The Ever-Changing Retail Environment

The Ever-Changing Retail Environment

By Vlad Yakubson, Head of Retail, Retail Apparel Group

Vlad Yakubson, Head of Retail, Retail Apparel Group

If I was to start by saying that Google only went live in 1998, YouTube in 2005 and Instagram in 2010 most Gen Z and Millennials probably would not believe me.

A lot has changed in the digital world over the last 10 years and the speed of change is continuing to increase at alarming speeds.

There have been many writers and experts across multiple industries point to the fact analytics and AI will be key to success in the current and near future. That being said, my contention is that they are probably right. With one major condition.

Without an emotional connection, all this upcoming technology will not be the definitive trigger to future generations and their purchasing habits. It is without doubt that people want convenience, speed and easily accessed products as a basic standard of purchase. At times, this may help brands find their competitive advantage over price and promotion.

The key to all the analytics, AI and future technology is the “how” to apply them in a personal way to relate best to the consumer.

People react to emotion and a connection as much as they do to what they so call is reasonable and right. If you were to ask yourself how many times you have decided based on “gut” feeling or because you were in the moment and felt good about it whilst later trying to find a way to justify the decision to yourself.

People and customer connection will continue to thrive in the new eco-system and what experts are calling the “phygital” world. Australian e-commerce statistics are reporting that almost 80% of the Australian population are shopping on-line and soon 1 out of every 10 items will be purchased off e-commerce stores. Sounds like a pretty big deal, right?

What if we flip the way we look at things and say that almost 90% of Australian purchases are still taking place with face to face interaction in bricks and mortar stores!

The fact is that advances in customisation, Click and Collect, AI, cashless check-outs and any other future technology will continue to grow at exponential rates and brands must adapt to survive. The environment will force technology as a base standard across most industries. However, it won’t replace the human interaction and the emotional connection that people can offer.

I’m not oblivious enough to say that technology has already replaced some workplaces and some roles within specific industries. This is more of a statement on today’s economy and the marketplace itself. Simply said, unproductive and non-competitive brands simply cannot survive.

As can be seen, by so many physical store closures around the world, technology has accelerated the exit for saturated markets.

For future retail brands to survive, they need to adapt and relate to their customer preferences.

Technology must be an aid and enhancement to the current connection that people have with your customers. Sticking with the formula of keeping things simple, people buy from people and people are at the absolute core of every business.

Everything we do is about an emotional connection.

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