Tech Trends Reshaping The Retail Sector
Imagine a day when you put on your VR goggles, and appear in a virtual store. No traffic, no parking hassles, no walking across the mall to get to the store. You enter your personal clothing store, where everything is your exact size. Everything fits. Your friends may also join you via their VR headset making the experience social and fun. You can ask an AI advisor for help online. As you move in, your virtual reflection - the mirror - moves in exact sync. It feels and looks just like you are looking at yourself in the mirror. When you’re done, and you have the exact, perfect clothes you need, you pay the bill and your clothes arrive in no time…
This may no longer be a fantasy, not at least in the near future. Experts believe the day is not far when the retail industry will transform into a virtual place, the kind of things we have seen in movies like Matrix and Avatar! Innovations in technology is having a major impact on the way we shop. Thanks to the game-shifting technologies reforming the retail markets include smartphones, tablets, location-based services, augmented reality, big data, social-media, and, somewhere in the future, 3D imaging - to name a few.
The online retail market, which is now valued at $226 billion, and is estimated to rise to $327 billion by 2016 – a whopping 45% rise and will continue to grow steadily. Though retail giants like Amazon and eBay may dominate the market, smaller players in every region and geography (such as Flipkart in India) will continue to reap great benefits.
Here are some technologies that have the power to reshape the retail industry. While some are already underway, some others have the full potential to become mainstream in the coming years.
The big shift to M-commerce: E-commerce has been growing for years, but now Consumers are increasingly using mobile phones and tablets for product research and online purchase – a clear shift to mobile commerce from shopping on laptop or desktop PCs. Justin Honaman, an online retail marketing specialist writes in his blog, the percentage of consumers who use smartphones and tablets is growing rapidly and willingness to use mobile wallets will rise as confidence grows in the Retailer’s ability to secure consumer information.
However, despite financial institutions, payment networks, mobile network operators, merchants, and mobile technology providers are all battling for their own piece of the action,” Honaman states making mobile wallets mainstream will take a few more years.
Stepping up Big Data/ Analytics efforts: Retail, like several other industries is looking to leverage Big Data in unique ways to maximize profits. For retail, this would mean accessing to real-time analytics that will digital pricing (both in-store and online). Seshagiri Anegondi, Vice President, Technology, Oracle India explains big data capabilities will allow dynamic pricing in a real-time, customized manner as against the historical sales trends. “Based on consumer purchase behavior, Retailers will also use Big Data to customize in-store product sets, improve inventory availability, set a responsive pricing strategy and differentiate offers to specific customer segments and channels,” he states.
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Coming of 3D imaging
It’s now possible to have your body 3D imaged from head to toe at a sub-millimeter accuracy, showing every ripple of muscle or cellulite, to allow the perfect-fitting jeans or shoes, said noted author and MD of X PRIZE FoundationPeter H. Diamandis. He explains that the technology is breaking out (from deceptive to disruptive) right now.
First, it may be derivatives of Microsoft’s Kinect, or Google’s new ProjectTango. As Google demonstrated, this technology gives smartphones the ability to do realistic 3D mapping. Your phone will be able to create 250 million 3D measurements per second to build a 3D model.
Emergence of virtual stores
The way of the future is headed there may not be an inclination towards opening brick-and-mortar stores and instead, players will work towards cultivating virtual ones, where the real opportunity lies believe experts. In fact, e-commerce is set to replace physical retail spaces altogether in some parts of the world. Companies in the US like Toys“R”Us is looking to gain a foothold in foreign markets, plan to open mobile-friendly retail websites in places like China, Australia and France.
According to experts, retailers will however continue to find new ways to differentiate the in-store shopping experience from online. They will offer in-store only events and services and invest in guest experiences aimed at bringing customers to stores and keeping them there.
Transforming in-person shopping
Technology in retail is no longer limited to the Web. These tech innovations will transform the in-person shopping experience - making it more interactive, personalized and impressive, believes Diamandis. For example, interactive “magic mirrors” that can display how an outfit will look on consumers (without actually trying it on), suggest accessories and point you in the direction of similar items; virtual greeters that can handle everything from conducting eye exams to offering discounts through QR codes; and 3D printers that consumers can use to create their own products on the spot.
In a recent article published in USA Today, tech analyst Jon Swartz comments “The next five years will bring more change to retail than the last 100 years.” Quite evidently, retailers who don’t adapt and use new technologies will quickly and successfully run the risk of losing out!
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