Reading about the predicted retail apocalypse makes the industry outlook seem daunting. It is true that the retail industry remains volatile, as retailers are filing for bankruptcies at a staggering rate. However, in a recent retail report, Coresight Research predicts that this year will be the year of retail reinvention rather than the retail apocalypse predicted. This heralds some much needed positive news for wearied retailers.
In our efforts to both better understand and inform retailers, Prevedere has partnered with Coresight on its report, “10 Retail Trends for 2019,” which identifies how the retail sector and physical stores, in particular, can evolve to provide consumers with a better retail experience.
As consumer preferences change, they expect faster, smarter and simpler retail transactions. According to the report, retailers are rushing to meet changing expectations with improved shopping experiences in the form of new and engaging flagship stores, more online to offline ventures, and innovative technologies. Retailers will also need to make data-driven decisions on inventories and pricing to adapt to a changing marketplace.
Coresight expects 2019 will not be the year of a retail apocalypse or even decline. Instead, it will be a year of reinvention
All the trends that are highlighted in the report point to a global retail sector that is stronger and better equipped to serve consumers’ demands. These trends require retailers to adopt a holistic “smart retail” approach integrating AI automation, human intervention, and intelligent data sharing to provide personalized interactions across multiple channels. Brands will need to leverage customer datasets with AI to anticipate customer needs and predict what shoppers want, suggesting relevant products or add-on services.
Technology will play a significant role as retailers move to adapt to consumers’ desire for speed and convenience. To accurately predict what customers will want, predictive analytics will take center stage in retailers’ plans for 2019 and beyond.
Facing a Retail Apocalypse, Coresight Retail Report Identifies Opportunities for Retailers
AI As Retailers’ Go-To Technology
With all the innovation taking place, Coresight reports that AI will become retailers’ go-to technology, cementing its position as the leading technological enabler of the industry. Not only can AI improve customer interactions and data management, but it can also increase operational efficiency through inventory management and price optimization. The report identified four major areas of opportunity for retailers to use AI. These comprise Coresight’s CORE Framework for AI in Retail:
• Communication: Retailers will need to focus on elements such as personalization, chatbots, virtual assistants and voice shopping.
• Optimization of pricing: To be truly ready for what the future may bring, retailers need to be able to optimize pricing by considering factors like forecasting, competition, and dynamic pricing.
• Rationalization of inventory: Inventory is always a challenge for retailers. Their focus should be on demand forecasting, allocation, and audits.
• Experiential retail: If retailers want to stay relevant, they need to consider incorporating new ways to engage, discover, buy, and pay.
Some retailers are already ahead in incorporating AI into their operational decisions. According to Coresight, Amazon leads the pack with initiatives like its unstaffed Amazon Go stores which have “Just Walk Out Shopping” technology that has taken that convenience experience to the next level. Walmart is also using AI and machine learning algorithms to organize inventory data, price merchandise, and optimize routes for delivery. The brand is also developing a facial recognition algorithm which will assess how satisfied customers are through their facial expressions.
How Retailers Prepare for the Future and avoid the Retail Apocalypse
Retailers can better prepare for what is to come by including external indicators in their planning and forecasting process. Utilizing a solution like Prevedere’s ERIN predictive analytics cloud, companies can analyze data faster and with more accuracy. Using the power of AI, ERIN rapidly analyzes millions of global data series updated daily from hundreds of sources. Companies can easily discover the specific external leading indicators such as wages, employment, consumer sentiment, weather patterns, or search/social trends, that will impact their sales, costs, or profitability. With enough lead time and visibility into upcoming headwinds, retailers can work with agencies, manufacturers, finance, and distribution partners to turn a potential down season into a profitable one or capitalize on the growth opportunity
Prevedere is a proud sponsor of Coresight Research’s Retail Trends for 2019. Coresight expects 2019 will not be the year of a retail apocalypse or even decline. Instead, it will be a year of reinvention — for the retail sector as a whole and for physical stores in particular.
Take a look at some of Coresight’s top retail report trends for 2019:
• Cities will see more spectacular retail from a new generation of flagship stores.
• “Fast Retail” will be marked by shorter leases, more shared spaces and more short-term stores.
• Western retailers will borrow from “New Retail” with data-driven online-to-offline ventures.
• Technology will continue to strip friction from brick-and-mortar retail.
• Artificial Intelligence will become retailers’ go-to technology.
• Startup partnerships will fuel new product development, digital improvements and operational efficiencies.
Download this report to see the top 10 retail trends for 2019.