From Back to the Future’s robot waiters to Minority Report’s facial scanner, books, movies and TV shows have long had an infatuation with the future. And many times, they were right. With much of today’s commerce taking place via digital means, technology is moving faster than ever to accommodate consumers’ ever-changing purchase behaviors, shopping preferences and overall digital mindset.
As we round the corner into the third decade of the 21st century, tech has caught up with many of the imagined futures set out for us by the cinema of the past—and it’s all in the name of a better consumer experience. Gary Bacon, global managing partner (retail store transformation practice) at NCR, says, “the technology is just an enabler of the experience.” So how does today’s increasingly personalized tech translate to a better, more modern customer experience?
Pop culture predicted what retail would look like today. So what comes next? In this article, we’ll look at how storytellers fared at predicting the 21st-century retail landscape, then walk through the ways China is leading advancements in futuristic retail.
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Pop culture predicted the modern retail experience
The entertainment industry has always envisioned how people would shop, eat and buy decades into the future. Turns out, some of the futuristic world-building they did was right.
Back to the Future Part II: robot waiters
In 1989, Back to the Future Part II imagined a 2015 where diner visitors are greeted by a virtual waiter on a TV screen. Today, robot waiters greet customers in China and the Netherlands, and a newer iteration is making waves.
First of all, Back to the Future wasn’t far off in terms of timeline. In 2016, jiqiren, or “machine-people,” rolled around Together Restaurant in Beijing, playing pop music and delivering dumplings to patrons. And although somewhat helpful, robot servers are typically more of a statement than a practicality. Wang Peixin, who owns Together Restaurant, told The Wall Street Journal, “Young people like to pursue what’s new, and robots are a fashionable, modern style of service.”
Today’s service robot is named Servi, and it’s already fed more than 200,000 customers in Japan, Korea, and the U.S. Japanese technology, energy, and financial corporation SoftBank Group partnered with California-based Bear Robotics to introduce Servi to the hospitality sector. In the age of contactless service, Servi makes safe dining experiences more feasible for restaurants—if they have the funds. According to Reuters, Servi will run hospitality businesses for “99,800 yen ($950) per month excluding tax on a three-year plan.”
Minority Report: facial recognition technology
In 2002’s Minority Report, an upbeat virtual assistant personally greeted Tom Cruise’s character during a visit to The Gap. Today, facial recognition technology is used to unlock smartphones and ... buy fried chicken?
In 2017, Chinese multinational technology company Alibaba launched "smile to pay" inside of a KFC in China. According to TechCrunch, “the payment process doesn’t require a smartphone, assuming that the customer has already signed up for the Alipay app and enabled facial recognition.” Smile to pay was, according to WSJ and fast food restaurant company Yum China Holdings Inc., “the first commercial application of the facial recognition payment technology globally.” But it isn’t as effective as Alibaba might have hoped.
Alipay users are reluctant to use the technology today. The WSJ article cites “A survey of more than 6,000 people in China last October,” saying it “found that nearly 80% were concerned about personal information leakage due to the use of facial-recognition technology.”
One theory for the lag in the growth of facial recognition payment is that it isn’t quite as convenient as QR codes. Which leads us to ask: At what point is technology too convenient? Our hunch is that today’s consumer still wants to take part in some aspect of the physical buying process, even if it’s the simple scan of a code.
Blade Runner: electronic billboards
In 1982, Blade Runner predicted perhaps the most obvious (and timeless) tech of the group—electronic billboards. Although the film is set in Los Angeles in 2019, e-billboards have been around since 2005. Today, they’re making a comeback.
Simply put: Billboards are cool again. Otherwise known as out of home (OOH) advertising, billboards had a renaissance in 2017 when they surpassed TV, radio, magazine and newspaper ads with 31 consecutive quarters of growth. It’s no surprise billboards have stuck around for as long as they have—they are historically and currently an affordable (and effective) advertising avenue.
As more billboards go up, the cost to business owners and advertisers will go down. Digital billboard company Blip serves small-to-medium-sized businesses, with options starting at just $20/day. Plus, as e-commerce continues to grow, so will OOH. Research by Lamar in 2019 showed that “66% of smartphone users took some type of action on their device after seeing an out of home ad.”
As with many retail trends, COVID-19 slowed billboard advertising’s growth. But research by The Harris Poll and Out of Home Advertising Association of America (OAAA) from September found that “nearly half (45%) of American adults [are] saying they are noticing OOH advertising more than before the pandemic began,” according to the press release.
Digital billboards are the only pop-culture prediction that remains bigger in the U.S. than it does in China. As reported by Meticulous Research®, by 2027, the digital signage market is expected to reach $26.3 billion globally. Although North America owned much of the market share in 2019, the Asia-Pacific region is expected to see massive growth. According to the report, “The region has a large number of young and tech-savvy population which is the target population for digital signage.”
All of this to say: China is ahead of the curve and not just when it comes to billboards.
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Where does retail go from here? Look to China.
The tech goes where the market is, and China is the leader in retail innovation for good reason—they’re miles above the competition. According to the latest global e-commerce report by eMarketer, “62.6% of all digital sales will take place in [the] Asia-Pacific [region].” The Asia-Pacific region pulls in more than 3X more e-commerce sales than the U.S., $2,448.33 billion and $749 billion, respectively.
It goes without saying that e-commerce is growing—and Bacon says to get in on that growth now. When asked what advice he’d give to his dad, who owns a luxury retail shop in the UK, he said it would be “opening up his marketplace to a broader market by continuing to flesh out e-commerce” and pairing those efforts with the in-store experience.
China is also a leader in brick-and-mortar sales—they’re pivot pros. Following the COVID-19 slowdown, their retail industry made an impressive recovery. According to HBR, China’s retail supply chain recovered “by more than 50% just a few weeks after the outbreak, and it was able to supply 60% of the stores that were reopened during this period — three times as many as some competitors.” They managed this recovery by anticipating consumer “stock up” behavior (and, therefore, anticipating store sellouts), continuously tracking stores’ reopening plans, and adapting supply chain efforts to online efforts rather than offline.
Our hunch is that this anticipatory behavior will only get more accurate as time goes on—and it can be used to further personalize the shopping experience for consumers.
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The future of retail is both digital and personal
The future of retail is clear: It’s digital, and it’s personal. In 2020, eMarketer anticipates worldwide e-commerce sales to hit $3.914 trillion—and that number will only continue to grow as brick-and-mortar makes the switch to digital first. Plus, the majority of U.S. adults want personalization from retailers.
As for pandemic-level personalization, augmented reality (AR) takes it to the next level. When COVID-19 shuttered physical stores across the world, what was once a cool add-on became necessary for many retailers. AR allows for “try-before-you-buy” type conveniences, allowing for consumers to virtually “try on” outfits, accessories and makeup. Many big brands have seen increased sales—some by as much as 80%—by offering AR and virtual reality (VR) options to customers.
Increased personalization is big among younger consumers, as well, so a digital adoption strategy is inevitable for retailers everywhere. By the end of 2020, it’s projected Generation Z will make up 40% of the consumer base in the U.S. alone, and the Gen Z consumer base lives digital-physical lives. Every purchase includes a personal, digital touchpoint—whether that’s through social media, store research or how they make a final purchase.
Doug Stephens, a futurist, author, and self-proclaimed “Retail Prophet,” projected that, by 2033, most of our day-to-day purchases will take place digitally. In an interview with Retail Dive, Stephens said we’re nearing what he calls a “Replenishment Economy,” where items like “automobiles, jewelry, real estate, perishable food items, pharmaceuticals, home furnishings, luxury items and home improvement products” will “represent the next frontier of online commerce.”
With digital-first in mind, remember: Brick-and-mortar isn’t going anywhere. One way smaller retail operations can prepare for the tech to come is to take inspiration from the hospitality industry. Many brick-and-mortar businesses, like gyms and salons, already use reservation systems for better control over occupancy—and, ultimately, the customer experience. Retail stores can do the same thing.
In any case, bridging the gap between physical and digital will be any retailer’s best bet to capture a value-driven audience. Bacon says that the experience should always be the driver of the tech. “There’s some really cool stuff out there, but if you don’t know the lasting impression you want your customers to leave with, you can never know what technologies you should use to enable those experiences.” And that’s the most futuristic mindset you can have.
