Industry TalkRegular Industry Development Updates, Opinions and Talking Points relating to Manufacturing, the Supply Chain and Logistics.
The current IT landscape & what the trends will be for 2023
What did you observe this year?
One of the biggest moves this year has been the continuing transition from hybrid to omnichannel customer journeys. When the pandemic started, everyone went online and it was convenient: you could use online tools everywhere from your phone, you could do all the new things from your car, in the gym, etc. This caught on with many retailers.
When we start that online journey, for example, players can start to build their infrastructures. Nike or Unilever can now sell to you directly, and they’ve started to do so. But the pandemic came to an end and people started to return to brick and mortar stores, keen to feel merchandise in their hands. Some luxury brands continue to have their offline presence.
That’s a question to answer: how will certain players combine those two channels, online and offline? Everything’s changed and it’s never going to be the same as before the pandemic. People continue to go through the online experience, but they expect to have the same experience offline. For example, now everyone expects to have any size, any color, almost immediately. The online experience has increased expectations for the offline experience, and retailers have to find the way to meet those expectations.
It would be useful to have some additional features, like virtual fitting rooms. In many places, you can already have an offline-type experience when you go to an online shop: you can try on different colors within an AR environment.
The second trend is that now consumers are thinking in earnest about the impact of the products they buy. They are increasingly conscious of the environmental and societal repercussions of a purchase and about the corporate governance of the company that made the product. Consumers are putting more pressure on brands to be accountable for the entire vertical of their choices, and this is changing the industry. Everyone wants to know the entire history of a product. Consequently, brands need to provide greater transparency in the supply chain and elsewhere. Transparency and accountability for entire supply chains in the retail space will be a hot topic for the next couple of years.
There are many interesting trends in conscientious retail. For example, previously, you could go to a large online grocer and say, “I’m a vegetarian, so please show me products that fit my preferences.” Now, more and more online shops are introducing the ability to say, “I want to reduce my carbon offset; which products should I buy?” Of course, retailers carrying products that fit the bill will have an advantage because, when comparing one apple to another apple, the buyer will now know that one of them has a reduced carbon footprint because it’s grown locally, and this will influence that buyer’s behavior.
The greatest consumer demand will be for data personalization in customer journeys. Consumers want a personal experience. For example, go to Nike and you can have completely customized sneakers created for you. In some shops, they might print them for you. Some fashion retailers could create new blouses with fully customized prints.
At the same time, companies are using data to better understand customer habits. They want to know what the next trends will be. What are customers likely to buy in the nearest future?
It’s more and more common to use data and machine learning: depending on which music you’re listening to; you’ll see different advertisements. This is a huge industry, using ML to know what you are thinking about buying. You go to Instagram or Facebook, and they immediately offer an online retailer for you. They use data from \your applications (if you allow it, of course). They predict your taste and buying choices, and this is likely to continue.
The key technology for the next few years will be rooted in data first, and after that, machine learning.
People are still talking about VR, but there aren’t many uses for it. Companies will continue to experiment, but there’s no guarantee of huge success. A case in point is the metaverse, et al.
We expect cashless and contactless autonomous shopping continue developing as one of the huge technology moves out there. Right now, more and more retailers offer the ability to avoid communicate with a cashier at all. You just pick something up and go; this isn’t just Amazon grab-and-go shops. By reducing interaction, the retailer reduces the barriers between you and a purchase. This technology is also reliant on machine learning and connected devices.