Retail: Keeping up in a sector that is always evolving?
The Future of Retail - How do you keep up in a sector that is always evolving?
Patrick Munden, Global Head of Retail and Marketing, at Salmon discusses the future of retail and how to keep up in a sector that is always evolving.
What does the future of retail hold? This is a question that retailers should ask themselves on a frequent basis. Retail is always shifting and new trends are constantly changing the way that brands build relationships with customers. It wouldn’t be unrealistic to imagine a world where artificial intelligence technology is used to predict the products that shoppers want even before they can think of it – no, this isn’t the rise of Skynet, but may well be the future of shopping.
Mary Meeker’s 2017 internet trends report offers a strong indication of how quickly retailers must transform their offering. While she covered a range of different topics, the overall theme focused on the rise of ecommerce, and Amazon’s subsequent dominance. There is no hiding the fact that Amazon is the leader in retail and that it never ceases to amaze its customers. The firm is so innovative that it has shifted back into physical space, while traditional high-street stores continue to struggle. Call it reverse-innovation, but Amazon clearly wants to own every single point of the customer experience.
Amazon: the competitor of all businesses
Amazon is not shy and wants to own every single aspect of the shopping experience. The digitally native firm has expanded its Prime service – which was introduced way back in 2005 – and is now involved in entertainment, cloud storage and professional services. As part of our 20 for 20 trends, we’re calling this trend ‘Interface Imperialism’. This is where brands diversify and expand their offering; consolidating all services under one interface (did somebody say Amazon?). As technology advances and connects everything together, the business that succeeds will be the one that owns the interface. After all, if you own the interface you own the customer.
By directly taking on broadcasters in entertainment (such as ITV on TV and Netflix on demand) and tech innovators (such as Microsoft in cloud storage), Amazon has announced itself as a key competitor for almost every single business. As one of the slides in Meeker’s trends report shows, Amazon is becoming a market leader in baby wipes and batteries. This may come as a surprise to some but definitely not to CEO Jeff Bezos who will continue to expand his firm into entirely new sectors; some of the lesser known areas that Jeff Bezos is interested in includes space exploration!
So, what does the future hold?
Retailers continue to focus on online platforms but there is a more niche trend emerging in the area of the interface-less society. There is clearly a market for voice-led platforms that enable the customer to shop, but also check their calendar, listen to the news and play music. Simply put, if I were to use Amazon Echo to shop, I might also use it to listen to the morning news and play my favourite Oasis album without too much hassle. Could this mean that I won’t be as reliant on my TV and phone as much…?
Essentially retailers must transform their own offering if they are to thrive in a world that is constantly moving. Wal-Mart’s attempt to catch-up with digitally native players, for example, could prove fruitless if customers have already moved towards platforms such as Amazon Echo, Google Home or Apple’s latest HomePod.
The future of retail shouldn’t be a question that is analysed but must be answered by retailers themselves. Amazon is currently doing just that, and as a result leads retail through its Fresh, Go, Echo, Dash and myriad other platforms.