This article is part of Raydiant’s new Future of Retail series which interviews the world’s leading retail experts to better understand how the industry has evolved and most importantly, where it’s headed.
The following is from an interview with Mara Devitt, Senior Partner, McMillanDoolittle
** This interview was conducted prior to the Coronavirus outbreak**
What personally excites you the most about the retail industry?
MD: Retail is the front line of business – the fast-paced, social marketplace with participants actively competing to be the consumer’s choice. It’s this fast pace, this “action” that excites me the most – it challenges all of us to be at the top of our game or risk quickly falling behind.
What has been the most dramatic change you’ve seen in the industry over the past 3-5 years?
MD: Elevated consumer expectations across the board regarding quality, convenience and price. Of these, the expectation around immediacy is the most dramatic. Consumers expect to have anything they desire delivered to their door within a day or else be available in a store or for pick up within the hour.
What are the top trends you see shaping brick and mortar retail in the next 3-5 years?
MD: At our company, we’ve been tracking five key trends:
- Extreme retailing will define winners and losers – that is, retailers will win that can deliver on the extremes of how consumers define value: Lowest price, most convenient, best product or experience, and has the deepest relationship with that consumer.
- Technologies will enable retailing on the extremes – such as robotics, AI, instore automation and voice.
- Leveraging stores will be critical to win the battle for the last mile – stores will play an ever more important role to reduce the high costs and inefficiencies of our current consumer-direct delivery/returns models.
- Shoppers want to live and shop more sustainability – this will have a profound impact on packaging, ingredient and manufacturing integrity, food waste and the rise of the rental and second-hand resale markets. Retailers that embrace these values will be well positioned.
- The economy will create more havoc – there have been many retail casualties during the “good times” of the past few years so expect more during the tumultuous times ahead. Retailers must carefully position to survive and thrive.
What technology do you believe will have the biggest impact on the retail industry in the next 3-5?
MD: Technology will continue to change both how retailers do business and the tools available to consumers that will impact how and where they buy. The technology that will have the biggest impact (it is already) is AI. Everything from developing products, assorting, pricing, displaying (in-store and on-line) and replenishing as well as associate service is being changed by AI. AI will more aggressively be entering the consumer realm anticipating and responding to consumer needs.
What’s the future of brick and mortar retail?
MD: Stores will continue to play an important role. Retailers will win in physical channels in the future by excelling on the extremes: Extreme Convenience – providing a frictionless experience in store like Amazon Go vs. Extreme Engagement – providing a unique, highly personal experience based on deep knowledge of the individual consumer. Sephora is a good example of a leader in this area today. In the future, both of these extremes will be accommodated in the same store. The best example of this today can be seen in the Nike House of Innovation in New York City where they support both convenient precision shopping experiences as well as immersive brand experiences under the same roof.