Retail Metamorphosis Featured Signal of Change: SoC1187 October 2020
September 2020's SoC1181 — Retail Interruption looks at the downfall of traditional brick-and-mortar retail and the various ripple effects that large retail chains' going out of business creates. Retail interruption is perhaps the most visible change that is affecting the retail industry, but retail metamorphosis promises to usher the industry into a new age of interacting with consumers and markets. Intriguingly, some interaction exists between changes in urban environments—which SoC1169 — Urban Features for Future Pandemics outlines—and the retail landscape. Architects, city planners, and futurists have begun to opine about the changes that cities will experience because of the coronavirus-disease-2019 (covid-19) pandemic. Such changes will affect and be affected by novel types of retail outlets, new interior designs, and employed technologies.
Many of the technologies that see use in the online world could seep into brick-and-mortar environments to increase shoppers' convenience and improve their experience.
In a June 2020 CityLab (Bloomberg; New York, New York) article, a team of journalists identifies several areas of urban life that will likely see change as a result of the covid-19 pandemic and its implications moving forward. Unsurprisingly, the team touches on many factors that will affect retail infrastructures and related operations either directly or indirectly. The team discusses not only store-design changes such the establishment of one-way aisles and the implementation of various ways to separate cashiers and customers but also the surge in online shopping—changes that shoppers have already noticed. As a result of these changes, the purpose of many shops' real estate will begin shifting, with store real estate's playing an increasingly prominent role as warehouses and distribution centers. Some retailers have already taken this development into consideration. October 2017's SoC969 — Reconsidering Brick-and-Mortar Stores lists several advantages that physical stores can offer even in the era of e-commerce. For example, Target Corporation's (Minneapolis, Minnesota) plan to leverage its national footprint of stores as a network of distribution centers enables the company to fulfill online orders in hours rather than days. The longer the pandemic continues, the likelier it becomes that temporary changes will transition into permanent features of urban life. In time, many temporary changes could become long-term, habitual changes that affect consumer behavior, retail, city design, transportation, work environments, and pastime activities; retail is at the center of many of these areas of potential change.
Retail environments are employing various methods to minimize the spread of covid-19 among customers. The CityLab article mentions how many stores have installed transparent plastic partitions that separate cashiers from customers. But efforts to prevent the spread of covid-19 must go beyond this type of quick fix. For example, many interactions within stores—most prominently, interactions with payment-module keypads—require touch, which many consumers currently have concerns about. In fact, according to the results of a survey by interface company Ultraleap (Bristol, England), 79% of US respondents and 85% of UK respondents believe that touchless interfaces, in comparison with touch screens, "would be more hygienic and give them better protection" ("The End of the Touchscreen Era," Ultraleap, 27 May 2020; online). But Ultraleap sells touchless interfaces, so observers should take the results of its survey with a grain of salt. Nevertheless, many consumers probably do actually prefer to avoid touching interfaces, and new touchless solutions will play an increasingly important role in retail environments.
Some speculative concepts could fit into a future in which ongoing robotization pairs with a desire to avoid all human contact that is unessential to human friendships and socialization. For instance, FamilyMart Co. has begun a trial of using remote-control robots from Telexistence (both Tokyo, Japan) to stock shelves in its convenience stores. The goal is to deploy these robots, which humans operate via virtual-reality terminals, to some 20 convenience stores by 2022, with additional deployments thereafter if the tests are successful. Retail environments might seem like an odd location for remote-control robots, but as retail outlets' distribution-center operations merge, seeing how such technologies will move from warehouses to store branches is easy.
Meanwhile, seeing the need to adjust to surges in online shopping and its customers' need for rapid delivery, Target appears to be moving ahead with leveraging its network of stores as distribution centers. At the end of 2017, Target acquired Shipt—a delivery service with vetted shoppers that is now operating in more than 250 cities. And in May 2020, Target mentioned plans to purchase some technology assets from same-day-delivery-service provider Deliv (Menlo Park, California). Target claims it has no plans to integrate any of Deliv's technologies into its operations in the near term but will conduct research and perform tests to determine how the tech could benefit its supply chain at scale.
Other companies are looking for new ways to make online purchases even faster and more convenient and serviceable. For example, IKEA (Delft, Netherlands) has found a novel way to leverage an architectural quirk to give online customers easy access to a type of personalization. More than half the people in Russia live in Soviet-era apartment blocks, which offer a very limited number of apartment designs and floor plans. On its Russian website, IKEA replicated these floor plans and gave them virtual makeovers, making ordering the items the website suggests for redoing the interior design of each floor plan very easy for customers. The company may expand this service to other regions that have substantial Communist-era housing. More generally applicable, Google (Alphabet; Mountain View, California) is working on a new approach to making payments in online and virtual environments. The company is running a pilot program for its Voice Match voice-confirmation feature, which will enable secure voice purchases through the Google Assistant virtual assistant. This new feature will reduce friction in transactions by eliminating the need for users to verify voice purchases on their smartphone (via fingerprint or facial recognition). Google is clearly looking at facilitating the shopping process, which will make impulse shopping increasingly common in home environments. Voice Match can enable very fluid marketing, decision-making, and purchasing environments in which consumers can see a product on television and trigger the product's delivery by speaking just a word or two. Physical-store operators should pay close attention to technologies that provide strong benefits for brand owners and online retailers. Conceivably, many of the technologies that see use in the online world could seep into brick-and-mortar environments to increase shoppers' convenience and improve their experience.