Imagine a vending machine that registers a customer’s ethnicity before it recommends what drink they buy. Or a changing-room mirror that lets a shopper pay for all the clothes they’ve tried on at the touch of a screen, without going to a till.
These inventions, as explored in our video above, are just two of the cutting-edge designs on display at the ninth Retail Asia Expo, held this week in Hong Kong for retailers, buyers and marketers to discover the latest ways to improve one of the world’s favourite activities: shopping. This year’s event marks an interesting turning point for the industry, explains Jonathan Cummings, chairman of retail consultancy Fitch HK, which is running a special “trend trail” to introduce visitors to highlights of the expo.
In 2017, retailers are finally starting to understand the modern consumer and put their dreams and desires at the heart of the shopping experience, says Cummings. At the same time, technology and software that has been in development over the last few years has now matured to the point where it is ready for mass rollout.
Artificial intelligence, predictably, will become a dominant force in the changing retail landscape. “Major players from Salesforce to IBM are investing huge amounts of money into AI,” says Cummings, introducing “Einstein”, a machine learning bot developed by the CRM software company Salesforce, that can, among its range of skills, automatically match up complementary items, predict customer behavior and personalise product recommendations.
The real-time customisation of the shopping experience is another key trend, says Cummings, as exemplified by companies such as three-year-old Hong Kong business Tofugear and Intel’s Responsive Retail Platform, newly launched in Asia following its introduction in the US.
Both firms use radio-frequency identification (RFID) tags to track products around a shop floor in order to simplify inventory replacement and to suggest related promotions to the shopper via mobile apps. Tofugear has also developed the aforementioned “connected fitting room” that sends key data—such as a customer only purchasing one of two items they have tried on - back to sales associates, as well as offering outfit-building advice and different lighting filters from “savannah sunset” to “tropical twilight”.
Investment in innovations such as these hasn’t—until recently—been prioritised in Asia to the extent that it has in more developed parts of the world, Cummings tells Campaign Asia-Pacific. “In Hong Kong and in most of Asia you've had quite rapid economic growth, sustained over a number of years, which has meant that retailers haven’t necessarily had the same urgency to innovate as somewhere where you've got a flat economy, like in North America or Europe, where to differentiate you’ve got in invest, you’ve got to create something special to just maintain—never mind grow—market share. As we have a relative economic adjustment here in Asia then I think we'll start to see a little bit more investment into innovation.”
Shopping malls offer particularly strong opportunities for reinvention, he continues, particularly in high-density urban regions such as Hong Kong and Singapore. “It’s about the malls having a more direct connection and relationship [with the shops] and linking the whole experience together a bit more.”
Airports, too, are in desperate need of a retail makeover, he thinks: the concept of a ‘smart airport’ will only truly live up to its name when it can take the same principles of connectivity that are being developed for baggage delivery and security and apply them to the F&B and retail arenas too.
“At the moment airport shops are just boxes that you have to physically visit in order to buy something. Yet we spend most of our time in an F&B outlet or at the gate. Why can't I shop from there? And why can I only shop what's available in the airport where I am? I am travelling to a destination. It would be brilliant if I could actually explore that destination and set up visits to certain stores or table reservations or whatever it might be.”