SXSWi: The Future of Retail
The shopper experience is not one of 'digital' or 'physical.' It's inherently both. But figuring out the intersection is the challenge.
Provocative debate, surprising hypotheses, and complex predictions are the hallmarks of SXSWi. On Day 2, the $5 Trillion Question: What’s the Future of Retail? panel proved to be one of the more impressive and animated sessions I have attended for some time. The panel tackled the challenges facing retail, and it was agreed that while established retailers need to break from their legacy practices and radically alter their culture and values every few years in order to succeed, the task of younger retailers is to scale quickly by closely watching and responding to changing consumer behavior.
Controversially, Michael Schrage from the MIT Center of Digital Business proposed that “retail” itself is the wrong organizing principle, and that we should instead talk about the future of Shopping. Change the word “retail” to “shopping,” and suddenly you shift your focus to consumer behavior and insights, and your metrics of success become much more closely aligned with human action, rather than less-than-useful stats such as footfall and traffic per square foot.
The future of shopping is deemed to be one of integration: it’s not either/or when it comes to whether it should be digital or physical.
Moreover, products must deliver some sense of ceremony beyond pure function, and even the shopping experience must deliver utility rather than being merely a concept space. That blending of qualities is key in e-commerce: brands need to make room for the convergence of both content and commerce on their platforms if they are to appeal to the increasingly demanding consumer.
The Future Will Be Personalized took a look at how innovation in three production techniques – 3-D printing, milling, and automated knitting – resulted in a complete change in the perception of what a running shoe could and should be, as well as a revolution in the speed and location of the manufacturing process itself. What underpins all of this is the culture and behavior of an organization. These are critical if you’re to truly deliver upon and sustain a program of upstream innovation.
How VR Will Change Fashion made us want to become film directors and fashion designers. VR (virtual reality) is heralded as the next big shift in platform, and brands that want to innovate must dip their toes in the VR waters this year. As Anarghya Vardhana from Maveron, a venture capital firm, said: “It’s going to be a while before we get to mass consumer adoption, where consumers have a daily VR experience… Expect it by 2017.” To hear that 12 months is now deemed “a while” by VR experts is a sobering reminder that time waits for no one and that we need to move fast.
So what should we be doing in 2016? Well, that depends on your brand, but if you think of 2016 as a pilot program year that allows you to experiment, you might decide to test out a quick 360, behind-the-scenes video to get a pop of PR; or you could go all-in with a high-production film where models at a fashion show are filmed in VR, interacting with you and the individual pieces in the collection backstage. Or maybe you can think about the role of VR in e-commerce, when you’re at a concert and your favorite artist is onstage wearing a fabulous hat – can you give the fans the opportunity to buy it right there and then? This is the year to have fun with VR, to make mistakes, to learn from them, and to prepare for whenever it really does hit the masses.
Finally, AI and Your Shopping Habits reminded us that the era of the human editor and curator will inevitably make way for machine learning solutions. And that we should embrace it, because machine learning has become so sophisticated at categorizing patterns and clustering identities that the useful interpretation and application of all that data is truly starting to feel very human and natural. The Holy Grail of AI (artificial intelligence) is neither its brilliant recommendations or anticipation of needs; rather, it is both – and it is also more. The Holy Grail is when the experience is elegant and magical, and when I am pleasantly surprised and inspired by the suggestions that are made around the clothes, food, music, and travel destinations I might like. But even then, there remains a difference between (superior AI) curation and actual invention, for invention is where the human element will continue to reign.
So here are the three lessons from Day 2 of SXSWi:
- One year is a long time in today’s world. Don’t let anyone tell you differently. If you’re going to stay ahead of the pack, you need to move fast and to keep moving.
- Don’t forget the human element in the pursuit for technological excellence. The thoughtful craft that we bring to visual storytelling and curation remains of high value.
- Change your perspective, and do this often. Demand a revolution in yourself and in your organization to ignite and propel a culture of progress.