Italiano
EnglishExponential technologies such as artificial intelligence, augmented reality, 3D printing and networks are radically reshaping traditional retail.
E-commerce giants such as Amazon, Walmart and Alibaba are digitalising the retail industry, driven by the exponential growth of computing power.
Many physical stores have already gone bankrupt or moved their operations online. Huge changes are taking place in this arena.
Offline retailers have seen a sharp fall in value, while the main player in online retail, Amazon, has grown astonishingly.
For the “real-life stores” that survive, an evolution is under way from a product-centred mindset to an experience-based business model that draws on AI, VR/AR and 3D printing.
E-commerce trends
Last year 3.8 billion people were connected online. By 2024, thanks to 5G and to stratospheric and space-based satellites, we will reach 8 billion people online, each with connection speeds from megabits to gigabits.
These 4.2 billion new digital consumers will start buying things online, a potential source of revenue for the e-commerce world. At the same time, entrepreneurs who want to serve these 4.2 billion new consumers can now skip the costly steps of buying retail space and hiring sales staff. Today, thanks to global connectivity, contract manufacturing and turnkey logistics, an entrepreneur can go from an idea to building and scaling a multi-million company from anywhere in the world in record time.
And while e-commerce sales are exploding (from $34 billion in Q1 2009 to $115 billion in Q3 2017), e-commerce accounted for only 10 percent of total sales in 2017.
Growth of e-commerce sales in the United States
In 2016 global online sales totalled $1.8 trillion. Remarkably, that $1.8 trillion was spent by only 1.5 billion people, just 20 percent of the world population that year.
There is much more room for digital.
Artificial intelligence and the retail experience
For the business owner. Artificial intelligence will demonetise e-commerce operations through automated customer service, supply chain modelling, and the generation of marketing content and advertising.
- Customer care: imagine an artificial intelligence trained to handle every interaction with customers, that learns to answer any consumer question perfectly and, as a result, gives automatic feedback to product designers and business owners.
Going a step further, imagine an AI that is empathetic to a consumer’s frustration, that can take any kind of abuse and come back with a smile every time. Take Ava as an example. “Ava is a virtual customer service agent, who brings a whole new level of personalisation and brand experience to that everyday customer experience,” says Greg Cross, CEO and creator of Ava.
- Optimised supply chain: predictive modelling and machine learning also optimise product ordering and the process that drives the supply chain. For example, Skubana, a platform for online sellers, uses data analysis to give entrepreneurs constant feedback on product performance and maintain optimal stock levels.
Blockchain is also part of the picture: ShipChain and Ambrosus aim to bring transparency and trust to shipping and production, further reducing costs for entrepreneurs and consumers.
For the consumer. Personal shopping assistants are shifting the psychology of the standard buying experience.
Alexa, Amazon’s voice assistant, marks an important moment for the user interface.
Alexa is at an early stage as far as voice search and voice controls for smart homes are concerned. Even so, Alexa users have on average spent more on Amazon.com than standard Amazon Prime customers: $1,700 against $1,400.
The future combination of virtual reality shopping with a personalised, AI-enabled fashion adviser will make searching for, selecting and ordering products quick and painless for consumers.
But let’s go one step further.
Imagine a future in which your personal AI shopper knows your wishes better than you do.
Possible? Of course. After all, our future AIs will follow us, watch us and observe our interactions: how long we look at objects, our facial expressions and much more.
In this future, shopping could be as easy as saying “Buy me a new outfit for Saturday night’s dinner” to an AI tool, followed by a moment of surprise and delight when the outfit that arrives is perfect.
In this future world of AI-based shopping, one of the most disruptive implications is that advertising will fall out of use.
In a world where an artificial intelligence tool is buying things for me and I am no longer in the decision loop, why would a big brand waste money on a Super Bowl ad? The dematerialisation, demonetisation and democratisation of personalised shopping has only just begun.
The in-store experience: experiential retail
In 2017 more than 6,700 physical stores closed their doors.
Even so, business is still booming. As shoppers look for the convenience and ease of online shopping, physical stores are tapping into the power of the experience economy.
Rather than focusing on the practicality of the products they buy, consumers look for the experience of going shopping, for emotions.
While AI dominates online purchases, artificial intelligence and data analysis tools are also giving power to the owners of “in-real-life” stores when it comes to optimising staff, marketing strategies, relationship management and inventory logistics.
One thing is certain: the buying experience as we know it is on the verge of a great transformation. The convergence of exponential technologies has already improved how and where we buy, how we use our time and how much we pay.
Twenty years ago Amazon showed us how the web could offer each of us the long tail of what is available, and since then the world of e-commerce has exploded. Yet we have not yet experienced the cost savings that will come from drone delivery, the Internet of Things, tokenised ecosystems, the impact of truly powerful artificial intelligence, or even the other major applications of 3D printing and AR/VR.