Retailers Shift To Meet Supply Chain, Fulfillment, And Digital Experience Needs

Retailers’ operations are in upheaval. The coronavirus crisis has spurred store closures, shorter hours, and slower shipping speeds — but also, in some cases, hiring, bonuses, and pay raises. 

But in many ways, this monumental disruption is simply turbo charging the pace of digital transformation. Trends that may have been on retailers’ radar in the medium term are suddenly critical right now.

For instance, average daily downloads for the top online grocery apps are way up as new users try out delivery and other low-contact services. Beauty brands’ interest in virtual try-on tools like augmented reality has intensified as well. Retailers, meanwhile, have had the chance to take a closer look at any technology that will further automate their stores. 

What other innovations could become more relevant?

We’re tracking 3 big shifts:

With temporary store closures and social distancing measures, e-commerce is now a bigger part of many shoppers’ retail habits.

Online grocery will boost retailers’ interest in micro-fulfillment centers to make fulfilling orders more profitable. Autonomous delivery will look more attractive, though will still require a fair amount of investment to get up and running in the US. 

Experience-driven retailers will lean on low-investment online engagement like livestream shopping. Immersive product content and virtual stores will draw more attention, but will require more investment in an efficiency-focused world. (Clients can read about innovations elevating the e-commerce experience here.)

At the store, profits will be in sharp focus. Retailers will look for technology that automates the store, including AI for inventory management, robot associates, and cashierless checkout. (Clients can learn about what other in-store tech is gaining speed here.)

In the absence of in-person experiences, consumers are focusing on the essentials. These will range from pantry items to products that have become more necessary for home life, like tech for kids. 

Wellness will remain a priority, but consumers will focus more on necessities, such as skincare or grooming. At the same time, mindfulness supplements, cannabis-infused food, and aromatherapy may get more attention from anxious consumers. (Clients can read about more self-care trends to watch in 2020 here, and rising trends in CPG here.) 

With gyms closed, consumers are taking advantage of more at-home fitness tech to maintain physical fitness; sleep tech and other wearables could also see a boost. 

Gaming’s virtual worlds have attracted renewed attention as consumers look for new ways to engage with people from within their own homes. This could draw more attention to the potential for virtual goods, though they’re likely to remain limited to a narrow range of products.  

Communication will have to be even more precise to reach consumers who are farther away. 

Loyalty startups that make engagement more personalized will help brands and retailers remain connected. E-commerce’s importance means more sophisticated advertising tech will also be crucial.

Connected “products-as-a-service” will also help brands stay in touch with (and learn about) consumers at home. 

Virtual one-on-one consultations for categories like beauty will provide shopper engagement that is more personalized than AI-driven quizzes (and also has the potential to help keep people employed). 

We’re already seeing the expansion of digital connections beyond strictly consumer businesses — and from telehealth to remote working tools, virtual communication is likely to become more common across daily life.