Retail: the 5 tech trends boosting ROI in 2023

A new year and with it a renewed anticipation and appetite for the latest innovations. Emerging post-pandemic and in a time of socioeconomic unrest, we rise to the challenges of a rapidly changing environment. The cost of living crisis continues to impact how and where we spend our money. Retail has arguably never been more challenging. And yet these challenges provide incredible scope to shake up the way we shop. Here, we explore the technology turning the world of retail on its head. This way for digital transformation.

1. Omnichannel and hybrid shopping

Blurring the lines between online and in-store experiences, increased efficiencies in customer experience and automation remain big news. Whether that’s immersive experiences for customers in-store, touchless and contactless shopping or visual/image-based search to locate an online item in-store, omnichannel customer journeys will become more cohesive over time. As customers look to shop seamlessly in-store, online, in-app and across social channels, hybrid shopping will become an expectation from shoppers (and not just from millennials and Gen Z-ers). Boomers and Gen X-ers who may have favoured a more traditional in-store shopping experience previously (seeking the tactile, ergonomic and sensory experience associated with buying items such as clothing or homewares) will also expect a level of personalisation that matches their buying history and brand loyalty.

2. Enhanced collect and return services

Convenience is the name of the game, as shoppers look to buy-online-pickup-in-store (BOPIS, aka Click & Collect) as well as buy-online-return-in-store (BORIS) seamlessly and without issue (no quibbles over lost returns slips, receipts or other paper records). Whilst there’s no denying the return rate for online purchases remains high, many retailers are expanding their offering to maximise the options available to shoppers to ensure that every order is as easy to pick up and return as possible; boosting brand loyalty and propelling shoppers through the purchase funnel swimmingly. Buy-online-pickup-at-curbside (BOPAC) facilities (such as InPost lockers and EVRI hubs) are rapidly gaining mass market appeal too, with the pressure on retailers to ensure a seamless continuation of service across each of the many touch points within a hybrid customer journey.

3. Sustainability and the circular economy

Aligning with conscious customer values, trends in sustainability and the circular economy will continue to grow along with pressure on businesses to meet consumer demand for a reduced carbon footprint. As shoppers look for obviously green practices (such as recycled and recyclable packaging, paperless orders and electric delivery vehicles) demand will increase for brands to go the extra mile in reducing their environmental impact. Consumers will look for B Corp certifications or similar, amongst other demonstrable efforts unique to each brand identity (such as H&M’s pioneering Green Machine, a proprietary technology designed to recycle clothing at scale), to ascertain if a brand’s core values align with their own.

Circularity, or the circular economy, will become less of a buzzword and more a way of life as shoppers look to minimise waste and learn ways to extend the life of their belongings across tech, furniture, clothing and homewares, amongst others. Higher value luxury goods will harness blockchain technology to provide a digital footprint, allowing owners to track and verify items and their history, stamping out fakes once and for all. Digital passports for luxury items will boost the resale market as proof of authenticity from bikes to Breitlings.

4. AR, VR and the metaverse

If 2021 was all about the Metaverse and 2022 honed in on Web 3.0, then 2023 is the year for both worlds to come together. As AR & VR technologies rapidly advance, the Metaverse will become an essential channel in engaging and retaining customers. Still not au fait? Tech research leader Gartner defines the metaverse as: “A collective virtual shared space, created by the convergence of virtually enhanced physical and digital reality.” Retailers committed to aligning their omnichannel strategies with their Web 3.0 and Metaverse efforts (i.e. the creation of virtual stores, augmented reality walk-throughs and try-ons, etc), will lead the charge into a new virtual world. This development looks set to reduce returns too. Studies have shown consumers who used AR to try products virtually were less likely to send purchases back, with a 22% lower return rate. AR product visualisation is by no means limited to fashion retail, either – developments in skin technology and furniture look set to revolutionise across beauty and homewares, too.

5. The next step for AI

AI continues to play a part across every customer interaction and interface, blurring the lines between in-store and online to provide a hyper-personal experience for every consumer. From automating customer service to optimising touchpoints across the funnel, AI will propel further data driven insights through machine learning as more and more retailers adopt this approach. The result? Every customer insight, marketing initiative and digital interaction will be better, faster and stronger leading to refined targeting, increased sales and stronger brand loyalty. Internal operations and processes, from sustainability to supply chain logistics, look set to benefit too. Retailers lacking this competitive edge will simply be left behind as shoppers look for perfect product recommendations and next level service tailored to their tastes.

Gartner: Emerging Technologies: The Future of the Metaverse
Bloomberg: How Augmented Reality Can Cut Down on Returns

Our Conclusion

A changing face of retail shows no sign of slowing 2023. Pivoting from pandemic to penny pinching as the cost of living crisis continues to hit, every click, tap and conversion counts. Harnessing and utilising the trends and technology available, retailers everywhere must meet the mindset and touchpoint of every consumer – both physical and virtual – to survive.

Resources:

Bay Retail
CEW UK
Computer Weekly
Forbes
Intelistyles
Mobidev
Salsify