The store of the future

Tomorrow’s in-store shopping experience will be seamless, immersive, and driven by digital

Retail has always been an industry that never sits still. Now we sit post-pandemic and mid-4^th Industrial Revolution, and change will come faster than ever before. So, how will stores change as we hit 2030 and beyond?

We asked our team for their predictions about the short and mid-term future of in-store shopping. Here are five things to look out for:

Loss prevention grows up

Theft and other shrink factors have now hit unsustainable levels. With governments hamstrung by poor finances and unable to legislate or increase police presence and other deterrents, retailers are looking towards technology to solve the loss crisis. In the short-term, this includes reviews of security and self-checkout operations, including adopting technology like Flooid’s Empower solution to alert staff to suspicious behavior. RFID, which enables tagging and tracking products in-store, is gaining investment and adoption. By 2030, our team expects more retailers to have invested in RFID and computer vision and AI systems that can identify products. This will not only reduce theft but could also lay the foundations for lower-interaction shopping, such as checkout-free shopping in physical stores, enable smoother checkout journeys and improve supply chain logistics. However, the initial outlay cost of new infrastructure and operational practices may delay widespread adoption beyond 2030. Another area to watch is age-verification transactions which are often closely aligned to other transaction types requiring guardianship. With labor shortages an ongoing concern, and technology maturing as well as society becoming more accustomed to camera-based interactions, it’s entirely feasible to see more alcohol and cigarette vending machines using AI-based age recognition to approve purchases.

An age of experimentation

A fast-moving geo-political movement is creating economic waves, some retailers are exercise caution with big technology rollouts. Fortunately, cloud-native and composability, key features of solutions offered by Flooid, allow retailers to experiment with new concepts faster and more cost effectively than ever before, offering even greater insights into what will drive value and what will be accepted. Short-term we’re expecting this to lead to many more pop-ups and mobile-only stores, particularly during peak shopping periods. The maturity of AI, IoT and new types of augmented/virtual reality, will also mean that post 2030, the range of in-store shopping experiences available will become much wider. The metaverse may play a part, but we feel this is a decade or more away from mass adoption. Before then, we’ll see holograms, and new store formats with checkouts spread throughout the store rather than deployed in banks of three or five. Overall, we’re heading to a more immersive, more diverse, more personalized, and more tailored in-store experience.

Operational excellence

An explosion in the number and quality of data endpoints will prove to be a goldmine for any business with the capabilities to sort, extract and monetize vital information. Those that can unify and understand their data will be able to develop promotions and hone customer journeys that deliver much greater and higher conversion. AI learning will provide further insights on dwell time and in-store movement. Automation will contribute to process design and execution excellence, creating more time for retailers to fine-tune the in-store customer experience. For the retail operation, this AI/automation combination will mean a more targeted inventory, reducing overhead and waste, resulting in a more profitable business. For the shopper, this means more relevant and enticing offers, delivered to personal mobile or wearable devices when they enter or reach the proximity of a store as well as in-aisle. Convenience will be another key benefit, with more stores able to handle mixed payments, mixed fulfilments and mixed baskets, from shopping journeys that cross physical and digital channels.

Payment innovation

In-store interaction is no longer limited to the manned checkout, with Flooid already helping major retailers to deploy self-service solutions such as self-checkout and kiosks, as well as checkout-free and mobile self-scan options. The digitalization of payments will continue to grow, with palm and face pay potentially gaining traction – if privacy and security concerns can be allayed. We have already seen the uptake of Square, Curve and other softPOS options that enable payment to be made without having to go to a specific pay point. The flexibility to capture payment anywhere is key to cultivating the capture of previously lost purchases due to decision time between picking up the product and interacting with a till.

New concepts from new players

The ‘theater of retail’ will gain new impetus when Netflix opens its first brick and mortar stores in 2025. Live entertainment will mix with merchandise purchasing opportunities and a hospitality offering in these new immersive retail playgrounds. Other non-retail and digital-first retail brands will enter the physical retail space. We’ll also see further merging of retail verticals and many more diverse brand collaborations as shops become ‘experience centers’ that happen to sell products. High Street shoppers will have more choice, more variety, and more surprises as they browse and buy.

While the future of stores is uncertain, it’s sure to be an entertaining ride for those who care about the retail business. If you’d like to learn more about how to prepare for a future-ready store, download our Store of the Future white paper here.