We are living through the biggest period of disruption and change ever to impact the retail industry. We seem to hear it every week: profit warnings, CVA’s and once-great retail businesses going into administration. And running in parallel with this turbulence is an incredibly exciting period for retail technology.
In short: there’s a lot going on.
To try to make sense of all this, Novoda hosted a retail roundtable dinner. Held at the Hoxton Hotel in Shoreditch, the event gathered a group of senior retailers from some of the biggest and best known names on the High Street to discuss the challenges and trends in retail. Here, we share the insights.
Disruption In Retail
Disruption is everywhere, but from where did this group feel the greatest source of disruption was coming from?
The views were varied and insightful - many people highlighted the sheer pace of change as one of the biggest disruptors, along with the ability to move from the physical to the digital and back, in the seamless manner that today’s consumer demands.
There were some larger issues - such as constantly changing strategic direction, consolidation, being able to connect all the dots and having the ability to deliver great rich content - and some more specific ones, such as machine learning and IoT.
It quickly became clear that disruption has many faces! Amongst the topics discussed during the evening were:
What does a truly frictionless shopping experience look like?
Much is written about ‘frictionless’ shopping and it became clear that it means different things to different people, and also depends largely upon the journey. Whilst a weekly grocery shop needs to be quick, easy and frictionless, a luxury item purchase can perhaps afford to have ‘friction’ deliberately built into it.
What can big data and AI can contribute to the omnichannel journey ?
Big data is here - the question is how to access it, interpret it and use it in ways to deliver real value back to the consumer. At the moment, many retailers feel they are drowning in data.
It’s through AI (we think of this as Augmented Intelligence, rather than the misleading ‘Artificial’ Intelligence), that we are able to sift through this data. The result is only the useful data, which can help us, rather than hindering us through the sheer volume of it.
With good data, it becomes possible for retailers to convey a real sense of purpose that is consistent across all of their channels and touchpoints, and in keeping with the brand at all times.
How are the demands of today’s consumer creating the new age of loyalty?
Loyalty is dead; long live loyalty! The demands of today’s consumer are such that we are at the same time loyal and promiscuous. One minute shoppers are fiercely loyal, and the next, seemingly having shopping-affairs up and down the High Street!
With that in mind, retailers are shifting away from an ordered world of linear planning - this is an approach that simply no longer works. With so many retail structures built in a very hierarchical manner, command and control has never seemed so out of place.
Younger start-up retailers have recognised this from the outset, and have never had the hierarchical structures that now need to adapt - it’s simply built into their culture to approach planning with flexibility and fluidity. This puts them in a strong position against the more established players. For them, it is one of the biggest challenges they face.
What Trends Will We See In 2018?
The evening concluded with a literal roundtable, where the subject ‘Trends Of 2018’ was discussed. There were some interesting views.
The first was perhaps the most insightful and surprising: are we, in reality, moving away from a digital life? With the recent headlines regarding online privacy, many people have recently considered their online life in a way they perhaps hadn’t before. Have we already reached a pivot point where more and more will opt out of an intensely digital world?
The discussion already having been taken in a surprising direction, this was followed up: could technologies such as Artificial Intelligence in actuality be blind alleys? Perhaps it would be better to invest in staff and the human interaction rather than digital?
Echoing that theme, it was raised that if grocery retailers really know their customers, why do we not have VIP lanes at supermarket checkouts? The retail industry still has much to learn from others, such as hospitality and airlines.
Data was never far from the topic of discussion and as a trend in 2018, it was cited as being an enabler to innovation.
And another fascinating insight: the value of time. As we become more and more engrossed in consuming digital content, the value of time will become more and more evident.
We discussed investing in staff and the experience - both how the shop floor is utilised to its fullest potential, and somewhat paradoxically, how digital is fuelling the in-store experience.
Automating the mundane seemed a great way to express the ever-growing potential for automation in many aspects of retail, allowing humans to ‘do something more interesting’.
The last trend highlighted is perhaps the one which keeps many retail businesses looking over their shoulder: that the awakening that Amazon is really here has come too late for many retailers.
The sheer pace of change and innovation is bewildering. Where to place your bets, where to make those investments – and at pace: these are key to survival. For those retailers still clinging to the belief that past working practices will continue to work, a nasty shock is just around the corner.
Old ways no longer work, and they’re no longer relevant. It’s time to throw away the rule book; tear up those well established command and control structures and have a sense of purpose.