Intelligent technology will shape the future of retail
- Demand for AR and VR tech is rising in various industries
- Younger users prefer using intelligent tech for a variety of use cases
- The retail industry is adapting more intelligent tech to cater to younger consumers
Over the last couple of years, intelligent technology driven by artificial intelligence (AI) has been bringing forth new innovations and experiences across a variety of industries and use cases. AI has eased many processes by automating tasks. And now, with deep learning algorithms, AI can perform more complicated tasks too.
For consumers, the use of AI and other intelligent technology enables consumers to have a better experience. Apart from AI, tech like augmented reality (AR) and virtual reality (VR) are now highly sought after, especially by the younger generation.
Statistics show that the global AR, VR, and mixed reality market is forecast to reach US$30.7 billion in 2021 and rise close to US$300 billion by 2024. Part of the demand for the tech is the innovations in the metaverse. But these intelligent techs are also finding use cases beyond the metaverse, such as in the retail industry.
According to research by Amido, intelligent technology will be vital in the retail sector as well. As retailers look to a future beyond the pandemic, 88% of retail tech decision-makers (TDMs) surveyed see these intelligent technologies as being crucial to increasing their advantage over competitors.
Intelligent technology in retail blends well with the younger age group with 84% confirming that they would find at least one, if not several, emerging technologies useful as part of their shopping experiences. However, retailers need to also consider the older demographics when implementing new technology as 50% of this audience lists the ability to try products as a reason why they may prefer to shop with retailers that have bricks and mortar offerings.
While technology brings opportunities for retailers, it does come with challenges for omnichannel businesses. TDMs have earmarked the need to find a tech to improve and speed up deliveries as their number one challenge (58%). Fulfillment networks (47%) and customer demand (45%) are listed as the top two limitations to increasing the use of new innovations. Emphasizing the scale of the challenge, almost half (47%) of TDMs currently fear that they’ll be unable to ship products post-purchase.
“Often, it is all too easy to focus on emerging technology and how it can provide innovation to a sector like retail. But the real battle in retail is often in nailing the basics at scale. Being good at omnichannel is hard and most retailers need to fix this before they invest in technology that is additive to that core. At every turn, the business value is dependent on the technologies that will convert potential chaos into a sense of control,” stated Amido CTO Simon Evans.
Big spenders like intelligent technology
For some retailers, adapting intelligent technology would mean compromising on some users. But if there is one thing that the pandemic has thought them, consumers are willing to adopt changes. When lockdowns were imposed, most consumers bought goods online, regardless of what age group they were from.
While there are concerns on data security, privacy and such, 46% of 16-to 24-year-olds consumers surveyed revealed they would be happy to part with more of their personal data, if it led to new offerings from the retailer. Over a quarter (27%) of respondents overall are also ‘floating voters,’ as they are still undecided on sharing more data, and therefore could be enticed by the lure of an improved service.
And retailers seem to be aware of this balancing act, and data insights proved to be a foremost priority for TDMs when deliberating customer retention strategies. Ideas around improving store experiences via online insights (53%), getting to know customers in a more personable way to keep them loyal (48%), and generating more tailored recommendations and personalization communications as a result (47%), are all listed amongst the top priorities from a customer retention strategy standpoint.
The reality is, intelligent technology is going to be part of the retail experience. Kate Ancketilll, CEO of retail consultancy GDR believes that just like sustainability, technology cannot deliver any meaningful results if it is just bolted onto an existing proposition.
“Any retailer still approaching technology in the same way it did 10 years ago has to consider this a complete organizational failure. The days of PR-focused scattergun, “tech for tech’s sake” activations are over. Investment in a targeted and robust, next-generation omnichannel strategy is now mission-critical.”
Indeed, the rise of AI, AR, VR, and other intelligent technology is not going to slow down. And with supply chain issues a growing concern as well, retailers will only look into having more technologies to keep their customers satisfied.
As Evans puts it, “For those still in any doubt, the solutions are all in the stats – consumers have never been more vigilant to how brands are striving to meet the future of retail. An omnichannel future of retail. To ignore their calls now could be to miss out on this future altogether.”