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PSFK's Future of Retail 2020 Report - Summary Presentation

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Researchers PSFK provides the most pioneering thought leadership when it comes to innovation in retail and along the customer experience journey. PSFK's Future of Retail 2020 report provides a strategic roadmap for brands and retailers to deliver hyper-personalized service that meets the unique needs of every shopper in a post-experiential era.

This deck provides an introduction to the themes in the report plus concepts for the future of customer experience.

Full report: http://www.psfk.com/reports
About PSFK: http://www.psfk.com/membership
Concepts: http://www.weareyourstudio.com

Published in: Retail
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PSFK's Future of Retail 2020 Report - Summary Presentation

  1. 1. FUTURE OF RETAIL 2020 Retail As Personal Utility Overview of the PSFK report with concepts by YourStudio
  2. 2. A RELENTLESS EXPLORATION
 OF THE POSSIBILITIES OF RETAIL Today
  3. 3. Nike has rolled out a multi-store offering across LA with localized product & services
  4. 4. Nordstrom has taken a similar approach in NYC, each store featuring a mix of specialized product & services
  5. 5. Amazon has leveraged a distributed department-store strategy across Seattle
  6. 6. CloudKitchens Ghost kitchen models have changed the way we think about inventory, production and delivery
  7. 7. Brands & retailers are now exploring sustainable options like TerraCycle’s Loop
  8. 8. We’ve been publishing The Future of Retail report for 10 years and each year the rules get rewritten
  9. 9. Shop-in-Shop …and still impact it today: 40 Disney in-store pop-ups in Target planned for 2020. Story experiences in 36 Macy’s locations. 11 Birchbox shop-in-shops, 500 pop ups for 2019 holiday season Sources: “Big News, Disney Fans: You Can Shop the Disney Store at Target Right Now.” Target, 2019, Macy’s, Birchbox To Pop Up In 500 Walgreens Stores For The Holidays. Retail Dive, 2019 What we saw impact retail over those 10 years…
  10. 10. Smartphone retail m-commerce sales will reach $203.94 billion in 2019, making up 34% of all US e-commerce sales. In 2021, 53.9% of all retail e-commerce is expected to be generated via m-commerce. Mobile Commerce Source: “Smartphones Will Account for More than One-Third of Ecommerce Sales in 2019.” eMarketer, 2019, Statista.com The 2010s in retail 2017 2018 0 40 60 20 %USEcommercesales
  11. 11. In 2017, 17% of North American retailers had adopted social commerce. In 2018, that number rose to 33% Social Media Source: Next-Gen Omnichannel Strategies Align Agility With Innovation. Retail TouchPoints, 2019 The 2010s in retail 2017 2018 0 25 50 (then Social Commerce)
  12. 12. Omnichannel Only four years ago less than half of retailers were pursuing an omnichannel approach. Today over 90% of retailers and brands have an omnichannel strategy or a plan to invest in one soon. Source: The State of Omnichannel Retail. Brightpearl, 2019 2015 2019 >50% 90% The 2010s in retail
  13. 13. 0 100 50 Connected Store A survey of retail professionals found that new technology (61%), connectivity (52%) and mobile technology (52%) were the top areas for in-store budget increases in 2018, compared to the previous year. Source: The State of Retail Tech. EMarketer, 2019 MobileTech Connectivity Technology The 2010s in retail
  14. 14. Experiential Marketers will spend 20.7% of their overall marketing budgets on event and experiential in 2018, which is up from 18.7% in 2017. Source: Experiential Intelligence Report: 2018 Experiential Marketing Spending Forecast. Event Marketer, 2018 2017 2018 0 15 20 5 10 25 The 2010s in retail
  15. 15. Estimates peg the number of D2C brands at more than 400 today, while online trends suggest web traffic has roughly doubled in the past two years. 40% of US internet users expect D2C brands to account for at least 40% of their purchases within the next five years. Direct-To-Consumer Source: Direct-To-Consumer Brands 2019. EMarketer, 2019 2019 2024 0 100 50 The 2010s in retail
  16. 16. Mobile A Decade of Change in Retail Shop In Shop Social Ominichannel Connected Store Experiential DTC 2010 2020
  17. 17. What Next? psfk.com/report/future-of-retail-2020 Our new report outlines the opportunities defining a new decade of retail
  18. 18. FROM HISTORICAL PROFILES
 TO REAL-TIME CONVERSATIONS Shifts we will witness in 2020
  19. 19. TARGETED ADS TO PERSONAL PORTALS Shifts in 2020
  20. 20. DATA PERSONALIZATION TO DATA PARTNERSHIPS Shifts in 2020
  21. 21. RESPONSIVE STOREFRONTS TO ANYWHERE STORES Shifts in 2020
  22. 22. RETAIL EXPERIENCES TO SHOPPER UTILITY Shifts in 2020
  23. 23. So… What’s Next?
  24. 24. THE FUTURE OF RETAIL = PERSONAL UTILITY
  25. 25. Advanced computing, delivery logistics & connected tech power a hyper-personalized retail experience with the objective of anticipating shopper need and providing exceptional service PERSONAL UTILITY 63% of consumers surveyed are interested in personalized recommendations, and the majority of them are willing to share their data in exchange for benefits. Source: Delivering For The New Consumer. RILA and Accenture, 2018
  26. 26. HOW DO WE DELIVER
 PERSONAL UTILITY?
  27. 27. <COMMERCIAL BREAK>
  28. 28. Includes 100 pages, 5 strategies, 20 Trends, 60 Best-In-Class Examples, Original Consumer Research in PDF + editable PPT The Future of Retail 2020 Report psfk.com/report/future-of-retail-2020
  29. 29. One of 250 reports in our growing library psfk.com/reports
  30. 30. Available to members of our 
 Business Intelligence service psfk.com/membership membership-sales@psfk.com
  31. 31. Inspires PSFK’s Future of Retail 2020 Conference Highlighting the need-to-know ideas and innovations driving successful commerce today. Featuring insights from experts both at emerging start-ups and leading corporations, this half-day program will explore how the best retailers and brands will play to, meet with, expect, serve and reward each of their customers in is the age of Personal Utility. Jan 15, 2020 NYC psfk.com/events
  32. 32. Informs New York Retail Innovation Week Partnering with brands like: Curated for change-makers who work in retail, at brands and their partner companies, these executives experience guided store tours, attend expert talks and conferences, visit demos, and conferences and connect at networking events. NYRIW is a calendar of independent and innovative events that run alongside the NRF 2020: Retail’s Big Show. www.riw.nyc Jan 12-18, 2020 NYC
  33. 33. </COMMERCIAL BREAK>
  34. 34. THE FUTURE OF RETAIL = PERSONAL UTILITY
  35. 35. HOW DO WE DELIVER
 PERSONAL UTILITY?
  36. 36. Delivering Personal Utility  INSPIRE ME MEET ME SERVE ME VALUE ME KNOW ME
  37. 37. Provide me with personalized recommendations and curated content to help me discover and choose the right products for my needs. INSPIRE ME 85% find a personalized experience where retailers automatically suggest, order or recommend products that best suit personal preferences appealing. Source: The Loyalty Divide. Oracle, 2018
  38. 38. Adidas LDN The London flagship of sportswear and footwear brand Adidas features a large digital display, called the Hype Wall, on the ground floor that informs shoppers of upcoming limited-edition drops and allows them to scan a code using the Adidas app in order to have a shoe’s drop date added to their calendars.
  39. 39. Adidas LDN
  40. 40. Adidas LDN
  41. 41. Integrate shopping into my daily life, providing me with access to the goods and services I need in the manner that’s most convenient for me. MEET ME Consumers are increasingly open to whatever gets orders to their door the fastest, with more than 90% seeking free one-day delivery by whatever means is fastest, including drone, driverless car or a messenger, compared to 43% in 2018. Source: Setting The Bar. Oracle, 2019
  42. 42. Kroger x Walgreens Supermarket chain Kroger is rethinking its store formats and supply chain in order to better serve customers’ needs. It is piloting a collaboration with pharmacy chain Walgreens to enable shoppers to order groceries online and then pick them up at select Walgreens locations.
  43. 43. Kroger x Walgreens
  44. 44. SERVE ME Don’t just sell me a product but provide me with a solution, making my life easier and ensuring I get the most out of my purchase. In order to feel like they have a meaningful connection to a given brand, 64% of consumers say that it is very or somewhat important that the brand provide educational or informational content that helps them get the most out of their purchase. Source: PSFK x Suzy Brand Connection Survey, 2019
  45. 45. Equal Parts DTC cookware brand Equal Parts offers customers 8 weeks’ worth of free access to a cooking coach with the purchase of any Equal Parts cookware kit to help them develop skills and confidence in the kitchen.
  46. 46. Equal Parts
  47. 47. VALUE ME Provide meaningful value that rewards my loyalty and shows me you’re there for 
 the long-haul. 80% of consumers are more likely to do business with a company that offers personalized experiences. Their top personalized experience was a reward program, with 31% naming it as their favorite.  Source: Power Of Me. Epsilon, 2018
  48. 48. Ruti Now, when customers walk into one of the brand’s stores, a series of cameras scan and take photos of customer faces. Those photos are stored in the brand’s CRM, along with information about each customer’s shopping habits and style preferences.
  49. 49. KNOW ME Empower me with digital tools that allow me to control my shopping experience while continually working to make my experience even better. 79% of customers are willing to share relevant information about themselves in exchange for contextualized interactions in which they’re immediately known and understood. 54% say a commitment to safeguarding their data strengthens their loyalty. Source: State Of The Connected Consumer. Salesforce, 2018
  50. 50. Choosy Fashion brand Choosy uses data to uncover trends on social media then quickly designs its own products based on the most popular styles and produces the items on demand.
  51. 51. Choosy
  52. 52. Personal Utility  INSPIRE ME MEET ME SERVE ME KNOW ME VALUE ME
  53. 53. HOW MIGHT RETAIL EVOLVE WITH PERSONAL UTILITY?
  54. 54. 2020 VISION: THE FUTURE OF RETAIL The next few pages situate the wider thinking on retail trends into speculative scenarios that envision the brave new world of retail. The explorations use real-life emerging trends to reinvent the future typologies of shopping malls, of grocery stores and of luxury retail. All of these explorations are responding to consumer desires for increased personalized experiences. The future consumer will be constantly immersed in a curated, flexible and seamless brand experience. The future customer is the centre of a Community of One: their needs will be anticipated, the products and services will be curated and data driven. They will be able to generate a full retail experience anytime, anywhere: from a bank anywhere to a store anywhere. Consumers ARE the accounts. The streamlining of the retail experience will lead to modular store infrastructures: from mega fulfillment centers to data-driven, instant retail experiences: in effect, the customers ARE the stores. X
  55. 55. THE FULFILLMENT CAMPUS The Westfield Fulfillment Campus reinvents the mall landscape and establishes itself as a whole-life destination. By removing the transaction infrastructure, the Campus blurs the boundaries between retailers, F&B, culture and entertainment, offering a new emotional landscape that is ripe for creating emotional connections between brand and customer. • The new modular mall is split into two distinct modular areas: • The infrastructure of the Fulfillment Core, rooted in transparency and AI-informed efficiency • The Living Magazine, a new mall landscape where brands support the whole-life development of their customers in a boarderless environment. X
  56. 56. THE ANATOMY OF FULFILLMENT Understanding the two sides of fulfillment making up the Westfield Fulfillment Campus. 1 FULFILLMENT INFRASTRUCTURE The AI-embedded Fulfillment Core stores, sorts and delivers in real time. 2 EMOTIONAL FULFILLMENT The Living Magazine is the new format of the mall, a cross- service, cross-brand landscape that customers navigate according to lifestyle with the aid of real time data. 3 THE MEASURE OF FULFILLMENT Quantifying levels of fulfillment and understanding how brands are delivering on their customer promise. 4 X FULFILLMENT CAMPUS
  57. 57. THE ANATOMY OF FULFILLMENT FULFILLMENT INFRASTRUCTURE Key components: 1 EMOTIONAL FULFILLMENT Key measures: Efficiency Transparency Intelligence Connection Loyalty Happiness X FULFILLMENT CAMPUS
  58. 58. 2 The Fulfillment Campus is sustained by a 360 transparency delivery core, an AI-controlled storage, packaging and delivery system. Centralizing the fulfillment core allows new to market brands to benefit from this inbuilt infrastructure and frees up all brands to deliver further on creating spaces for customers to belong. X THE DELIVERY CORE Fulfillment Infrastructure FULFILLMENT CAMPUS
  59. 59. THE LIVING MAGAZINE3 Fulfillment Infrastructure The Living Magazine is the ultimate form of lifestyle cross- merchandizing, bypassing individual retailers or brands. Allowing cross pollination of sectors to create a blended environment where brands can focus on creating relevant stories and experiences for their customers to engage with. X FULFILLMENT CAMPUS
  60. 60. MOMENTS THAT ARE ABLE TO CRAFT MEMORIES ENSURE HIGH LEVELS OF EMOTIONAL CONNECTION, WHICH LEADS TO A FEELING OF BELONGING IN VISITORS. X FULFILLMENT CAMPUS
  61. 61. THE MEASURE OF FULFILLMENT FULFILLMENT INFRASTRUCTURE Key components: 4 EMOTIONAL FULFILLMENT Key measures: Efficiency Transparency Intelligence Connection Loyalty Happiness Quantifying fulfillment on the Campus using embedded digital markers and wearable’s. Data is instantly collected and used to change the display algorithms and create tweaks in the personalized journeys. Mood trackers signal the level of contentedness in real time within a certain area, motion sensors track how long a customer pauses
 in certain spaces. The tracked data becomes a communication tool between brand and customer - a way for shoppers to understand their brand engagement. Innovation tech meets behavioral tech to allow brands and retailers to quantify fulfillment and deliver on the ultimate promise to the customer. X FULFILLMENT CAMPUS
  62. 62. EMOTIONAL FULFILMENT MARKERS Brands get live feeds and quantified data of how emotionally connected customers are in their environment or with their stories, this allows brands to be agile and test innovations in a live destination. Emotional markers above customers and fulfillment infrastructure X FULFILLMENT CAMPUS
  63. 63. CONNECTED GREENHOUSE Trader Joe’s is offering the gift of time freedom and a tailored shopping experience. It is a complete 180 transformation of your weekly grocery shop, in an intuitive and connected space that allows customers the pleasure of experience - instead of a chore, it gives back your time as leisure activity. X
  64. 64. CONNECTED CUSTOMER JOURNEY The grocery store of the future will exist amongst the Internet of Things: from health app, to smart kitchen, to grocery list, to your local store, all seamless linked. FROM AISLES TO ISLANDS Using integrated tech allows for a new display hierarchy
 in the grocery store, where pleasurable shopping experiences expand (such as fruit, cheeses or cosmetics) while mundane refills happen automatically and out of sight. SEAMLESS INTEGRATION AR navigation allows you to customize your time in-store by being your friend behind the scenes completing the mundane so you can spend time learning, playing and connecting. X CONNECTED GREENHOUSE 3 1 2
  65. 65. CONNECTED CUSTOMER JOURNEY 1 Illustration of 360 connected customer journey X CONNECTED GREENHOUSE
  66. 66. FROM AISLE TO ISLANDS2 By mixing automatic refills (like in a traditional online grocery shop) with the pleasurable aspects of in- person shopping, a new hierarchy of supermarket displays is created: from aisles to experience islands. AI uses the streams of data to create the streamlined shopping experience: mundane or favorite items such as bleach or rice refills are automatically added to your basket and ready for pick up or delivered direct to home. While the items that customers enjoy picking, such as fresh produce, cheeses, bread etc are inbuilt into the curated, multi- sensory journey. X CONNECTED GREENHOUSE
  67. 67. SEAMLESS INTEGRATION3 Customers use their phone or wearable to log desired items in a virtual basket. The aisles are scaled down to only display a single item per SKU - an RFID enhanced package that offers various degrees of information about each product from provenance, to health benefits, to recipes. X CONNECTED GREENHOUSE
  68. 68. THE GIFT OF TIME The new display hierarchy allows for pleasurable multi-sensory experiences to be curated throughout the physical store. Touch, feel, taste, smell and listen to the stories of the products you are buying. The transformation of the grocery shopping experience from chore to leisure X CONNECTED GREENHOUSE
  69. 69. MINI MAISONThe LVMH Salon is creating an aspirational, interest based digital “inner circle” social platform that democratizes luxury and the art of the connoisseur. The Salon uses a digital platform, the Curator app, together with a Mini Maison piece of luxury home tech, which becomes a portal into real store experiences. “EXCLUSIVENESS, NEAR UNIQUENESS, AND NOT BECAUSE IT IS ADDRESSED TO FEW PEOPLE BUT BECAUSE IT IS SPECIAL. LUXURY IS RESEARCH, THE CHANCE TO EXPLORE NEW ROUTES. CRAFTSMANSHIP IS LUXURY.” - Vogue Italia, Francesca Sozzani - Mini Maison situated in a home environment X
  70. 70. THE CURATOR APP Download the app and create a profile where you tailor your interests around four LVMH pillars: Fashion, Cosmetics, Jewellery, Spirits. CUSTOM MINI MAISON A Mini Maison is a piece of luxury home tech crafted specifically with your profile in mind: from materials to ACTIVATION Sync your Mini Maison to your app and location to get tailored content that you ordinarily wouldn’t have access to. GROWTH AND LEARNING The Mini Maison learns from you: your purchases, your online searches, your app interactions. New personalized content is constantly updated, developing with the individual. STEPS TO JOINING X MINI MAISON 1 2 3 4
  71. 71. THE CURATOR APP1 The LVMH Salon offers different tiers of engagement. The digital interface is the first platform, where each member creates their profile and explores their interests based on the four main pillars
 of the LVMH Group - Wine & Spirits, Fashion & Leather Goods, Perfumes & Cosmetics, Watches & Jewelry. The digital profile results in the ultimate subscription box, which is comprised of a couture wearable that is paired with an own-able home device - the Mini Maison. The wearable and the tabletop device curate content based on the ever- developing profile and taste of the member. X MINI MAISON
  72. 72. THE MINI MAISON: THE ULTIMATE SUBSCRIPTION BOX 2 STEP 1 Each Mini Maison is a piece of hand-crafted luxury home tech embedded with the content tailored to your own personal tastes. The materials and components of the Mini Maison can be tailored to your profile. X MINI MAISON
  73. 73. STEP 2 The Mini Maison is custom to every member and features a personalized activation plate, engraved with the name and taste markers of the person. The plate can be updated remotely with the customer informed when new updates are available. STEP 3 You can activate the experience by unlocking the experience pillars when the activation plate is removed. Inserting the activation plate into a slot automatically links your Mini Maison to tailored content. Four pillars of LVMH at the center of the Mini Maison X MINI MAISON
  74. 74. MIXED REALITY PERFUME ACTIVATION USING LIGHTING, SOUND AND SCENT 3 Activated Mini Maison showing engaging personalized cosmetics content, delivered through scent atomizers and AR overlays PLAY VI D X MINI MAISON
  75. 75. THE MINI MAISON IS A PORTAL INTO SHOPPABLE EDITORIALS OR EXCLUSIVE EVENTS Activated Mini Maison showing engaging personalized fashion content, delivered through integrated speakers and AR overlays PLAY VI D X 4 MINI MAISON
  76. 76. Personal Utility  INSPIRE ME MEET ME SERVE ME KNOW ME VALUE ME Advanced computing, delivery logistics & connected tech power a hyper-personalized retail experience with the objective of anticipating shopper need and providing exceptional service
  77. 77. About PSFK PSFK is a business innovation platform for creative professionals. Since 2004, we’ve provided insights, research tools, advice and immersive experiences to help our members as they build better products, services, marketing and retail. • Full access to a library of 250+ Trends Research Reports • Access to Analyst Engagement services with ability to request bespoke reports • Full access to a database of 150,000 creative business ideas (updated daily) • Full access to industry-focused newsletters and keyword alerts PSFK MEMBERSHIP INCLUDES: PSFK leverages its research findings, strategic recommendations and other conceptual work to develop 1-day workshop sessions. These sessions are structured as a collaborative discussion to present the team with research and encourage new and broader thinking. By the end of the session, the goal is to have identified at least 3 blue sky strategies and 8-12 quick win initiatives. OUR WORKSHOPS: PSFK analysts combine analysis from trends research, competitive review, client data and expert opinion to identify higher-level brand engagement strategies and tactical initiatives. Deliverables include strategy playbooks, product and service concepts, consumer scenarios and prototypes BESPOKE RESEARCH: CONTACT Jeff Weiner | jeff.weiner@psfk.com | 460-520-5672
  78. 78. The PSFK x Suzy Future of Retail 2020 Survey Quantitative research featured in this report was taken from the PSFK x Suzy Future Of Retail 2020 Survey, a bespoke, original survey of 500 US consumers age 18-55, conducted in partnership Suzy, the real-time consumer polling platform. Key findings: •78% are interested in receiving personalized recommendations or coupons/offers that are relevant to their current needs while they are shopping in a store •76% will shop locally at different branches of the same retail chain if they provide different products and services •63% are interested in purchasing a product that comes with related services to help them get the most out of their purchase •90% are interested in being able to choose the types of rewards that they receive from a brand or retailer’s loyalty program •70% expect a retailer to offer them the same level of personal service across destinations whether they are shopping in a physical store, online or on their mobile device
  79. 79. Suzy is a consumer intelligence platform that helps brands and retailers make better, more informed decisions faster. Powered by an on-demand network of more than a million consumers, Suzy lets you target and retarget any consumer segment to ask questions and get insights from shoppers in minutes. Some of the biggest retailers in the world use Suzy to validate critical decisions, better understand their customers, increase conversions and drive growth. ABOUT SUZY For more information about Suzy services: suzy.com/psfk Jeff Weiner, Head of PSFK Membership - Jeff.Weiner@psfk.com
  80. 80. About YourStudio YourStudio creates pioneering experiences that connect people to brands. By continually driving fresh thinking across strategy, brand communications & experience design; we help brands define what’s now and what’s next. Continue the conversation: danny@weareyourstudio.com tom.e@weareyourstudio.com Your Studio
 100 Leonard Street, Shoreditch
 London UK + 44 (0) 207 033 2809 AUS +61 451 161 087 weareyourstudio.com @Your_Studio @weareyourstudio
  81. 81. psfk.com/report/future-of-retail-2020

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