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 a recent interview with The Robin Report founder and CEO Robin Lewis.
What personally excites you the most about the retail industry?
RL: The technology age is equivalent to the industrial age in their impact on all industries. I have said the impact on retailers is equivalent to the buggy whip manufacturer watching the first Model T Ford roll off the assembly line. They quickly understood that they would either have to transform the business they are in, or get into another business. So this dynamic is changing daily. It’s a seismically shifting space and it’s exciting to observe and write about what it all means. What is the future going to look like? Nobody really knows. There are hundreds of new models launching every month. There are brick and mortar retailers failing every month. And there are legacy giants who are massively transforming. There are exciting things to wake up to every morning.
What has been the most dramatic change you’ve seen in the industry over the past 3-5 years?
RL: Technology – mainly AI — has rendered consumers transparent, enabling retailers to capture their entire lives, including shopping behavior, even to the point of following and communicating with them through the store. They analyze them at each and every browsing and transactional point of contact. All of this data is then used to personalize the products and services for each consumer. Amazon is way ahead of the legacy retailers, to the point where they are now using predictive analytics. Across many categories, they are able to send a consumer the item needed, before the consumer even knows they need it.
What are the top trends you see shaping brick and mortar retail in the next 3-5 years?
- AI and personalization
- Fluidly Ubiquitous, Laser-like Distribution and Platforming
The consumer as POS is a moving target. Therefore, every supply chain must be capable of reaching every one of those personal points of sale, physically and digitally. Through AI and the personalization process, it’s possible to find where each of your core consumers reside in the physical world and commerce must go to them. Platforming or the retail brand, such as Nordstrom sharing its platform with rent the runway and other brands, or Kohls hosting Amazon, WW and planet fitness, Macy’s with Apple and Thredup and on and on. And even with competitors. This will accelerate because it creates a great synergy, increasing traffic.
- Experiences and services: entertainment, treasure hunts, restaurants, salons, yoga, fitness centers, ski slopes, education, events, etc.
Retailers must figure out what experiences fit into their brand’s DNA. And services like Costco’s gas pumps, RV rentals and dozens of others, which account for 20 percent of their $150 billion revenues, can also provide huge cross-over revenues while adding to the experiences.
Augmented reality is an engaging strategy that creates frictionless, co-created entertaining shopping experiences such as interactive touchscreen kiosks or windows, 3D imaging, virtual fashion mirrors, interactive dressing
rooms, robot assistants, streaming videos and more on the way. Tech adds dramatically to the overall shopping experience.
- Sales Associates as Brand Ambassadors
The sales associate’s role is more critical than ever. This human being, typically called an associate, should be educated to earn a master’s degree in customer engagement, brand ambassadorship or in empathy. The associate is the final, most important link in the value chain – the link that touches the consumer at point of sale where the purchase begins or ends. Nordstrom hires associates primarily on the basis of the person’s interpersonal skills, empathy, engaging and just a nice person, over any past retail credentials. As Blake Nordstrom once said, “we can train people to understand retailing, but we can’t train them to be an engaging, empathetic, nice person.”
What technology do you believe will have the biggest impact on the retail industry in the next 3-5?
RL: AI – machine learning, voice and visual commerce, robotics, computer vision.
What’s the future of brick and mortar retail?
RL: Demassification and fragmentation of big box giant retailers into more but smaller neighborhood boutiques, events and experience driven, curated/personalized, through AI, stocked with precisely what consumers in those communities prefer.