Future of Commerce Blog

Technology Trends that Are Changing Ecommerce and Retail


Technology is rapidly changing the way we live our lives, and that includes how we shop. 70 percent of consumers say that technology “has made it easier than ever” to seek other brands to do business with. That means it’s essential to stay ahead of the curve and differentiate your brand through technology.

Sometimes, tech is just a fad. Other times, it’s here to stay. These five technology trends have earned their permanent place in retail and ecommerce, and they’re bringing new opportunities for brands to deliver positive customer experiences.

Virtual and Augmented Reality

Virtual reality (VR) and augmented reality (AR) were once seemingly unattainable technologies to use. But now, the technology is becoming more accessible to retail brands of all sizes. Revenue from AR alone is expected to be $90 billion by 2020.

Plus, consumers are growing to expect it from brands. Almost 70% of shoppers predict retailers to introduce an AR app within the next six months, 61% prefer stores that offer AR experiences, and 40% would pay more for your product after experiencing it through AR.

The opportunity for brands here is huge: Nearly two-third of companies don’t use AR at all, which means this can be a major differentiator. For inspiration, check out how AR has been incorporated into the customer experience, while VR has enhanced the customer experience and provided new levels of data to retailers.

Brick-and-mortar and online-only retailers alike can benefit from these technologies. They can create a more “tactile” experience than your online store alone. Plus, small local retailers can reach a global audience more easily.

Artificial Intelligence

Artificial intelligence (AI) is another innovative technology that has become more accessible for retail and ecommerce brands. In fact, 86 percent of CMOs of retail companies plan to invest in AI this year, mostly with the goal to increase customer engagement.

In person, AI can enhance the brick-and-mortar shopping experience. Some uses have been dynamic in-store product displays that change based on biometrics and robots that interact with customers. Amazon Go’s “no checkout required” store is a prime example of AI technology in the retail environment. Rather than going through the traditional checkout experience, AI recognizes who the customers are and automatically charges their Amazon account.

Online, AI-powered chatbots serve as on-page conversion tools to help users through the buyer journey. It can also be incorporated into your customer relationship management (CRM) software — responding to customer feedback, learning shoppers’ preferences and deducing personalized recommendations based on past behavior.

Sephora took a different approach to engage online users: They introduced an AR app that uses AI technology to interact with users through Facebook Messenger. Users would upload a photo, and Sephora would respond with product recommendations. It synced with their inventory management software, so only products that were in-stock and available to purchase were recommended.

But the technology isn’t just consumer-facing. There are ways in which retailers can use AI to learn about your customers. The technology provides access to layers upon layers of data about individual customers, and it can also interpret that data to provide specific insights.

One other use is protection from fraud. Almost 70 percent of respondents to an Aite study said that machine-learning analytics is very high on the priorities list of fraud mitigation investments.

Warehouse Robots

Bloomberg reports that Amazon has somewhere around 30,000 robots around the world. And they do 70 percent of the work in Alibaba’s smart warehouse. Warehouse robots are a technology that can reduce labor cost and human error in operations.

Optimize your warehouse management >

Warehouse robots technology may seem intimidating, but more brands are adopting them than you might initially think. Between 1993 and 2007, robots made up 16 percent of labor productivity, and it’s expected to be worth $4.4 billion by 2022.

If you want to explore the possibility of introducing warehouse robots into your operations, the following companies are a good place to start:

Immersive Concept Stores

72 percent of global consumers say that experience is important when visiting a brick-and-mortar store. You might’ve heard about Target’s experiments with smaller store formats, and Sephora’s Beauty TIP Workshop experiential stores. Those are just a few of the brands that are dipping their toes into immersive concept stores.

These brands are luring customers into their physical stores to enjoy an immersive brand experience — and also trying to change the minds of the 77 percent of consumers who avoid stores.

Craft an immersive, tech-forward experience in your locations that will drive foot traffic, awareness and sales. Keep the experience true to your brand and be attuned to your audience’s preferences.

Changing Consumer Behavior

Technology is changing the way consumers shop. As of 2017, consumers have an average of nine channels to choose from and nearly three-quarters use multiple channels. Interweaving omnichannel interactions have replaced the formerly linear path to purchase.

Read about the difference between omnichannel and multi-channel retail >

Brands are increasingly challenged with consumers’ challenges to create a synonymous and positive experience across all online and offline channels. This means understanding and anticipating where and how your customer interacts with your brand.

Consider shopper preferences to start: 30 percent are opting for buy-online-pick-up-in-store (BOPIS), which demands efficient and connected fulfillment workflows. And mobile devices are in the hands of 90 percent of in-store shoppers.

American Apparel’s answer to mobile behavior: Introduce in-store beacons to enhance the customer experience and encourage in-store engagement. Meanwhile, Whole Foods is using InstaCart to cater to mobile shoppers and deliver groceries to customers’ homes.

With rapidly changing consumer behavior, new technologies and other factors at play, it’s important to think ahead.

Learn how you can prepare for the future of retail >

Ellie Kulick

Ellie is an experienced Marketing Communications and Content Specialist based out of San Francisco, CA. Passionate about technology and health, she is constantly looking for new challenges in effective communication and creative content development to help businesses grow and engage with current and prospective customers.

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