Howard Pull, Strategic Development Director @ MullenLowe Profero
Retail is a £365bn industry in the UK, and with 18% of all retail sales being online there are still opportunities for digital services to expand and influence the customer journey.
In 2019 we can purchase almost any object or experience through the internet, but it’s still a clunky experience in many ways, and when we set foot into a store to access products IRL that complexity grows.
Tech brands, that have set our expectations of what simplicity feels like in the online world, are set to smash new barriers that we didn’t realise, or have conveniently forgotten, we had. Problems like long queues, finding advice and trying before you buy are all set to undergo another wave of transformation in 2019.
Buying without barriers: The Top Line
From: old school checkouts and buy buttons
To: frictionless behaviours hitting IRL retail
2019 Tipping Point: Amazon Go and Amazon Wardrobe put new purchase behaviours within the reach of the mainstream
Smart Stores move from pilot to high street
According to Internet Retailing, today more than half (57%) of UK shoppers opt to avoid human interaction during the retail experience if given the option. Amazon Go, the cashier-less store powered by computer vision will roll out smart stores in London’s Oxford Street in 2019,and is set to open in 3,000 Amazon Go stores in the US by 2021.
With the democratisation of AI we see big tech opening up services to brands to allow you to get the Amazon Go experience without hiring an army of PhD graduates. Microsoft & Kroger are exploring their own US pilot of a connected store experience, with a view to developing a ‘Retail As A Service’ (RaaS) offering. This creates digital shelves with enable hyper-targeted ads, leveraging personal data and in-store video analytics. At its simplest, it could mean customers seeing an icon once in an aisle, to flag a product that’s on thier shopping list.
A Try Before You Buy World
Returns have been the grind of many online retail brands, and a lot of effort goes into predicting the right products before you click buy and dissuading you from returning them; H&M reported they have $4bn in unsold stock in 2018.
Amazon Prime Wardrobe embraces this behaviour and lets you experiment. Rolled out in the UK in winter 2018, Amazon Wardrobe brings “try before you buy” shopping to the fashion mainstream. Customers can order up to 8 items with no upfront cost, only paying for those they don’t return.
Removing human gatekeepers
We spend £2,892 per year on healthcare for every person in the UK (Source: BBC), and like retail it has many friction points in the journey for people to access products and services.
A standout innovation we can learn from is Ping An’s Good Doctor ‘1 Minute Clinics’. China based Ping An is the largest mobile/AI Health tech company in the world with 228m registered users.
Ping An are trialling unmanned clinics combined with smart medicine cabinets. Powered by an AI diagnosis tool it covers 2000 common diseases and can automatically dispense from a range of 100 medicines.
What should brands do to embrace this trend?
- Can digital innovation open up a try before buy model — is there an opportunity to make returns frictionless and get more people to sample your products?
- Learn from Amazon and Walmart to bring digital techniques to solve IRL store problems.
- Look for opportunities to automate advice & instant fulfillment for products where customer choice and reassurance is a barrier.
This article is part of MullenLowe Profero’s 2019 Experience Transforming Trends.
The report covers seven areas that the agency believes will make the biggest impact on how consumers interact with digital experiences in 2019 and can be found here.