As Internet of Things technologies offer the promise of a more connected retail experience, how consumers and brands interface with one another will also change shopping.
According to a report by Euromonitor International, titled, “Commerce 2040: Revolutionary Tech Will Boost Consumer Engagement,” the relationship between brands and shoppers will move from being transactional to one that encompasses interactions before, during and after the purchase.
“Societal shifts are often driven by a handful of factors, such as new population patterns or evolving consumer values,” said Michelle Evans, global head of digital consumer research at Euromonitor and author of the report. “Technology, in particular, emerged as one of the key drivers in the last decade reshaping the world and will likely continue as one of the most important factors creating future upheavals. Fast forward 20 years and the world, and commerce conducted within it will be noticeably different than today.”
Evans said the home, “the hub for family life,” will be even more connected and automated while entertainment venues will be driven by the ubiquitous influence of social media. For physical retail stores, the landscape will be vastly different than how it looks today.
“Convenience stores will likely be the only outlets with inventory,” Evan stated in the report. “Former retail outlets will shift into micro experiential centres, helping consumers discover and test products for later drone delivery to the home or designated neighbourhood spots. The lines between real and virtual will increasingly blur as consumers routinely layer virtual over reality, gaining more information or engaging in gamification opportunities for rewards or fun.”
The report noted that consumer expectations are changing along with “new competitive realities,” which is impacting how and where shoppers shop. “Purchases in the past were transactional,” Evan said. “Now shopping is a journey about relationship building. The journey is no longer just about the end-point — the purchase. The ideal journey provides value before, during and after the purchase, converting a transaction into a relationship.”
Evans said for retailers and brands who can’t compete on price, focusing on the relationship can serve as an important point of differentiation. But it has to be done in the right way, she said adding that physical stores “remain a critical part of today’s shopping journey, both in terms of brand engagement or purchase execution and continue to play a role in 2040, though their functions will evolve.”