The world of retail is undergoing an unprecedented wave of innovation. Technology innovations, new business models and evolving consumer expectations drive the changes in e-Commerce landscape. Criteo, the performance marketing technology company teamed up with Ovum, a leading global technology research and advisory firm, to take a look at what the e-Commerce industry will look like in the next 10 years. The report findings help to make the right investments for online business.
In the report commissioned by Criteo, Ovum interviewed thought leaders across the e-commerce ecosystems, including leading retail brands from a spread of market sectors. The findings enabled to build a vision of the future of eCommerce and debunk key myths related to e-Commerce.
Myth nr 1: Physical retail will cease to exist
In reality in store shopping will exist but will change, becoming a form of entertainment. By 2026, many consumers will want retailers to provide an environment where shopping is an event experience in its own right, often at the expense of the immediate availability of a large range of products. Demand for large footprint physical retail space will continue to fall, as the need to keep complete inventories in stock at every store diminishes due to improved logistics built around online delivery and the click-and-collect model. This will increase the pressure on the existing space to be more efficient and offer unique shopping experience.
Myth nr 2: Drones and driveless cars will replace delivery vehicles
The desire for instant access and fast turnaround, 24/7, will be the norm by 2026, driven in particular by millennials (born approximately 1980–95) and also by Generation Z consumers (born approximately 1996–2010). The retail winners of 2026 will be those that can get goods to consumers the fastest and most costefficiently. The largest players will invest in their own delivery systems in order to gain differentiation, as Amazon has already done.
However, the use of drones and driverless cars for delivery will not be widespread by 2026, largely due to security and safety issues. Concerns on this front will be a catalyst for investment in other models, such as on-demand delivery, click-and-collect model or Uberstyle delivery, that will reach the mass market.
Myth nr 3: All shopping will be done on smartphones
The traditional concept of a universal, linear shopping journey that all consumers follow, by 2026 will be completely outdated. Due to the proliferation of wearable devices, smart TVs, connected cars, household appliances, beacons, and other technologies, the consumer journey in 2026 will become increasingly complex. Consumers can start and end their shopping experiences on a mobile platform, in store or online. One of the key conditions for success for retailers in 2026 will be their ability not only to keep track of users across a growing number of devices and touchpoints, but also to figure out how to effectively measure which of those are most effective at driving sales.
Myth nr 4: Silos make the best approach
The first phase of the omnichannel evolution that we see today is often characterized by a silo approach, whereby different channels have different marketing, merchandising, accounting and supply chains. This is essentially a multichannel strategy without integration. Marketing messages, pricing and product availability can be inconsistent across channels, leading to frustration for consumers. However, by 2026, we expect retailers to have addressed these issues, and instead of thinking and executing in terms of channels, they will instead view consumer touchpoints as working together to support an integrated, consistent omnibrand experience.
The retailers that will thrive will be the ones that allow customers to shop when, how and where they want to. This requires significant investment in technology and logistics and will be a struggle for smaller physical-heritage retailers.
Myth nr 5: We’ve already enough customer data to be successful
The range and depth of customer data insight will proliferate over the next 10 years. There will be more digital services, platforms and devices than ever before capable of generating data insights. These multiple sources of data, combined with the everimproving capacity to reconcile data coming from different devices, will enable an increasingly rich view of the consumer, moving from today’s still largely two-dimensional view to one that is fully contextually relevant. What will be even more important for retailers to understand will be how these multiple customer insights relate to touchpoints in the consumer shopping journey.
Full report available here: http://www.criteo.com/resources/ovum-future-ecommerce/