I have been thinking a lot lately on the future of retail.
We have seen more and more consumers buying from their phone or tablet. People are getting comfortable buying clothing online. We are even starting to like those crazy sponsored posts that follow us around the internet, urging us to buy something you didn’t know you wanted (its ok, you can admit it. This is a safe space – my last such purchase was Hu Chocolate and I LOVED it, but I digress).
From my manufacturing days, I also know that retailers buy products based on it having the right fit, the right material, the right price and being able to be in the right spot at the right time, compared to basing their decisions on aesthetics (ie what something looks like).
Lastly, I watch my tweens dying for things from their favorite Instagram star. These sales usually follow a forced scarcity model – limited quantities for a very limited time. You have to be a follower “in the know,” to even hope to pay full price for their merchandise.
So how do these observations predict the future of retail?
I believe that the next gen of successful companies, or existing companies that want to continue to enjoy success, will be those that use technology and data analytics to offer products that they “know” that their target customers like. And if they can get the quantities and offering right, they can enjoy full margins while doing so.
Sound crazy? Impossible? Not so much.
There are successful companies that already employ technology that can predict what you want. Beyond the sponsored posts mentioned above, Spotify uses its smart algorithms to predict what music you like based certain characteristics of songs you previously liked. Rent the Runway is another great example. It uses its customers’ rental history, fit preferences and feedback to help it decide not only what to recommend to you, but what it should manufacture for its house brand, Slate and Willow.
Will a traditional retailer utilize technology in-store? That’s the million dollar question.
After watching retailer after retailer close in 2018, I am hoping to see a brick and mortar native start utilizing and benefiting from similar techniques. How cool would it be for a store to offer you something it knows you want when you walk in? Well, I think it would be cool. It would certainly save time and make shopping in a retail store much more enjoyable for someone doing #theJuggle like me.
So what do you think? Creepy? Cool? Have we saved retail?
I would love to hear what you think about my predictions. I’ll just wait here, eating my paleo, vegan chocolate until you get back to me. 😉