A new year is a time to look forward and think about what will shape the future, and in this, my first article of the year, I’ll be exploring the top five trends in retail technology for 2022.
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Retail technology has been a lifeline to retailers over the last couple of years and without sophisticated systems, many retailers would not have survived to open their doors at the beginning of 2022.
Many retailers have a stronger sense of optimism than they have had for a long while. Much of that is based on the transformations they have seen wrought by effective, ground-breaking retail technology – transformations they want to build on and enhance.
Retailers have long understood the value of using data to make recommendations and help customers find what they are looking for faster. But two marketplace shifts have rocketed personalisation into being one of the top retail technology trends for this year. Firstly, there has been a massive growth in digital shopping, as retailers who couldn’t open their doors over the last two years (or whose shoppers were reluctant to come into the store) relied heavily on sophisticated ecommerce solutions. That has given them the chance to collect more detailed data about their shoppers, and use it to create a ‘single source of truth’ about their customers’ preferences.
Secondly, shoppers themselves are placing ever more value on personalisation as a key element of a customer experience. A study by PWC shows that customers are willing to pay up to 16% more for a great experience and 63% say they would share more information with a company that offers it.
#2. Modernised checkout experiences
As customers move back into the brick and mortar store, they still want the streamlined checkout experience that they have got used to online. They want fast, easy, contactless payments. Combine this with the massive growth in wearable devices – the market is set to almost double between 2022 and 2025 – and we’re seeing a dramatic shift in the way shoppers pay for their goods in 2022 and beyond.
Wearable payment devices include watches and wristbands, bracelets, rings, cufflinks and clothing – such as the shirt that holds an NFC payment chip in its cuff.
Adapting to these new payment trends is an important element in the strategy to win and retain clients, because preferred payment method acceptance is the most important attribute when consumers are shopping at stores. In a survey, 47% of respondents said that availability of contactless payments would increase their in-store shopping comfort.
The growth of ecommerce solutions also saw the increase of the associated new channel/delivery models such as Buy Online Pickup In Store (BOPIS, or Click and Collect) and Curbside Pickup. Customers are comfortable with these ‘brick and click’ online/offline integration shopping models, and the trend continues. As I wrote about last year, a smooth and easy returns process is an essential component of an ecommerce solution, and 2022 will see Buy Online Return in Store, or BORIS, become ever more popular.
Alongside this, the ever-rising use of mobile devices whilst shopping has spawned the trend to Browse In-store, on Mobile, Buy Online, (BIMBO). Retailers need to understand these customer-led models and turn them into smooth and seamless transaction opportunities.
#4. Augmented and Virtual Reality
As shoppers return to stores, they want a better experience than before. Smart retailers are picking up on the trend of using augmented reality (AR) and virtual reality (VR) to take the customer experience to the next level. An article in the Harvard Business Review tells how one clothing retail giant has introduced virtual fitting rooms, where ‘magic mirrors’ show the customer ‘wearing’ the items they have selected. In other retail stores, shoppers can try on virtually, then use an interactive screen to order the items they have selected, and some retailers use artificial intelligence (AI) to make personalised suggestions for complementary items, increasing customer satisfaction and basket size
#5. Inventory Visibility: having the right inventory at the right place / right time
This explosion in online/offline integration, with new shopping and returns channel models means that the lines between store and distribution centre are blurred. The trend towards being able to manage inventory in one place, and fulfil/return goods to any location is one that started over the last couple of years and is set to increase in importance in 2022. Flawless inventory management underpins all four of the other big trends for this year.
The trends for 2022 are born, in part, from the disruption of the last two years, combined with the demands of shoppers as they return to stores. eCommerce solutions are here to stay, as are online/offline integration delivery channels and the need for inventory visibility. As shoppers return to the brick and mortar store, they’re demanding increased personalisation, contactless payment and AR and VR retail technology to give them an outstanding in-store customer experience.
For retailers who understand these trends and make the most of what retail technology can offer, 2022 promises to be a very promising year.