The Future of Retail. Where are the shoppers going?
The Wrap Jul 22, 2022 — Edition 23, Volume 2
Lead Editor and Writer: Chuck Metz Jr with sous chef and tapestry weaver Rob Tyrie along with submissions, positive vibes, and deep empathy from the systems thinkers, writers, futurists analysts and cheerleaders of the Grey Swan Guild, a virtual think tank that does stuff like ponder about the future, the ethics and the human implications of the universe and metaverse, among other stuff.
Join us on Clubhouse this Sunday the 24th July 2022 at 8 am PST | 11 am EST | 4 pm BST | 5 pm SAST to make sense of it all, have your say, and engage with your favourite Grey Swan Guild Wrap Editors
With Prospect Theory, the work for which Kahneman won the Nobel Prize, he proposed a change to the way we think about decisions when facing risk, especially financial. Alongside Tversky, they found that people aren’t first and foremost foresighted utility maximizers but react to changes in terms of gains and losses. “Gains and losses are short-term,” he says. “They’re immediate, emotional reactions. This makes an enormous difference to the quality of decisions.”
He argues that when people think of the future, they think of the near future far more than the distant future. Changing the perspective from people looking to obtain long-term wealth, to people not wanting to lose tomorrow, significantly alters our understanding of behavior. “People put much more weight on losses than gains. People hate losing.” — UBS Nobel Insight
From Hunter-Gatherer to being Gathered: Futures in the Retail Industry
The compass has moved. No new north for now. Just a circling needle mirroring the restless circling in our minds and steps…
At least that’s how we might write an opening to a novel peering into insubstantial futures. But peering isn’t enough. Willingly or not, we must buy into the future. And what hits closer to home than retail and our restless quest for life’s needs… and wants?
Not easy like when we were hunter-gatherers. Savannah. Forest. Protective Valleys. Flowing rivers. Fecund deltas. Surrounding seas. We knew where to go to find what we needed. We read the clues. Followed faint trails. Tracked and captured the quarry and picked at the seeds and fruits. Until that wiring became a fundamental part of who we were.
Agriculture complicated that ancient accommodation. Less moving about. We came to follow the seasons, instead. Tracked the sun. Watched for rain. And as our settled numbers grew and production swelled to surplus, we increasingly traded goods instead. Dickered and higgled or for what we needed. Progressively more social. And communicative. Face-to-face. Reading emotions. Intents. Learning trust. Building a bulwark of bonds. Punishing betrayal.
Exploding technology development has further complicated that ancient accommodation with its nuanced layer of social interaction skills. Marketing efforts track us. Peer at our emotions. Gauge our intents. Social media platforms persuade. Reward. Punish. Influencers…influence. And our dickering for our needs and wants increasingly takes place in a less physical world in our minds alone…
So, peering into the future, what might we say about retail? And about our current mobile foraging of digital landscapes to obtain what we need?
Digital Savannahs and Villages
What will replace brick-and-mortar? The importance of the so-called “in-store experience?” Brick-and-mortar stores are a much more congruent environment to savannah foraging and village living than their digital counterparts. Physical. Searchable. Evaluable. Touch, feel, taste, smell, listen. Comprehendible and controllable. “From a technology perspective, traditional retailers are stuck 30–40 years in the past.” Layered with being under- or over-staffed 86% of the time. Shopping, Big Data, and You: A Look Inside the Changing World of Retail (workato.com)
To our befuddlement, quarry has turned predator on our hunter-gatherer wiring. Pick me. Targeted marketing. Invasive profiling. Cookies. Data mining. Because we once became farmers, and villagers, social skills honed over millennia now sit atop our more ancient wiring. Barter and trade, but we hardly know what to trust anymore. The physical criteria by which we evaluate no longer apply. But for sight, and to a lesser extent, hearing — the five senses that have held us in such good stead are much less engaged. Making it more difficult to evaluate. Has this been the impetus of the brand economy where 4 out of 5 Americans are influenced by the label of goods? Interestingly less than 60% of Chinese shoppers are influenced by labels (although brands are catching, China is predicted to be the top luxury goods market in the world by 2025).
The increasing move to online shopping is but a first, baby step. What do digital stores even look like? Web pages? Mobile Phone and Tablet Screens? QR Code Lists? Digital catalogs and showrooms? Blended Hybrids like Amazon Go and Shoppers Drug Marts? Metaverse equivalents with avatar hunter-gatherers ranging Web3 landscapes? Or perhaps settled digital DAO communities trading via cryptocurrencies for physical goods and multiverse NFTs? What to buy or sell and NFT representing digital right now? Try OpenSea or ArtGate VR. The metaverse for retail is emerging fast.
Hunter-gatherers-to-omnipresent label hunters by which we’re pulled, pushed, and occasionally used — consumers. Defined by our quarry and institutions rather than by ourselves. Pushed to become need-and-want vortices demanding endless filling. Maelstroms consuming within the constraints of a linear economy that defies the circular rhythms by which we evolved and learned. A little harsh, but a little true.
So growth in targeted advertising will exponentially expand. Not least because finite resources will demand infinite creativity. And as the seemingly infinite New World once beckoned with ever bigger pies to split and apportion, so the emerging digital universe promises the same. And our hunter-gatherer instincts and social learnings will pursue those slices.
If you haven't taken a look at Shopping.Google.com in a while, you should… It’s not really a online e-commerce store like Amazon.com or Walmart.ca… it is a shopping channel generated by all the things that Google knows about you that you have turned on. So, search history, mail, location, etc. Dedicated Google users will be surprised… for Apple users… simply you're in the past — there is nothing like this in Apple Universe (though given the margin on the Apple App Store, it is understandable that Apple does not care).
The store is uniquely you, for better or worse.
From the disclosure statement.
Unless otherwise indicated, items on Google Shopping are ranked based on relevance, including your search terms and other Google activity. Some ads data is used to improve the quality of results.
(Learn more about managing how your experience is personalized.)
Items you can buy on Google are indicated by the cart icon. Google receives a commission for the purchase of these items, but this has no impact on how Buy on Google results are ranked.
The “Sponsored” label, however, means that advertiser bids may also influence how items are ranked and grouped. To opt out of personalized ads or block specific advertisers, visit Google’s Ads Settings.
The dark side? Ads that haunt our steps from site to site, ‘verse to ‘verse, changing whenever we select items. A future — tailored ever more precisely. Ever more enticingly. Advertising that increasingly manipulates as human behaviors are progressively parsed and understood. And more challenging, behaviors triggered regardless of our wills. With loss of privacy. And autonomy. A Pavlovian choreography in which we beg, dance and drool to a digital siren tune. We can see this in the transition of the #BookTok hashtag to new lists of books on Kindle to new Tables at bricks-and-mortar book stores piled with YA fiction from the back lists.
But hey, there’s always Positives
Always, yes. How we structure our forays — and our evolving retail environments — will determine how securing our needs play out.
Knowledge — always a good thing. In this evolving retail landscape, we can know as much as those trying to sell to us. Digital sites and tools exist, and they can be expanded and deepened. Technology can help us know. Free us as well as bind us.
Social — We are social for a reason. It’s a beneficial evolutionary survival trait. Influencers and opinions have assumed a much larger place in the evolving digital retail space than they ever had as movie-star spokespeople hawking branded goods. We can expect a growth in the number and infrastructure surrounding opinion-shapers. And with the toxicity of factional “fake news” and Web2 misinformation venues, we can expect our social evolution to catch up to our current social media cribs.
Evaluable — we can expect increasing development of technologies that allow our evolutionary and social wiring to interact with retail goods and services in ways to which we emotionally and kinetically relate. Historically relate. Because cognition has never been enough. And the limitations of current tech has forced the cognitive card. But that will change dramatically.
I came; I saw; I sang
Our technological acumen has the ability to create environments in which we can meet our needs more easily and efficiently than at any time in our hunter-gatherer, farming pasts. But our very humanity that is a result of those wirings can only flourish within increasingly and exponentially evolving technologies if those technologies are built to encourage human flourishing. The retail industry is one of those key areas.
We came from forest and savannah. We saw through village and city lenses. We now sing a digital song of promise.
The future retail stanza has choruses yet to sing….
Let’s take a tour now through retail's good, bad and ugly in 2022 and how it shapes our lives. BTW, if you want a quick retail hit for the eclectic modern geeks out there, try the fantabulous online-only store from BoingBoing.com, for the nerd(s) that has everything. You need that pop-up car cabin stat.
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The Lexicon — “Overstored”
The issue was raised by Horan Capital analyst David Templeton in his Monday (Feb. 24 2020) report on the Pier 1 bankruptcy and retail bankruptcies in general. “Non-store retailers like Amazon … certainly play a large part in the struggles facing brick and mortar retail stores,” he wrote. “However, an issue that looms just as large is the fact the U.S. simply has too much brick and mortar retail store space if a comparison to other areas of the world are any guide.”
That comparison shows that the U.S. has 23.5 square feet of retail space for every consumer. It blisters every other country on the globe, with Canada coming in second at 18.8 square feet. Even highly developed economies like the U.K. (4.6 square feet) and Germany (2.3) don’t come anywhere near the U.S. store count, even after the retail bankruptcies of the past year. It’s only natural that the most vulnerable companies are getting hit first. Source PYMTS.COM — 2020
Antonymic — See “Food Desert”
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THE NEAR TERM TRENDS
From Morning Brew:
- Selling online is nonnegotiable.
- Omnichannel tools create more meaningful shopping experiences.
- Automated technology helps retailers manage the labor shortage.
- Same-day delivery gives retailers a clear advantage.
- Social commerce is one of the biggest digital trends in the retail industry.
- Interactive retail experiences bridge the gap between the online and offline parts of a store.
- The borders between retail and other industries continue to blur.
- Community investments from retailers may be here to stay.
From Business News Daily:
- Putting ecommerce at the heart of business strategy
- Automation technology — pricing and inventory management systems
- Social media trends - social commerce and variety show content
- Personal shopping services
- Influencers will remain relevant — authenticity and micro-influencers
- Brick-and-mortar restructuring — flagship stores remain
- Smaller-format, specialty locations anchored around a specific purpose or localized effort.
- Collaborative marketplaces — partnering with department stores will also continue to be reimagined
- Emerging technologies to help them manage onsite staff.
- Consumers continue to favor buying items online and picking them up at the store, often curbside.
From Silicon Valley Bank:
- All in on omnichannel
- Personalization — partnerships, media and M&A to support
- Data gathering — beacons, mobile apps, self-service kiosks and virtual mirrors to build consumer profiles.
- Digitization — brick-and-mortar stores designed as showrooms that are directly connected to online platforms
- Channel optimization — optimizing media spend, reducing their dependency on Google and Facebook, as influencer networks
- Tapping the metaverse — Web3 and metaverse trends through partnerships and acquisitions.
- Advances in payment systems — enabled by fintech innovations, consumers and merchants will have access to an expanded array of payment options, from buy-now-pay-later to one-click or facial ID checkout
- Customer communication- more SMS, in-product and bot customer outreach.
- Changes to logistics.- vertically integrate into last-mile delivery and “near-housing” solutions/warehouse technology startups
We’d love to hear your thoughts about the future of retail what it means to you and what it means for the world economy and your next shopping trip. Join us on Clubhouse this Sunday the 24th July 2022 at 8 am PST | 11 am EST | 4 pm BST | 5 pm SAST to make sense of it all, have your say, and engage with your favourite Grey Swan Guild Wrap Editors: Our newest addition Chuck Metz Jr along with Doyle Buehler, Sylvia Gallusser, Sean Moffitt, Agustín Borrazás, Rob Tyrie, Louise Mowbray, Ben Thurman, Antonia Nicols , Esmee Wilcox, Geeta Dhir, Gina Clifford, Su McVey with Clubhouse Captains Howard Fields, Scott Phares, and Lindsay Fraser.
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