Among the many topics covered in the recent three-day annual summit of the South African branch of Singularity University (or SingularityU), which hosted a terrific international line-up of speakers, was the new world of retail, which merges traditional and online shopping in exciting, innovative ways.
In her presentation “The Retail Revolution”, Kayleigh Fazan, founder and owner of the International Retail Academy, said this revolution was happening under our noses.
“In 2020, $4 trillion was spent online, a staggering third more than 2019. Of course, 2020 was a far-from-normal year, but nonetheless … Oxford Street department stores have closed. Global brands have vanished. Businesses are disappearing overnight. It's shocking to see.”
She said three key trends were happening in retail:
1. Retail is un-retail. Shops are springing up that don’t actually sell products. “An example is Samsung 837, the Samsung concept store and repair service in New York. Nothing inside that space can be physically bought except the coffee. Imagine thousands of square feet with no sales budgets and no inventory. The space is filled purely with experiences. Another example is the demonstration store in which, again, nothing is actually sold. Instead, everything is shipped,” Fazan said.
2. Omni-channel is yesterday’s news. “It is no longer enough to simply have an omni-channel marketing strategy (using both physical and online channels through which to sell a product). Global consumers now demand a unified experience, allowing them to move freely and smoothly across channels with live visibility of inventory and pricing.”
3. The store as a stage. “If you’ve heard of retail theatre, you’ll know that stores have activation days, seasonal offers, promotions and campaign launches, but these don't last. They are moments in time. The stage goes back to normal and consumers dial out.
“Millennials scroll through an estimated mile of content every day. This suggests that the mobile phone offers things that the store environment is currently lacking and consumer expectations are changing rapidly. Retailers need to build a star cast of employees, consider their products as the props on the stage, while their customers are the audience.”
In another talk, “The Future of Shopping”, Elizma Nolte, regional marketing manager at Facebook Africa, also identified key trends among consumers and retailers, mirroring Fazan.
“The future of shopping is an exciting space where online and offline will be merged. It's going to bring new digital experiences to our lives, be immersive and allow for experiential shopping,” Nolte said. She said social media has really become the way for people to discover products. “Online consumers are embracing digital tools and they want brands to meet them in that space.”
Another trend is “shopper-tainment”. Said Nolte: “People don't just go shopping because they need to get something; they go shopping because it's fun, it's an experience, a way to hang out with friends. This has led to the rise of live shopping. There’s been an incredible 200% increase in live shopping over the past year, and research done in emerging markets, including Africa, showed an increase of 68% in live shopping over the last year.
“This trend is very fashion-focused at the moment, but what about sports equipment and auto accessories? It’s all about adding experiences, across many different products, again and again. People want brand interaction, for brands to respond to their comments or queries and to assist when something they want is not available.”
The third trend Nolte identified was augmented reality. “Augmented reality is really helping bridge the gap between offline and online, as it works through the entire shopping funnel. For example, if there's a sofa you’re thinking of buying, augmented reality lets you see what it would look like in your own living room. There is much excitement about augmented reality with 75% of businesses globally stating that they are looking at using augmented reality in one way or another, a figure that is up from 40% in 2020,” Nolte said.
She said a big problem is that there is growing demand for products and growing demand for experiences, but we don't have additional time. “This is where we rely on recommendations, and usually a machine is making the recommendations. Netflix has been doing it for a very long time – 80% of content that you watch on Netflix is because Netflix recommended it to you. Spotify is very similar: over the last five years, they've driven 2.3 billion hours of music discovery.”
Nolte said artificial intelligence would be used more and more across retail and social platforms to refine the recommendation process. “The machine will learn what you're interested in and present this to you in fun and interactive ways.”