Trends That Changed Retail In 2016

Posted by Jenni Saunders on

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The world of retail continued to be transformed by technology in 2016, with convenience, personalisation and a unique experience among the top items inspired by innovation.

While the US and Europe lead the way in technology adoption, Australia followed closely behind, enjoying the rollout of easier payment processing, tag technology and proximity marketing this year.

So as we look back on the new trends retail delivered in 2016, here are the top five innovations being readily embraced by an ever-evolving retail industry keen to compete at a new level.

Payments

Australia ranks as one of the fastest adopters of contactless payment processing technology and that trend was well and truly catered for in 2016. Square announced its new chip card reader that also handles contactless payments using bank apps, while PayPal continued the rollout of its chip and pin technology.

They weren't alone in their new payment push with a variety of bank and digital wallet apps catering to the convenience of contactless payments.

Next year this will include the Australian rollout of MasterCard Selfie, which allows users to authenticate payments via a selfie picture or fingerprint rather than pin.

Point of sale

New methods of payment called for further refinement of the retail checkout with mobile POS increasing its market share.

Led by innovators like Revel, Vend, ShopKeep and Square, mobile POS enables retailers to ditch lengthy software contracts and instead have their point of sale system up and running with the download of a simple app.

Usually supported by desktop features for greater reporting and more detailed inventory management, these apps are accompanied by compatible POS stands and hardware and make setting up a POS system as simple as having a few tablets in store.

Due to their portability, they offer convenience for pop-up, small and big retailers alike, allowing faster checkout and acting like a virtual sales assistant. 

Proximity marketing

Proximity marketing allows personalised smart phone messages to be sent to consumers inside a store via beacons, and has been making a major impression in the US and Europe in the past few years.

In 2015 Business Insider estimated beacons would directly influence some $40 billion in US retail sales in 2016, a 10-fold increase on the year prior.

And according to Tech Crunch, in 2016 "close to 500 proximity companies operate globally, and between 6 and 7 million beacons are deployed in commercial settings with the latest forecasts pointing to a total of 500 million beacons by the end of 2020".

In Australia, Buzinga notes retail markets have been leading the nation’s beacon adoption over the last three years.

"Especially for luxury brands, where the standard for customer service is generally much higher, beacons are a distinct competitive advantage.

"Audemars Piguet is a luxury watch retailer with stores in Sydney. They recognised the need for their employees to be well informed about product details.

"When a customer picks up one of its watches, it automatically opens a screen on a nearby smart device with information about that watch — prices, technical specifications, other colours and bands not being displayed, and so on. This gives sales assistants useful, real time data that increases the likelihood of making a sale."

High tech tags

Also adding to this font of information is new age Radio Frequency Identification (RFID) tags.  Promising to increase sales by between 2% and 7% according to Igeolise, RFID uses electromagnetic fields to automatically track products and stash information.

Not only do RFID tags provide up-to-the second information about inventory, including where stock is and how much is left, they can also hold valuable data and enable automatic re-ordering, making this a boon for security, customer relations and inventory management alike.

An IDTechEx report found that in 2015, the total RFID market was worth $10.1 billion, but was expected to rise to $13.2 billion in 2020.  

"In retail, RFID continues to be adopted for apparel tagging - that application alone will demand 4.6 billion RFID labels in 2016 - which still has some way to go with RFID penetrating about 15% of the total addressable market for apparel in 2016."

Smart change rooms

So where does all this information go? Well it meets in places like the smart change room and via virtual reality where customers can test out items without trying them on or, in some cases, without even visiting the store.

cio.com highlights the use of magic or memory mirrors by UGG Australia, where shoppers can test alternate colours, sizes and lighting to see how a product could look, while Bloomingdales now has iPads in fitting rooms so consumers can request help, read reviews of products or see what sizes a store has in stock.

Meanwhile businesses like furniture retailers or service companies are employing virtual reality to provide an immersive experience for shoppers keen to know what the result of their possible purchase could be.

The final word

The world of retail is changing rapidly and technology now plays a fundamental role in creating an experience rather than just offering products.

For retailers using it, these new trends and innovations are only limited by the imagination.

 

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