What the Future Has in Store: The 5 Pillars of the 2020 Retail Reality

April 29, 20208min

The extent of change in the retail industry has been remarkable. People are talking to personal shopping robots, storefronts are morphing to mirror passers-by, and consumers are using hand-held computers to digitally try on clothes from the comfort of their own homes.

As a result of these changes, the evolution of traditional operational models and other trends that will present significant opportunities for digital retailers fall into 5 broad categories.

1. Options for Shopping Channels and Devices Will Continue to Grow

Omnichannel retailers use technology to tie together shopping channels to “…create a unified shopping experience across every single device and channel that a consumer uses to interact with their business.”

This approach to retail provides consumers with a seamless and continuous flow at every touchpoint regardless if they’re researching or making a purchase. And, omnichannel retail product and content delivery is practically a requirement for brands that want to remain modern and competitive.

The average digital consumer has five profiles across various online channels. And the majority of them expect consistent interactions across every profile they use to shop and interact with retailers.

What’s more, omnichannel shoppers spend an average of 4% more on every in-store shopping trip and 10% more online. Compared to single-channel shoppers, omnichannel shoppers visit their favourite retailers’ 23% more often and have a 30% higher lifetime value. Yet, 55% of shoppers still say their retail experience is “disjointed” when switching between channels, and only 22% of North American retailers consider omnichannel retail a priority.

There is a significant disconnect between today’s shoppers and retailers—which presents a critical opportunity for ecommerce businesses that can provide seamless products, content, and experiences across channels.

2. Shoppers Will Use Augmented Reality to “Interact” With Digital Products

Augmented reality (AR) technology enables shoppers to use cameras on their smart devices to display digital elements in the physical world. Brands like IKEA and Converse are setting the standard for how brands can take advantage of AR to enable their shoppers to get a “feel” for products before purchasing them online.

IKEA enables shoppers to use their smartphones to virtually “place” furniture in their homes so they can visualise how certain products will fit into the space before making a commitment. Converse’s smartphone app helps shoppers virtually try on shoes and share their AR-enhanced pics on social media!

3. Facial Recognition and Device Tracking Will Become The Norm

In 2020, retail businesses will hone in on omnichannel marketing and sales by integrating data gathered in-person with online customer profiles. This type of tracking is possible using radio frequency identification (RFID)-enabled beacons and WiFi to track devices, sensors to monitor movement, and cameras and facial recognition software to identify specific consumers. Retailers will finally be able to understand how shoppers interact with their physical stores the same way they use analytics tools to tell what’s happening in their digital ones!

Bringing together web, mobile, social, and now in-person data will put retailers in a position to provide 360-degree customer experiences in 2020.

Using smart cameras and sensors, Eyewear retailer BonLook can tell you how many glasses-wearing women in their target age range walk by any one of their shops, at any given time, on any given day.

Furthermore, they can break down how many of those people came into the store and how many completed a transaction. Using this information, BonLook was able to grow their conversions overnight just by updating their storefront advertising to better appeal to the group of passers-by whom they wanted to convert.

4. The Advertising Model Will Morph Into Something New

Google, Amazon, and the big social media networks like Facebook, Instagram and YouTube dominate digital commerce advertising. Google and Facebook combined take in 61% of all digital advertising spend in the U.S., on average.

Over $270 billion was spent globally on digital ads in 2018 alone. Americans are exposed to between 4,000 and 10,000 advertisements every single day—and at least 75% of them engage in at least one form of ad-blocking. Consumers are overwhelmed, jaded, and less and less likely than ever to click on traditional, “interruption-based” ads.

Hence in 2020 and beyond, we’ll see advertising become more non-traditional, experiential, and naturally embedded in everyday experiences. A great example is Procter & Gamble’s Bare Skin Chat YouTube series, which features relevant celebrities in entertaining videos that are both engaging and informational—and has millions of views. In 2020, digital commerce advertising  will be driven by creating experiences that consumers want.

5. Voice-Based Digital Commerce Will Generate Billions

Smart speakers are no passing trend. In 2018, there were 2.5 billion voice-enabled devices. Predictions are that by 2023 there will be 8 billion of them.

By some estimates, as many as half of all searches may be done by voice in 2020. And how about the voice-powered shopping market, specifically? Estimates are that the market is going to exceed $40 billion by 2022. If businesses are not optimizing the products and content on a website or app for voice search, then 2020  will see them upgrade.

The need for consistency

To drive consistency across this scope of technologies, a flexible and scalable CMS is paramount.  A headless content management system (CMS) is a key tool in empowering retailers to create content once and publish it everywhere.

Because a headless CMS has no built-in front-end system that determines how or where content will be displayed, content managers can serve consistent content experiences across websites, apps, chatbots, connected home devices, voice assistants, and more.

It is entirely possible that to span the most basic customer journey, a business will need AR app integration that allows shoppers to interact with digital products, facial recognition and smart software gathering in-person data.  The new reality of retail is not just the old adage that retail is detail but that detail is now in the highest of definition from multiple sources.

Sonja Kotrotsos

Sonja Kotrotsos

Sonja Kotrotsos is Head of EMEA GTM & Alliances at Contentstack.

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