The biggest retail technologies of 2019

Welcome to Charged, our new publication dedicated to providing the latest news, analysis and comment about the technologies driving transformation in the retail sector at such a pivotal time.

Over the coming months we will be examining a number of key technologies shaping not only the way retailers interact with consumers, but how they operate in their entirety.

As the industry is put under fresh pressure from external economic factors, the drive to integrate these emerging technological concepts is accelerating, while investment across the board is increasing.

These conditions make it an especially exciting time for retail, in which new technologies can expand rapidly.

Charged spoke to experts from across the industry to find out which of these technologies are likely to have the biggest impact over the coming months.

 

Robotics and Automation

In April last year Richard Liu, chief executive of Chinese etailer JD.com, predicted that soon the entire retail industry will be operated by robots.

Though it very unlikely robots will anywhere near outnumber the human retail workforce by 2020, they are already being largely integrated across swathes of the sector. Amazon reportedly utilises more than 100,000 across its network, while JD.com operates 15 highly automated warehouses.

“Robotics and artificial intelligence are already being factored into the retail workforce, and this trend is set to accelerate in 2019,” retail technology firm Vodat’s head of sales Paul Leybourne told Charged.

“It’s estimated that four million jobs in the British private sector could be replaced by robots in the next decade, which amounts to 15 per cent of the current workforce, suggests the recent YouGov poll for the Royal Society of Arts.

“Robotics are likely to be used in-store for stock replenishment or to help with product information, cashless payment, click-and-collect services, and to fill shoppers’ baskets. Fashion and general merchandise retailers are working with tech providers to introduce more self-service elements in stores, playing catch-up with the grocery sector.”

Another major aspect of retail that robotics are set to transform is delivery, with the rise of automated land and air delivery expected to play a major part in the future of the industry.

Business networking platform Retail Hive added: “One of the biggest barriers to their take-off may soon be lifted, with NATS – the UK’s leading air traffic control service – stating that routine, out of sight drone operations could be starting as early as this year. It’s dependent on whether reliable technology can be developed that allows air traffic control to communicate with drones effectively – and whether retailers are ready to start using the technology.”

 

WeChat Commerce

The rise of platforms like Alibaba and JD.com both in China and internationally has been slowly but surely shaping the development of retail here in the UK.

Platforms like this have demonstrated two things to the UK retail market, one is that the Chinese market is huge and often hungry for British goods, the other is that there is an awful lot to learn from the innovations in their market.

WeChat, which was one of the largest standalone mobile apps last year with over 1 billion monthly users, could be the next big retail import from China. Put simply it’s an all-encompassing social media platform, the integrates ecommerce, messaging and social media into one experience.

Chinese ecommerce expert and Azoya DACH’s managing director Elena Gatti, thinks WeChat’s ecommerce arm could prove to be a huge opportunity for UK retailers.

“It has a much clearer and more measurable impact on brands’ e-commerce businesses, when compared to other flashy new retail technologies such as VR or AR,” she said.

“WeChat commerce technology is built on mini-programs, which are light apps built within the WeChat ecosystem… Their mini-app nature has enabled brands to not only build WeChat e-commerce stores, but also augment them with functions such as games, videos, public contests, etc. – all of which can be shared with other WeChat users with a few taps of the finger.

“One example is UK beauty retailer Feelunique, which ran a series of group-buying campaigns in the second half of 2018. According to recent figures, as much as 70% of their WeChat mini-program customers were new customers, indicating that the group-buying campaigns have done an effective job at pulling in new customers.”

 

VR & AR

These “flashy new retail technologies” should not be overlooked, as VR technology becomes more accessible while smartphones become more powerful, these new realities are due to play an increasingly important role in the sector.

In a retail landscape where physical retailers are dangerously on the back foot in the battle against online, VR and AR in-store experiences may well offer that edge needed to bring people back into stores.

Leybourne thinks that “augmented and virtual reality will create a whole host of new immersive in-store experiences in 2019.”

“In 2019 bricks-and-clicks retailers are expected to use this technology more proactively, to bring marketing and VIP experiences to life, with the aim of building lasting and lucrative relationships with customers.”

According to the Altus Group, 52 per cent of UK property owners are currently investing in companies which are developing VR and AR technology, suggesting its application could have the potential to raise retail property values.

The number of leading retailers exploring the technology is also growing, with brands like Zara, Ikea and Amazon having already launched engaging experiences.

Voice

With Google, Amazon and Apple all offering their own smart devices the rise in adoption over 2018 was staggering.

According to Nielsen, around a quarter of US households now have a smart device, meaning hundreds of millions of potential customers are on tap for any retailer who managed to successfully utilise this new medium.

This Place’s strategy director Dawn McKerracher thinks that emerging voice technologies present “one of the key opportunities” for 2019.

“The core customer problem we’re consistently solving is removing friction across the digital journey and providing faster, more seamless and intuitive solutions for time-poor consumers on the go,” she said.

“Voice presents a real opportunity here and is something we’re experimenting with for several of our clients and considering – where can voice make life easier for customers across their browse, purchase or support journeys?

“Beyond that, we’re constantly challenging how voice can not only make an experience faster or easier, but also more engaging for customers to help create more stickiness and deeper relationships for our clients.

“Last year, we saw voice and combinations of voice tech starting to gain momentum, so perhaps this is the year where they’ll drive meaningful experience for customers and the right business outcomes for retailers.”

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