The battle between online and offline retail is changing the landscape of the industry beyond recognition. We’ve taken a look at what we can expect from the sector in the next five years.
The retail landscape has been transformed in recent years thanks to the growth of online shopping and the widespread adoption of digital technologies.
New advances and shifting shopping habits will continue to drive developments in the industry over the coming years, changing the shopping experience out of all recognition.
Here are some of the innovations we can expect to see in the way we sell and the way we shop in the next five years:
More in-store experiences
To tempt customers offline and back into their physical shops, retailers will offer more in-store experiences. No longer just places to house and display stock, shops are already becoming venues for everything from community events and crafting sessions to advanced interactive experiences. For example, Australian DIY firm Bunnings Warehouse, that recently acquired UK brand Homebase, holds free DIY workshops, including special sessions for women, while customers at Tesla Motors’ Toronto store can configure their own car on a touchscreen and then view it on an 85-inch video wall.
Social media marketing
Social networks have already become shopping platforms for many retail brands and customers, but their potential as marketing tools has yet to be fully exploited.
Expect to see new products tested on social media before being sold, with Instagram ‘likes’ and Pinterest ‘pins’ used to gauge interest and customer feedback influencing product development. Brands will also invest more heavily in marketing and advertising through these channels at the cost of ‘traditional’ campaigns.
The end of the loyalty card
Customers are becoming less loyal and more ‘promiscuous’ in their search for bargains, so the days of the loyalty card could be numbered. In the UK, Sainsbury’s has halved the number of Nectar points it gives, while Tesco recently announced the end of its popular ‘boost’ scheme, where the value of Clubcard reward vouchers are doubled for certain purchases.
However, the data that is generated from these cards is invaluable to stores as it gives them an insight into customer buying habits. In order to retain this data, retailers are likely to offer more personalised rewards and value-added perks for loyalty, like Waitrose’s free coffee offer.
Same hour delivery
Same day delivery is already a reality in many places, and Amazon has now started offering same hour delivery in certain areas. The online retail giant has even been testing 30-minute drone deliveries.
Brick-and-mortar retailers will start to compete, using their stores as distribution centers and investing in faster delivery services and technology developed to improve efficiencies within the warehouse instead of opening new outlets.
Self-checkouts are ubiquitous in our supermarkets and are starting to creep in to other businesses, such as fast food chains like McDonald’s. To cut their overheads, retailers will automate an increasing number of their in-store services in future. Customers can look forward to more product vending machines, automated kiosks and self-scan facilities. There have even been developments in creating microchips that will be included on every product so customers can simply fill their basket and walk through scanners and have the shopping automatically charged to their account.