, and Lowe’s leaned in to serve the needs of their customers. Streamlining the purchasing process and creating an environment where those who are seeking to steer away from crowds – or those who find BOPIS a more convenient option – is one of the retail trends that is here to stay.
From SMBs to large enterprises, BOPIS is a retail trend with many benefits, including:
- faster order fulfillment
- additional foot traffic and in-store purchases
- maximizing convenience for the customer
But, BOPIS is not a silver bullet. Retailers must make considerations to staffing and inventory levels, impacts on the supply chain, and technology capabilities in order to support an omnichannel shopping experience successfully.
3. Experiential shopping
For retailers seeking to bring people in store and provide experiential shopping, looking to companies like Ulta may provide inspiration. In addition to a strong e-commerce presence, Ulta’s in-store salon services provide a reason to shop offline.
While this is not reinventing the technology wheel, retailers must work to increase foot traffic as well to gain their loyalty online. A strong omnichannel presence is critical for brick and mortar retailers in this digital age.
4. Contactless shopping
Determining the customer need is half the battle in a complex environment. Amazon responded to the need for convenient, contactless grocery shopping through the use of their Amazon Go stores, which first opened in February 2020. These stores use automation, machine learning and advanced sensor technology to track the purchases and allow the customer to have a cashierless shopping experience.
This concept is not one most retailers could implement, but ask yourself: How can these same principles apply to others and create a more seamless retail experience? How can you remove contact and friction from the shopping experience?
5. Visual search
Retailers have entered an exciting new era as e-commerce sites are leveling up their technology. For example, Wayfair’s “search with photo” technology allows customers to snap a photo of a furniture item and look for similar items on their website. This feature not only increases the chances of a purchase, but also lures customers away from the competition, offering more variety and often lower prices.
This concept is also taking hold with other companies too. Competitors focusing in the furniture and home decor space, such as Amazon, are rolling out similar features to offer an immersive digital experience and convenient shopping.
6. Cause based marketing
Another trend running in tandem with user-centric and convenient shopping experiences is cause based marketing.
Aligning marketing and sales strategies with a cause that gives back in either a social or environmental way can be a huge benefit to retailers. If customer loyalty is a goal, cause based marketing is an effective and innovative way to secure return business. If building a brand reputation is the main objective, aligning with a cause that can make a substantive impact locally and/or globally is an excellent solution.
Applying innovative technologies and experiences to the retail experience, while partnering with a meaningful cause is part of a holistic innovation strategy.
7. Machine learning and automation
Using machine learning for more accurate demand forecasting is a prime example of how to get the right products into your customer’s hands. Machine learning and forecasting automation are powerful tools to analyze consumer trends and the additional uses can have major impacts. From targeted marketing based on demand, to managing supplier relations through more predictive inventory purchasing, data and analytics are key to retailers today.
8. Data protection and fraud prevention
With great data, comes great responsibility. A recent survey indicates nearly 80% of consumers are concerned with how their data is collected and believe the potential risks outweigh the benefits.
Protecting customer privacy should be a top priority for retailers seeking to create or build their brand reputation. There is no one answer to the question of, “how do we best collect, protect and utilize consumer data?”. In every example of innovation, measures must be taken to secure this information.
To provide an exceptional customer experience, retailers must protect their customer data. Using customer data to curate experiences and advertisements is a given in this increasingly digital age. But if payment systems are compromised and customer data exposed, brand reputation will be impacted along with revenue.
While not necessarily an innovation, data protection must be prioritized to ensure a positive customer experience in the long term.
9. Improved inventory tracking
Preventing fraud should be part of the innovation and growth strategy. An emerging trend with a dual benefit is RFID product tracking. RFID inventory tracking helps insure accuracy, and it can also improve customer experience. This may be prohibitively expensive or unnecessary for some, but if faced with high theft or supply chain related inventory issues, it may be with consideration.
Bottom line: creating a compelling retail experience is no longer only about stocking the right products
Today’s savvy consumer is looking for the total package. When shopping online, your customer is looking for quick delivery speed, convenient user experience, and a customer centric experience. If drawn to physical stores, creating a shopping experience can be as simple as well stocked and organized spaces and as advanced as using AI technology to help the customer better visualize their purchase.
The future of retail is flush with opportunity. Rich with customer data and innovative technology, the retail industry is poised to improve the customer experience and increase sales if those opportunities are seized correctly and implemented in a meaningful way.
Where should an organization start innovating? Should it be a technological enhancement to the customer experience, offering convenient shopping and pick up solutions, creating an experiential shopping forum as a way to attract traffic, or any combination of the above? The answer should be, “yes, and”. Once the innovation begins, there is no end in sight to how retailers can grow their business by implementing creative, customer-oriented solutions.
About Francesca Nicasio
Francesca Nicasio is Vend's Retail Expert and Content Strategist. She writes about trends, tips, and other cool things that enable retailers to increase sales, serve customers better, and be more awesome overall. She's also the author of Retail Survival of the Fittest, a free eBook to help retailers future-proof their stores. Connect with her on LinkedIn, Twitter, or Google+.