supermarkets offering cooking classes, companies are using in-person experiences to connect with customers, even when sales are not involved. In the future, ChatGPT has the potential to generate product . The Future of Experiential Retail - Retail TouchPoints Its aspirational. Retailers as experience designers: Brian Solis on shopping in 2030. McKinsey: Youve mentioned many different types of technologies that retailers could invest in. of business differently. These trends put valuable data in the hands of brands and retail companies. 9 Case Studies That Prove Experiential Retail Is The Future According to Kantars Global Monitor, 79% of global consumers say they are concerned about data protection and privacy on the internet, and 72% believe they are very or somewhat at risk from people or companies misusing their personal data.5. Theyre also the first generation fully raised in a digital world, spending more time online than any other group. One brand that has mastered this concept is adidas; its SAP softwarebased Runtastic app creates personalized experiences and motivation for its global fitness community by delivering millions of personalized messages online every day. For example, Gentle Monster, a sunglasses brand known for their otherworldly store installations, creates a theme around every store that is expressed through unusual sculptures. Brian Solis: I did some work with Westfield, the shopping-mall developer, when it was launching an innovation center and a lab in San Francisco. People want to experience things.. By incorporating biophilic principles into reopened spaces, we offer opportunities to process and release anxiety. The rest of a store will be devoted to experiences a boardwalk-like environment, Damlapinar said, with recreational areas and store-in-store experiences. Personalized experiences such as those created by adidas depend on a high level of customer intimacy, and in the new era of data ethics, safeguarding customer data and privacy is equally important. According to Allied Market Research, the global autonomous last-mile delivery market is projected to reach $90 billion by 2030. Michaels is embracing the next generation of retail focusing on experiences and platforms and rethinking what stores look like and are used for, according to Yaffe and other experts who spoke at the recent MIT Platform Strategy summit. Technology can also generate connections by making every consumer feel like they have a personal shopper who has favorite items (in their size) placed in a dressing room when they arrive or who can suggest similar pieces based prior purchases. Kate Machtiger June 16, 2020 RICARDO ARDUENGO/Getty Images Summary. As we reevaluate spaces, texture, light, sound, and smell should take center stage. When the Web3 wave hits, we're going to have a paradigm shift just like we had in the 90s when Amazon appeared, he said. Jan 7th, 2021. In this environment,reading future of pieces can feel like a trip to the Worlds Fair. This is how you cut through the noise of perfectly posed pastel shots by making people feel something. Then [customers] can purchase the product anywhere they want, because they're not aware of any channel distinction like we are. It can know what transactions Ive made and it can look at other types of data points in real time to know a more inclusive me, a 360-degree me, beyond just what Ive bought at that store. At the same time, online marketplaces will account for 45% to 50% of online spend by 2025. Year-over-year sales from February 2022 to February 2023 show: NRF president and CEO Matthew Shay doesnt find Februarys sales growth surprising. The concept of "going shopping," which might look like blocking off an hour or more to peruse physical stores or eCommerce shops, will have become nearly obsolete. The worlds retailers face a host of challenges. Any advice for retailers on that front? Opinions expressed by Forbes Contributors are their own. Will it be good enough for us to be incrementally better? Theyre expecting a richer range of experiences that blend retail, music, dining, and entertainment, for example, which is why futurists see a resurgence in shopping malls by the middle of the decade. The so-called "death of the high street" is well publicised but while some traditional retailers are struggling, the sector's seismic change could bring about a renaissance where hands-on experiences transform shopping trips. The pandemic brought that future forwardbut few retailers were fully prepared for the scale of the digital shift and its impact on the bottom line. People will discover new products and services while scrolling through social feeds, watching streaming videos, and playing video games. But bad physical retail will go away: the retail space solely designed around sales per square foot," says Shopify's Loren Padelford. Now is the time for retailers to commit to fully integrating online and offlineand resetting the purpose, function and operating model of stores. The additional costs associated with serving online customers are unsustainable without a step change in the business that works for all stakeholders. Ray works with retailers on digital transformation and innovation of the retail customer experience in stores. At the same time, it offers retailers a vision of a world in which more ecommerce doesnt have to mean lower profitability. If you are reopening imminently, consider what touch points could be improved to minimize contact and increase personalization. SAP Emarsys Customer Engagement platform provides the provides a trusted and robust omnichannel experience retailers crave. There won't be physical products. Online sales accounted for 14.5% of total retail sales in the second quarter of 2022 a 7.4% increase from the same period a year earlier. Self-checkout, for example, has not reduced the number [of employees] working in stores. They need actionable vision that will set them apart. Retailers need to appeal to Gen Zs specific habits and preferences, such as how they seek out input from trusted sources online. Future of Retail Stores | Deloitte US Learn more. Laurent leads Accenture Retail in Europe and Consumer Goods in France & Benelux, and helps clients transform through innovation and technology. The good news is innovative ways of operating were already being prototyped on a smaller scale before Covid-19. Retailers and brands that want better odds at retaining customers should innovate their offerings through partnerships and collaborations. Intelligent supply chains also allow retailers to respond more quickly to disruption. Complete your profile for personalized recommendations, Senior Director of Retail & Merchant Marketing. . The other path is, Were going to innovate and reimagine what shopping should look like in 2030in a way that the customer either already wants or doesnt know yet that they wantand once they have it, theyll feel like they cant live without it. In my work, I focus on the latter. In fact, at least 70% of people say they are willing to continue buying from companies that increase their prices if they feel valued as a customer. Indeed, consumer expectations around personalization are increasing, with 73% of shoppers expecting brands to understand their unique needs and expectations. It should just be in the background. In parallel, PwC's June 2021 Global Consumer Insights Pulse Survey found that consumers have evolved to become more digital. While the platform was successful, Nestl didnt monetize it, and all the money went directly to the trainers. Finally, the State of Consumer Behavior 2021 report found that 90% of. In 2030, opportunities to purchase will be enmeshed in our daily lives, instantly bridging the gap between inspiration and purchase. For years we've heard about the decline of physical retail and the rise of the internet. But consumers in 2030 wont want to shop the way they did in 2020. According to Allied Market Research, the global autonomous last-mile delivery market is projected to reach $90 billion by 2030. Maybe stores are only one typology in an array of ways we could interact with products. 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Retailers outside of the essential category need to think about space as a service a performance, where front of house is serene, while back of house supports the complex maneuvers that occur on stage. Early studies show that 15 minutes in these recharge rooms can reduce reported stress by 60%. McKinsey: You have an unusual job title. This is a highly competitive industry in a very tight labor market, so we dont see reasons to believe that there will be a displacement of workers., NRFs calculation of retail sales focuses exclusively on core retail sales and outlets and excludes automobile dealers, gasoline stations, and restaurants. Most online shopping experiences were built on generic templates, but with millennials and Gen-Z funneling themselves into ever-narrower aesthetic tribes, online shopping no longer has to cater to the masses. Physical spaces will look and feel vastly different post-Covid. Brian Solis is Salesforce.coms global innovation evangelist. When we get caught up in profit, we start getting caught up in costs, and then the conversations about innovation and the future of retail sound a lot like, Lets just do what weve been doing, but slightly better. When were not willing to give up any profitability or shareholder return, that can hold us back from potential growth. Cookies help us deliver our services. Instant Shopping Becomes Truly Instant. The right customer and the right message will be a moving target. No experience can be perfect without a flexible and resilient supply chain. May 25th, 2023, 11:25 AM PDT. The future of retail banking and the consumer experience. With store operating models established in a pre-digital agewith stores designed to optimize foot traffic and traditional shopping journeysfew retailers were fully prepared for the recent shift to digital on this scale or at this pace. That optimistic outlook is underscored by Easter spending this year, which is projected to reach a record-setting $24 billion, topping 2021s $21.7 billion and 2022s $20.8 billion. ), When the pandemic first sent millions of American home, temporarily shuttering many retail stores, there were concerns about it being a death knell for the industry. To help accelerate the OMO model, Accenture has developed an innovative new concept for the Store of Tomorrow. Findings. PDF The future of retail - Deloitte US These feelings can then be translated into digital shopping formats. This includes super apps, like Rappi in Latin America or Grab in Southeast Asia, that centralize different customer needs in a single place, buy-now-pay-later financial providers like Affirm or Klarna, loyalty aggregators, social-media apps, and last-mile fulfillment providers. 3, 2022. Grand View Research evaluated the market value at USD 5.79 billion in 2021 and this is expected to grow at a 23.9% compound annual growth rate (CAGR) from 2022 to 2030. Figuring that out takes imagination. By 2030, 5G will have given way to 6G. Art students signed up for classes, and also bought supplies at the stores. Brian Solis: There are two ways that 2030 could play out for a retailer. MANAGING DIRECTOR ACCENTURE STRATEGY, RETAIL. Whats the draw? Subscribe to the Retail Dive free daily newsletter, Subscribe to Retail Dive for top news, trends & analysis, The free newsletter covering the top industry headlines, By signing up to receive our newsletter, you agree to our, Webinar Topics covered: e-commerce, payment technology, IT, in-store tech, cyber security, and more. [alt text] A circle graph showing that 42% of Gen Zs spending is in physical stores, next to a circle graph showing that 38% of millennials spending is in physical stores. Walk us through the shopping experience in 2030. This positive sign for retailers follows 2022s 7% annual growth over 2021, with retail sales reaching $4.9 trillion. But from 2019 to now, retail sales have seen astounding growth of 30%. Last but not least, retailers need an engaged staff that not only serves shoppers but understands their needs and knows how to create customer intimacy. If our content helps you to contend with coronavirus and other challenges, please consider, ManvsMachines recent campaign for Purple. They spend about 700 million dollars a year in the United States alone on experiences, with the primary objective of first party data and building these relationships, Yaffe said. What Will the Retail Experience of the Future Look Like?