Groundbreaking Trends in Retail Tech Innovation

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Retail Tech Innovation - Trends

Leading tech trends that are driving the retail industry include cashless shopping, use of AI to create omnichannel shopping experience, use of chatbots, voice search, and visual product search. Below is a detail review of these trends.

Cashless Shopping

  • The retail industry is increasingly re-imagining ways of freeing up staff members from menial and time-consuming tasks. Many retail companies are investing in tools like facial recognition, IoT devices, machine learning, computer vision systems, and RFID tags.
  • One of the pioneer products in this area is the cashier-less Amazon Go store chain. Although it is not entirely free, Amazon Go enables customers to use their smartphones to shop quickly, without checkouts and time-consuming lines.
  • It is these advantages that are attracting major players in the merchant terminal industry like MasterCard which launched unmanned checkout technologies for convenience stores.
  • MasterCard cashless technology uses sensors and smart shelves to attach physical products to a shopper's virtual shopping cart
  • In 2017, KFC introduced face-based retail technologies that were attached to predictive systems. Using the technology, the food chain was able to remember the favorite food of its customers based on the past buying habits. In the process, the company reported significant improvement in sales.
  • In 2018, CaliBurger launched a system that is able to recognize faces and streamlines the process of ordering.
  • To expand on this technology, Amazon Go is seeking airport space and has plans to set up 3,000 stores by 2021.

Using AI to Create Omnchannel Experience

  • The retail industry has seen the emergence of a new age of omnichannel marketing, which means customers are now looking out for those channels that offer seamless experience.
  • Many customers visit stores, search websites, and use their mobile phones to search, compare and even buy products.
  • A report compiled by Harvard Business Review in 2017 indicated that 73% of shoppers used multiple channels to shop.
  • To address these changes, top retailer are now offering several omnichannel options like Return In Store (BORIS), Pick-up In Store (BOPIS) or Buy Online, and Buy Online.
  • Although 70% of Millennials shop online, many Americans split (50/50) on whether to shop online or in-store.
  • Among those who prefer in-store shopping, 34 percent say it takes too long to deliver items bought online and 25 percent are reluctant to pay high shipping fees.
  • Companies that are offering omnichannel shopping options include Amazon and

The use of Chatbots to personalize and improve in-store and online experiences

  • Chatbots is another application of AI that is gaining ground in the retail industry. Retailers are using chatbots to improve how they serve customers, help customers locate new items on the site, inform them of new products, and align their tastes with marching products.
  • Companies are using chatbots as backup for customer service representatives. A 2018 study on the State of Chatbots revealed that 64 percent of customers like chatbots because they offer services 24 hours. 55 percent like chatbots because they are able to get instant answers to questions.
  • 80 percent of retail brands are using or plan to use chatbots. Tommy Hilfiger and Burberry are already using AI-driven bots on Facebook Messenger.

Voice Search

  • Voice-based search has become the latest trend in recent years thanks to new versions that are compatible with smartphones and television sets.
  • The logic behind voice search is that fact that a person is able to speak more words that he/she can type.
  • The rise in the use of voice-activated systems has been fueled by companies like Google and Amazon with their Google Home and Alexa respectively. Other companies that are driving innovation in this sector are Sonos and Apple.
  • According to a report NPR and Edison Research, around 53 million Americans currently have at least one smart speaker system at home.
  • A report by Capgemini predicts that in the next three years, 40% of consumers will shift from using text search via smartphones or websites to using voice search.
  • 27 percent of people around the world are using voice search on their mobile phone. 34 percent of consumers who use the internet plan to buy a voice-controlled smart assistant.
  • On the motive of use, 52 percent of consumers use voice-enabled smart devices because they are convenient, 48 percent use because they are able to accomplish tasks without using their hands while 41 percent use because automation is part of their routine shopping.
  • Currently Google Assistant is compatible with over 5,000 smart home devices. Over 225 retail brands support Google Assistant. On the other hand, Alexa works with more than 20,000 devices and is being used by over 3,500 retail brands.

Visual product search

  • Many retailers are opening visual search to retailers. This feature allows customers to upload images and find similar or identical products.
  • This feature is being powered by Artificial Intelligence, which scrutinizes and analyses the image's features like colors, shapes, and patterns.
  • London-based AI company Cortexica launched an image recognition technology which offers 95 percent accuracy.
  • Retail brands that are using this technology include John Lewis and Eagle Outfitters. Pinterest’s Lens uses the camera on the Pinterest App and AI technology to search for visually similar pins.
  • Between February 2017 and 2018, searches on Lens skyrocketed by 140%, confirming that visual search is not only here to stay, but is ago growing its footprint.

Research Strategy

We managed to get the major tech trends driving the retail industry. For the trends, we selected those events that are happening on a wide scale or growing in use. We considered those that are affecting the highest number of retailers, customers or both. In addition, these trends are attracting some of the biggest tech investments in the retail space. Finally, these trends have been reported in multiple sources we reviewed.


  • "One of the most promising concepts in this area is the cashier-less Amazon Go store chain. Despite being not completely staff-free, it still allows smartphone-wielding customers to shop quickly, without time-consuming lines and checkouts. Vendors in the merchant terminal industry are also getting onboard, with Mastercard showing off unmanned checkout technologies for use in convenience stores. Using smart shelves, sensors can be utilized to tie physical products to a customer's virtual shopping cart. IoT-based systems can then identify when they and the items exit the store, at which point the sale is registered to their credit card."
  • "This year is likely to witness much more movement on smart/automated/cashierless checkout schemes. Amazon may be poised for a more rapid expansion of Amazon Go if reports are correct that it's seeking airport space and mulling a plan to open 3,000 stores by 2021. But other technology companies, like Standard Cognition, are saying deployment of their solutions by other retailers will begin to ramp up this year."
  • "Omnichannel isn't a new concept by any means, but this year it's going to hit its stride. As interest in the multichannel shopping experience has grown, customers have been adapting with a bevy of new purchasing behaviors that utilize the convenience of both online and offline channels. Top retailers have addressed these changes by offering more omnichannel options, such as Buy Online, Pick-up In Store (BOPIS) or Buy Online, Return In Store (BORIS)"
  • "It’s 2019, and omnichannel commerce is still a buzzword. In 2017, Harvard Business Review reports that 73% of shoppers used multiple channels to shop. The rise of omnichannel is sure to continue in 2019, so retailers need to offer a consistent buying experience across channels, both online and off."
  • "Almost 70% of Millennials are shopping online, but that doesn’t necessarily mean businesses should abandon brick and mortar. Americans are still split 50/50 on whether they prefer online shopping versus in-store shopping, with in-store being the dominant channel for Boomers and Seniors."
  • "Consumer expectations continue to increase when it comes to fast and free shipping with large retail incumbents, such as Amazon and, or third-party delivery services, such as Instacart and Rappi, setting the bar. It’s no surprise that retailers intend to invest in speedier delivery options. Around 20% of respondents plan to invest in same-day and two-hour delivery in the next 12 months."
  • "People don’t want to say bye to brick-and-mortar stores for a couple of critical reasons: 34 percent say it takes too long to deliver what they bought, and 25 percent are reluctant to pay high shipping fees. Furthermore, people tend to spend more when buying in person. For example, though 51 percent of Americans surveyed by Entrepreneur prefer to shop online, it is also reported that physical stores sell 10 times more than e-commerce shops, and people spend 64 percent of their shopping money in brick-and-mortar shops, compared with 36 percent online."
  • "Chatbots are one more popular application of AI in the retail industry. Chatbots help retailers to provide great customer service, help customers find items on the site, notify them about new collections, and offer them apparel similar to things they’ve already chosen. For example, if a customer has already added black jeans to the cart, a chatbot can offer them new silver Converse shoes to finish the look."
  • "Voice commerce, which lets shoppers select and buy goods via a digital assistant, adds a new channel to traditional in-person and digital purchasing. As Amazon Pay vice president Patrick Gauthier noted at NRFtech, Amazon’s Alexa devices let consumers browse, purchase and reorder products simply through speech. And AI-driven Alexa will recommend products based on consumer history and behavior."