The technological disruption in the retail space has made the consumer more connected with devices through online shopping, e-medicines, payments etc. As a result, consumer demands have evolved dramatically and they prefer 24/7, quick and easy shopping experience.
With the adoption of technology, brands are now successfully delivering a better consumer experience and can even predict the trends well in advance. Even brick-and-mortar stores are increasingly adopting e-commerce models considering the demands of the present day market. This trend has evolved more amid the pandemic when offline retail has been hit particularly hard and online retail boomed more rapidly than ever before.
With 2020 being the year of key innovations, disruption and a major transformation of the retail industry, 2021 is expected to be a year of several key technological advancements around IoT, mobility, digital wallets etc. Let's talk about how the world of retail and e-commerce will continue to change throughout 2021.
Diffusing Lines between Online and Offline
With increased adoption of mobile devices, voice assistants, AI, IoT, Robotics, AR and VR; retailers are now trying to bring the comfort of online shopping to offline stores, whereas, e-commerce is exploring innovative strategies to bring the rich interactive environment of offline shopping to e-commerce. This evolving trend is a big one! While offline retailers have been already adopting online business model, more lately, an innovative trend has emerged. Online retailers are now focusing on bricks and mortar presence, for instance, Amazon's has opened cashier-less stores in the US. Further, many small start-ups are collaborating with bigger brands to expand their business. As we are entering into a new year, it would be interesting to see what shopping looks and feels like.
Artificial Intelligence and Augmented Reality
According to a Juniper Research report, retailers are expected to spend $7.3 billion on AI by 2022. This is a huge rise from $2 billion they spent in 2018. AI-driven big data retailing has been in the space for a few years now, however, its efficiency and techniques continue to enhance the customer experience. Major retailers rely on advanced analytics and AI for being the personal guide and in-store assistant.
Further, in 2021, we can expect robots to take to the shop floor after successfully assisting with inventory management in warehouses. Also, Augmented Reality (AR) will help in enriching the online shopping experience and allow customers to see how a certain product would look before they buy it. Lastly, just as AI-powered voice recognition is becoming increasingly common to control our devices or search the internet, we will use them to extract information and make purchases.
More Solutions in the Last-mile and Autonomous Delivery Space
Partnerships with last-mile delivery companies will increase as retailers will seek to leverage their physical stores to fulfill locally placed online orders. Additionally, there will be more technological advancements to tap geography like India where still a huge part falls under the undeliverable category. We will likely see drone delivery vehicle and self-driving delivery vehicles coming to life in some parts of the world.
Niche B2B Platforms Continue to Rise
Instead of shopping on comprehensive e-commerce platforms like Amazon, where a specific product search gives thousands of confusing options, consumers increasingly prefer niche platforms. They offer a more tailored experience, simpler user journey and are less time consuming. These platforms are expected to continue doing well and rise in number considering the positive consumer response. Therefore, more retailers will resort to B2B trade platforms.
Organized liquidation is another niche area that continues to rise in India.
Personal attention at high-end stores or personalizing your high-value purchases such as bespoke clothing, cars and jewellery is a traditional phenomenon. However, technology is now ensuring mass-personalization across a wide range of goods and services. While e-commerce is bringing innovations in recommendation engines, retail stores are arming virtual shop assistants with customer's choices and preferences based on their past purchases. According to McKinsey, these initiatives have the potential to reduce marketing costs by around 20 percent.
To summarise, 2021 is expected to be an exciting and interesting year for retail and e-commerce industry. Omnichannel shopping, voice commerce, AR and AI will likely be prevalent. Therefore, retailers must be prepared to adopt the latest trends as soon as possible.