3 Technologies to Reshape The Retail Industry Landscape During The Pandemic

COVID-19 has disrupted our personal lives and deeply impacted business processes. Consumers spend money differently now. Some retailers have successfully met these changes, but others have fallen short.

As a software developer with a specialty in retail business performance, I have witnessed the technological trends embraced by successful retailers. Successful retailers are overcoming this crisis and positioning their businesses for future success.

The trends leading to successful outcomes in this new retail landscape are IoT, machine learning and augmented reality.

IoT to Ensure Social Distanced Checkout

Trends in cashier-less technology such as Amazon’s Just Walk Out system and Walmart’s scan-and-go checkout-free retail system have gained popularity during this time of social distancing. Early adopters of the technology will benefit in this new retail landscape as the demand for technology grows.

A recent survey by Shekel Brainweigh Ltd revealed that 87% of U.S. customers are more likely to choose retailers that offer contactless checkout. Customers who shied away from these tools are now trying them out. About 67% of customers are using self-checkout, touchless self-checkout or nearby micro-markets to make payment for groceries. Fewer than 33% of survey participants ordered groceries online.

While Walmart’s scan-and-go check-out free retail is being deployed in Canada, U.S. consumers are familiar with Amazon’s Just Walk Out system. Customers enter a store and place physical items into a physical cart. IoT systems track the items in a corresponding virtual cart. Once the customer finishes shopping and leaves the store, purchases are automatically paid.

Amazon Go's Grocery model relies on RFID and Bluetooth technologies. Retailers interested in creating an end-to-end, touch-free shopping system can take this one step further. Items are marked with QR codes. Customers scan the code using their smartphone. They can learn more about the product or mark it for checkout without touching an item, further reducing direct in-store interactions.

In March 2020, Amazon began selling its technology to other retailers.

Machine Learning to Forecast Future Sales

Many retailers are asking: “How will the COVID-19 pandemic impact demand and how can we predict sales shifts?”

Traditionally retail businesses turn to big data to forecast consumer behavior. Unfortunately, legacy data and traditional data models are incapable of rapidly adjusting to sudden demand changes, for example, in toilet paper and sanitizer supplies the current pandemic caused. Fortunately, machine learning forecasting models have been in place before the pandemic. Machine learning approaches problems using rapid, innovative methods. The result is optimized business processes like B2B and business-to-consumer relationship management, logistics, manufacturing processes and smart marketing campaigns.

ML-powered demand forecasting based on NLP and cascade models employ short-term POS data for up-to-date adjustments and gather recent data from external resources. Exchange rates, market fluctuations and economic shifts are factored into system models to enhance the accuracy of demand forecasting. Smart retail environments are putting ML-powered demand forecasting to use with successful outcomes.

Augmented Reality to Virtualize Shopping

Gartner’s 2019 predictions report suggested that up to 100 million consumers would use augmented reality in their 2020 shopping experiences. The current crisis proves the prediction's validity.

The COVID-19 quarantine is increasing consumer demand for AR. Consumers still want to “try-before-you-buy” and augmented reality allows consumers to interact with products virtually from home.

The technology isn’t new. Before the pandemic, many fashion brands debuted virtual showrooms and fitting rooms. IKEA and Amazon enabled AR apps that helped customers visualize products. Potential customers use their smartphone cameras to superimpose furniture images over their existing living space to create real-time images of room updates.

Apple’s LIDAR scanner is even more sophisticated. Customers place virtual items on existing physical surfaces with great degrees of precision. The platform differentiates between real and virtual goods, allowing shoppers to compare and contrast physical items with virtual ones. This is helpful when shoppers search for replacements for older products or seek upgrades. AR provides realistic interactions between virtual and physical objects.

Future of The Retail Industry

Retail's future is not apocalyptic. Retailers that adapt to changing conditions, seek out opportunity and put retail technology innovations to practical use will find success in 2020.

Written by Liudmyla Taranenko, Data Scientist at MobiDev.