It’s retail… but not as you know it!
Propelled by an increasingly online, experience-driven consumer, the past decade has seen a radical transformation in Australia’s retail scene. And with seismic shifts expected in the wake of retail giants like Amazon adopting artificial intelligence (AI) technology this trend looks set to continue. Yet consumers are not entirely familiar, nor at ease with the concept of AI. So, what does this mean for the future of Australian retail and consumers?
It begins with the very reason so many consumers are taking their shopping online: time. Less time spent at the checkout, waiting in queues and comparing prices makes buying online attractive and convenient. Consumers want freedom and flexibility to purchase what they want, when they want – a preference that has seen sites like Amazon and eBay grow at a phenomenal rate.
Yet whilst consumers have been quick to take many purchases online, one category has not kept pace, namely grocery. In this category, customers have traditionally preferred to be hands-on, due to the personal nature of the grocery shopping ritual, along with the perishability of and individual tastes around fresh produce.
But now even these areas of grocery have undergone a transformation, with consumer desire to be personally involved in their selection being replaced by, you guessed it, convenience. The overall online grocery shopping has grown more than 23% in the last 12 months, but along with it a new category of fresh ‘convenience’ produce has been born. In the name of keeping up with a busy lifestyle whilst making healthy choices, items like ready-peeled vegetables and chopped salads are finding their way into more and more shoppers’ trolleys.
And it’s in the trolley that AI technology is now looking to meet consumers. Microsoft is currently exploring ways to challenge its nemesis Amazon after the online giant launched its cashless and check out free concept store, ‘Amazon Go’ in Seattle in January 2018. The store, which relies on a smartphone scan as customers enter, numerous in-store cameras and sensors to monitor what they take off the shelves, and on-file credit card details for automatic billing, has an expensive and somewhat complex tech footprint.
In contrast, Microsoft is considering a more streamlined concept that leverages in-trolley cameras linked to the cloud. Using sensors to monitor and record what goes in the trolley, this scalable concept is expected to be a good fit for large retail environments like supermarkets and discount department stores – and has the potential to help further systemise the many stores that already support cashier-less and ‘scan and go’ checkouts and increasingly popular contactless payment options like Google Wallet and Apple Pay.
To effectively shape the algorithms and refine the sensors needed to make this work seamlessly is going to require a lot of shopper behaviour and purchase data. This means we’re likely to see the introduction of many more new concept stores similar to Amazon Go, as well as the trial of different types of data capture technology such as facial recognition – a concept which is already being tested by China retailer, JD.com.
This all adds up to an exciting time for Australian retail and Australian consumers. AI technology already pervades many areas of our lives – if you’re doubtful, just ask yourself who you were talking to when you last said, ‘Hi Siri’ or ‘Hey Google!’ The direction our retail industry takes will likely be greatly influenced by the big technology players like Amazon and Microsoft – but like social media it will also be user-led, giving consumers a unique opportunity to define what convenience means to us, and determine how we want the future of retail to look. What it holds may be unclear, but one thing is certain: it’s retail, just not as you know it.
If change and meeting your customers’ needs is constant, doing nothing isn’t an option. Be sure you are partnering with a company with the depth and breadth of expertise you require. Particularly one who can help you navigate end-to-end managed services, cloud, mobile and paperless retail technology. GPK Retail consultant, Cordell Quaine, is available for a no-obligation discussion on how GPK can help you reduce operational costs, manage your IT footprint more effectively and create an exceptional experience for your customers. Contact: Phone 1300 000 475 or email [email protected] for more information.