Tuesday, June 22, 2021

5 Retail Innovation Trends That Reshaped 2019

Satta Sarmah-Hightower
November 27, 2019

4 minute read

Today, the customer experience isn’t bound to any one physical or digital space, as 73% of consumers use multiple channels to shop, according to a Harvard Business Review study of 46,000 shoppers.

Modern retailers understand this new omnichannel reality and are adopting retail innovation strategies to meet shoppers wherever they are — and on whatever device they choose. From transformations in customer service technology and grocery shopping, to social media shopping and changes in the delivery and brick-and-mortar experience, here’s a look at innovations reshaping retail in 2019 and beyond.

Revolutionizing the drive-thru experience

Fast-food restaurants may get even faster thanks to retail innovation in customer service tech.

McDonald’s, for example, recently announced its plans to acquire voice-recognition startup Apprente. According to the press release, Apprente was founded “to create voice-based platforms for complex, multilingual, multi-accent and multi-item conversational ordering.” The startup, which launched in 2017 “with a mission to build the world’s best voice-based conversational system that delivers a human-level customer service experience,” could streamline McDonald’s drive-thru experience.

The acquisition is part of the fast-food behemoth’s larger effort to transform its customer service. McDonald’s also has acquired or invested in companies such as Dynamic Yield, which customizes drive-thru menus based on factors like weather and time of day; and Plexure, a mobile engagement software company that, according to the press release, will provide McDonald’s with “access to greater back-end and front-end features, customer functionality and customer targeting, among others.”

McDonald’s appears to be laser-focused on its digital transformation, and considering the company’s global footprint, it’s likely paving the way for other quick-service restaurants to adopt similar innovations.

Transforming grocery shopping

Technology hasn’t just transformed customer service. It’s also changing the grocery store experience.

The startup Pensa has created an autonomous perception system that grocery retailers can use to track their inventory. The technology is powered by small drones that go down store aisles and scan each shelf to report out-of-stock items. Pensa also uses algorithms to learn how items should be arranged in-store to increase customer purchases. Pensa has done a test with a Canadian grocer and Anheuser-Busch, which also is an investor.

The shopping experience in grocery stores is changing, too. Both Whole Foods and Amazon have allowed customers to use voice assistants to order groceries, bringing AI into the brick-and-mortar experience and allowing customers to use their voices — rather than their hands — to shop. Walmart and Google also have partnered to bring voice shopping to the masses, enabling customers to simply say, “Hey Google, talk to Walmart,” using Google’s voice assistant to begin the process of adding items to their grocery lists.

Driving faster deliveries

Uber and UPS are now experimenting with drones to get customers their goods even faster.

Uber Eats, the company’s food delivery service, announced plans to test drone deliveries this summer in San Diego to speed up delivery times in congested cities. UPS has launched drones from the roof of its delivery trucks to set itself up to compete in the future with ecommerce giants like Amazon. In July, the company announced plans to expand its drone delivery operations, which currently only delivers medical samples to a North Carolina hospital group, according to CBS News.

The emergence of social shopping

Apparently, social media is no longer just for posting viral video outtakes or vacation photos that inspire FOMO.

As of 2018, according to Gartner, “66% of analyzed brands have adopted a social commerce feature within the past year.” And this year, the top 500 retailers will earn an estimated $11.9 billion from social shopping, according to a Business Insider Intelligence study.

Shoppable Instagram posts, in particular, are one retail innovation that could change ecommerce. Consumers already spend about one hour and 15 minutes a day on social networks, so it makes sense that retailers would bring the shopping experience to them on these platforms and allow them to make purchases in just a few clicks.

Going from digital native to brick-and-mortar

Digital native brands are moving from “clicks to bricks,” according to the real estate firm JLL, which estimates that ecommerce retailers will open 850 brick-and-mortar stores within the next 5 years.

Some retailers leading the way include mattress brand Casper, which is set to open 200 physical stores over three years; shoe company AllBirds, which now has stores in 8 cities, including Seattle, San Francisco, Boston, New York and Chicago; and Warby Parker, an eyewear brand that now has retail locations in more than 30 states.

Having that tactile experience — touching and seeing a product before you buy it — may help shoppers make a more informed purchasing decision. Nordstrom’s Co-President Erik Nordstrom also brings up another valid point about the benefit of the in-store experience.

“Today’s retail stores no longer exist just to display merchandise,” Nordstrom said. “They should be a place for engagement, faster returns, pickups and alterations,” Nordstrom said during his keynote at the 2019 Shoptalk conference.

As digital-native brands move from clicks to bricks, it demonstrates that brick-and-mortar can complement the digital customer experience and act as another touchpoint for engagement that drives brand loyalty and retention.

The future of retail

Retail innovations are changing how consumers connect with brands. Customer experience is now at the forefront of how companies set themselves apart in the marketplace. Whether it’s social shopping, voice-based commerce or drone deliveries, companies are using every technology tool at their disposal to differentiate their brand — and it’s transforming the retail experience as we know it.

To learn more about retail trends to look for in 2020, read “A Preview of Retail Innovation in 2020“.

Satta Sarmah-Hightower
Satta Sarmah Hightower is a freelance writer who covers topics such as healthcare tech, government IT, business and personal finance for a wide range of brands and publications. A former journalist, Satta previously worked for AOL and the Tribune Company. She has a bachelor's degree in journalism from Boston University and a master's degree in journalism from Northwestern University's Medill School.
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