An evening with IBM and Retail Reflections
We are living through the biggest period of disruption and change ever to impact the retail industry.
We hear it every week: profit warnings, CVA’s and once great retail businesses going into administration; Darwinism on the High Street - if you will – is now a stark reality for us all.
To try to make sense of all this, IBM and Retail Reflections hosted a retail roundtable dinner. Held at the Gherkin in London the event gathered a group of senior retailers to discuss the state of the High Street and much more.
As Founder of DFS, Lord Kirkham put it: “Embrace change – and do it now”.
Held shortly after NRF in New York and more recently Retail Week Live in London, there was plenty to discuss. And emerging from both retail conferences were three stand out trends:
Role of the store
Artificial Intelligence (AI) is perhaps the biggest and most significant change the retail industry has seen for decades and there was plenty of discussion around just what AI is and what AI isn’t.
And in a stark word of warning to all retailers, “If you haven’t begun your AI journey yet, you’ll never be able to catch up”.
There is a certain amount of irony in the fact that online continues to grab all the headlines and yet only accounts for around 15-17% of sales (depending on which part of the world you’re in).
So it seemed natural to discuss the role of the store which is now rapidly evolving from a place simply to keep the stock dry to the new battleground of retail where the experience is everything.
And in this context, the ways in which physical can be merged with digital was the focus of much discussion.
Those who are able to a) use an appropriate blend of technologies and b) create a seamless physical / digital in-store environment are those more likely to succeed.
Which brought us nicely to the 3rd key trend – that of frictionless commerce. It’s long been known that the shopping journey needs to be easy and convenient but this is being acutely felt now – in an age where if your website takes more than a few seconds to load, you’ve lost that customer.
Less tolerant, impatient, more demanding than ever before; the margins for error are at best slim if you are to attract and retain today’s tech savvy consumer.
What Trends Will We See In 2018?
We concluded the evening with a literal roundtable; the subject? What trends are we likely to see in 2018? There were some interesting views.
As expected, AI featured; it is pervasive in pretty much everything. Blockchain was another technology raised, beware estate agents – your days could be numbered; maybe a reinvention is required?
Ease of checkout echoed the frictionless discussion and it is clear that the entire checkout / payment process will in future be transformed.
There is clearly a shift in the ways that consumers wish to interact and whilst technology must be kept in its rightful place – unobtrusive, enabling rather than confusing – the right mix of technology is key to addressing shortcomings and failures.
Final mile fulfilment was another topic discussed; now more important than ever before – a brand’s ability to deliver whenever, wherever will largely come to define it. Supply chain flexibility enabled by inventory visibility is now vital for any retailer.
The sheer pace of change and innovation can at times be bewildering. For those retailers still clinging to the belief that past working practices will continue to work – a nasty shock is just around the corner.
It’s sometimes difficult to appreciate that what we are experiencing in 2018 is not just another trend but that we are living through a seismic revolution in retail.
Old ways no longer work, are no longer relevant. It’s time to throw away the rule book; retail is dead, long live retail.
Andrew Busby is a retail analyst, founder of Retail Reflections and an IBM Futurist