Retailer Adoption and Investment in Ai, AR and VR
Around 2 am we decided to take a @twitter break. Always my favorite #retailtech escape into exploring what my friends and fellow retail junkies are talking about. I have just come across a tweet from @avangroenendael a RT @MikeQuindazzi, giving credit where credit is earned. "In the US, retailers are increasingly investing in #AI, #AR and #VR #retail #retailers" end tweet. I was forced to stop.
We (LUXLOCK team) believe in AI, Assistants, chat applications and overall better service when shopping. However, this is also our space and we've tried them *all and they failed our definition of MVP or gold standard the retail industry should be accepting as an adequate solution. So, we turned to Webster to remind ourselves the definition of retail. Let's do an exercise-
1) the sale of goods to the public in relatively small quantities for use or consumption rather than for resale.
2) being sold by retail
3) recount or relate details of (a story or event) to others
AI/Assistants/Chatbots: They are not integrated with the shopper or the product. We have yet to use one of these programs that actually sell the product or tell a story about the details that validate a perceived value. Customer Service is a different business process than retail. Customer service is the process of ensuring customer satisfaction with a product or service. This is more like conflict resolution or a post-retail activity. Retailers need to sell physical product to real people. Retailing is a dynamic and emotional experience, some higher than others granted but the goal is never to sell once to a single person. The objective is and will always be to develop a loyal customer that returns on their own. The selling process is not merely answering questions, it begins with asking open ended questions that allow a discovery process to introduce a product to a shopper and for the retailer to understand the shoppers needs, wants and expectations. If you don't know "who" you are selling to, how can you ensure you make a meaningful impact?
Returns are at an all-time high and costing manufacturers and retailers a serious amount of cash in either discounted merchandise, diluted brand value, or margin agreements that effect the overall profitability. Our math is not adding up. Granted these messaging programs are driving sales and proven to increase ecommerce conversion rates but we are convinced there is a missing piece. So, a question to everyone in the retail business. Is this the end of selling product? More money is being budgeted toward advertising than sales enablement and customer retention combined. I am no expert in advertising, but as a seasoned sales person with a track record of high full-price sell thru and comp. growth, it seems counter productive to get more customers before you take care of the ones you have. Most retailers and brands have been in business over 15 years, we should have a good handle on treating our current customers beautifully and have a steady repeat business. Please comment, we'd love to open up this as a discussion and explore different perspectives.
Augmented Reality: Brilliant and we see a very bright future in the retail and shopping experience application. It is already performing well int he beauty and jewelry product categories. I am excited to see it used more.
Virtual Reality: This is an other discussion but we'll touch on it. As a shopper, I am not interested in 50 different experience expectations as I shop for a dress across 10 websites. This is not going to save time or improve my overall shopping experience. However, I am not the target customers either. User adoption is going to be painfully slow to move beyond a fad. Also, we're missing the fundamental requirements to make this work great. Relationships and data able to render. It took me, 3 divisions and over 20 people at Ralph Lauren just to find and gain access to CAD files so I could upload them to a virtual showroom in 2011. Unfortunately, robust product data is not typically at anyones fingertips. Retailers don't get this information from the brands when they EDI over the product and PO data. Brands are not built for a dynamic direct to consumer business. The internal infrastructure is not a tech rich environment. However, if we can built a foundation that is designed with digital and the shopper as the base, we fully support the future of social reality and the retail application that can provide immense value. Are we the only ones that see a 26% spend and see wasted dollars and an onslaught of poor shopping experiences (experiments) in our near future?
We're not pessimists. On the contrary, we see the biggest opportunity in retail revenues to improve the global economy. The future of retail is exciting, just looking for more purpose to the process. The moment a shopper is romanced by a brand, and they feel the connection; is beautiful. Not very many people embark into retail to get rich. Although, some have achieved a Retail return but millions of worker bee's are making retail work through pure passion. The art of retail, can be a gorgeous experience.
We've brought up some solid points and opinioned commentary to this awesome infographic from BI Intelligence. Join the conversation... what are your thoughts?