IDC Retail Insights: Top 10 Predictions for Global Retail
The need for digital transformation, more integrated IT and operations, business security, and rethinking the future of work are among the themes that dominate IDC Retail Insight’s top 10 predictions for worldwide retail 2017.
While the predictions largely focus on the near- to mid-term (2017–2020), the impact, in some instances, will be felt for years to come, according to IDC. Most of the predictions refer to a continuum of change within the wider ecosystem of the retail industry and global economy.
Below are IDC’s top 10 predictions:
1. By 2019, digital transformation Investments will triple, drawing funds away from store capital and profoundly changing the retail industry;
2. In 2017, no less than 40% of new retail applications purchased will be deployed in the cloud to speed and secure business objectives.
3. By 2018, 30% of major retailers will adopt an omnichannel digital B2B2C commerce platform, improving customer experience, process efficiency, and inventory management;
4. A surge in cybersecurity breaches will result in a 20% escalation of spending on managed services by 2018;
5. Retail mobile enablement will triple mobile investments in 2017 and double spending on wireless infrastructure through 2019;
6. Intelligent assistants will become a must-have app in 2017 and support shoppers' "jobs to be done" in context-aware omnichannel conversations by 2018;
7. By 2019, robotics and IoT technologies will increase in-store, in-warehouse, and in-distribution center productivity by 1.5x for early adopting retailers and by 3x for later adopters;
8. By 2019, 20% of major retailers will use augmented reality to enrich the product selection experience and convert shoppers to buyers three times faster
9. By 2018, retailers will pursue alternatives for secure networks that protect data and eliminate or lower fees; and
10. By 2019, artificial intelligence will change how 25% of merchants, marketers, planners and operators work, improving productivity by 30% and key performance indicators by 10–20%.
"Retailers must recognize and drive digital transformation,” said Leslie Hand, VP, IDC Retail Insights. “Retailers dealing with legacy, disconnected, and siloed systems have latencies and speeds that cannot support modern commerce, nor do most of the legacy systems allow retailers to quickly launch the types of services that customers today are expecting. At a time when customer expectations are rising and customers are more digitally fluent and digitally equipped than ever before, customers are expecting that their shopping experience will be easy, convenient, frictionless, and available anytime everywhere."
Hudson Yards retail component is 60% leased
After Neiman Marcus announced it would open its first New York store at Hudson Yards — the biggest development in that town in recent history — retail leases are being signed at a torrid pace.
According to developer Related Urban, The Shops & Restaurants at Hudson Yards are 60% leased more than two years before their scheduled opening in fall 2018.
“The west side of Manhattan is one of the most underserved retail communities in the city, and our aspiration is to assemble a collection of retailers and restaurants befitting the new neighborhood and the city,” said Kenneth A. Himmel, president and CEO of Related Urban, the mixed-use division of Related Companies.
More than 100 shops are destined for this million-sq.-ft., glass -walled retail center that will feature a public square and gardens plus a landscaped rooftop. Traffic is expected to be fed by the nearby High Line park and a stop on the newly extended No. 7 subway line.
Brands on board include Coach, Stuart Weitzman, Zara, H&M, Tory Burch, Kiehl’s, and Urban Decay. Nieman Marcus will inhabit a three-level space.
Furniture retailer to bolster shopping experience with virtual reality
Ashley Furniture is jumping into virtual and augmented reality to help shoppers visualize how furnishings can fit into a space more accurately.
The retailer is launching a company-wide virtual reality (VR) and augmented reality (AR) initiative that is designed to enable consumers to create interior layouts and experience living spaces in 3D. Ashley Furniture will create and scale its product catalogue for AR and VR, and publish new 3D product experiences, with a platform from augmented reality and virtual reality provider Marxent.
“Augmented and virtual reality are essential to our growth and vision for the future,” said Todd Wanek, Ashley Furniture’s president and CEO. “Our data shows that a combination of 3D visualization, seeing, touching and feeling actual products, combined with the consultation of our knowledgeable salespeople, will lead to a stand-apart customer experience that is location-flexible.”
The retailer’s first step will be to launch an AR shopping app, which will help shoppers see how home furnishings fit into an existing space. In-store virtual reality tech bars will combine a guided iPad-based space configuration experience with VR headset visualization, allowing shoppers to design and visualize their bedrooms, dining rooms or living rooms.
Ashley Furniture will announce which stores will be the first to launch the virtualization experience in 2017.