CES, NRF, innovation breakfast, customer experience, UX design, digital transformation, retail, ecommerce

CES and NRF: the Four Major Trends and Their Impact on E-Commerce

February 28, 2018

Article by Pieter Aarts, UX Strategy Consultant at Osudio

It’s not about technology, focus on what it means for the customer

The annual Consumer Electronics Show (CES) in Las Vegas is overwhelming. It covers 241,000 net square kilometer, has more than 180,000 attendees that come for 4,000 exhibiting companies. Finding relevance is the challenge.

That’s why Thomas Gayet and Benjamin Thomas from SQLI Innovation Labs gave a re-cap, combining with new insights gained at the National Retail Fair (NRF) in New York City. This blog focuses on the four major trends from CES and NRF, their implications for retail and e-commerce and our conclusion: UX (CX) is as important as ever.

From the perspective of retail and e-commerce, CES and NRF make an interesting double bill. We shared our insights with clients at one of our regular breakfast session at Osudio Amsterdam. We added extra food for thought: “what will be the next big thing in retail and e-commerce”?

Trend 1: Every Interaction Smarter, Personalized and More Relevant

“AI (Artificial Intelligence) is everywhere”, no doubt. Yes, it’s sometimes too much of a marketing hype (“AI inside this product”). But AI is here and is definitely here to stay. In every aspect of digital interactions, AI will play a role. The smarter and the more personal a service, provider or platform can perform, the more successful it will be. AI is doing that exactly: make interactions personal, actual and relevant. Regardless if it’s about personal health, finance, daily work or shopping: your personal needs and questions can be addressed more adequate and much better than before. AI guarantees that this effect increases every time you use an AI platform.

Adaptive and self-learning systems let you fulfill your tasks more efficient. It’s as simple as that. From that perspective, AI is beyond hardware and mostly about software. The challenge for the near future is the availability of very powerful processors - such as these from game developers NVDIA - who are able to make AI happen faster.

Trend 2: Mobility Will Never Be the Same

Another next big thing, is the digital transition in the automotive sector. The traditional car industry is teaming up with new partners in various fields. The “autonomous driving” car is almost a reality – at least on remote roads and motorways with controlled circulation – and newer forms of mobility are arising. The way we travel to and from work, make leisure trips or use a cab or rental car, will change radically. Your daily commuter drive alone in a car in a traffic jam won’t last forever. Instead, this journey will be filled with more interesting stuff such as checking e-mail, or have a chat with colleagues. It’s also clear that “be able to use a form of personalized mobility” will replace “owning your own car” or “hail a cab”.

New business- and value-systems are needed and created. No surprise that a vast amount of new coalitions between stakeholders and disciplines is taking shape, as well as the creation of new networks and ways of cooperation. An interesting topic is to determine who will be in the lead: the traditional global players and manufacturers (Ford, Renault, Nissan, VW, etc.), their recent challengers (Tesla, Google, Uber, Lyft, etc.) or complete new parties?

Trend 3: Order as You Wish (or Speak…)

Our own voice becomes a more essential part of user interfaces. SIRI already shaped the path for Apple users, who can interact easier, faster and far more intuitive with their iPhone or iPad. Last year, the use of Amazon’s Echo (Alexa) and Google’s Assistant have become increasingly popular in households throughout the USA. They’re not only voice-driven, but also offer relevant answers, products or services at the same time. Business wise this is a smart way to go: create a great user experience and integrate this in an ecosystem of e-commerce. On asking a question (“order me a pizza”) the system not only gives different options, but it also delivers your pepperoni pizza within the desired time.

As we speak, Apple’s Home Pod is currently being introduced in the USA. At this stage, Amazon is way ahead of the game with a 50% market share. Its Prime is a smart and open “eco (e-commerce) system” that’s already proving itself in being able to help the average user out. It will be interesting to see what will happen this year: will Amazon stay in the lead? What about Google, and is Apple capable to challenge these two? And what will Facebook’s new chat device bring to all of this?

Trend 4: Cameras Make Transactions Simpler, Faster and Easier

Last but not least: visual recognition is making big steps. It will ultimately lead to new systems and platforms which will make a lot of existing transactions simpler and faster. Forget that we as persons are now just used to (RFID) chips, passes or barcodes to identify ourselves. This will all change soon. On basis of your very own biometric specs it will be no problem to pass any security system (customs, airport, etc.) by simply watching into a camera.

The same goes for products: based on the physical specs of packages the check-out in a shop can be as easy as showing them to a camera. Managing and optimizing physical shops will change as well. Camera-generated “heat maps” identifies where and when customers will be present, making the planning of staff more efficient. If it’s crowded, you simple arrange the appropriate amount of staff. And scanning shelves and the interior with camera-robots delivers an adequate view of how they look like from a customer perspective, making sure you can maintain your P.O.S. environment in a perfect shape.

What Will These Trends Mean for My Shop, Retail-Chain or E-Commerce?

A lot of things are happening at the same time. And even if you’re able to define the most relevant trends in time, it’s still crucial to choose the right priorities. You can’t invest in all developments at once. SQLI’s Thomas Gayet and Benjamin Thomas have a strong opinion which three priorities matter most: AI, voice and seamless (invisible) check-outs. For AI, the focus should be on defining, creating and delivering far more relevant interactions and transactions. Besides technology, the research into your very own and unique users and customers is key. AI is only creating added value if the AI system or platform knows and remembers what will be relevant and what is not.

For voice, complete new scenarios and protocols are emerging. First, conversational UX (“how can we talk to each other and use spoken language as interface”) is the new discipline that needs to be taken care of. And – as Amazon already shows in an innovative way – just as important: if you are able to connect voice to new business, retail and distribution-models, you’re opening up an impressive world of opportunities. Last but not least: seamless checkouts will dramatically change our existing conventions about how a shop should look and work. Totally new concepts are already to be found in New York. There a comfortable place where you can work, eat, drink, lounge or meet. It just happens to be a shop as well. And accidentally, the product you’ve experienced can also be taken with you home. Thanks to visual recognition, there is no need anymore for a classic check-out.

Keep It Simple (Stupid): the Need for Continuous Iterations and UX

Observing this technology developing itself so rapidly, makes you wonder. Is there an end to what users and customers can (and will) handle? The way how we make these trends tangible in concepts, design, prototypes become even more crucial. Are we able to test AI, voice or seamless checkout in a real context with real users and gaining real feedback? And are we going to improve these concepts and designs with that? That’s, in a nutshell, exactly the core competence of UX: it helps to determine “what will happen and be successful the day after tomorrow” based on real insights.

New developments (like AI or voice) lead to new ways of interaction, thus creating new forms of added value. UX can contribute by making sure the added value is real and validated in the real world: such as develop and improve conversational UX (voice) or continuous iterations and improvements in self-learning platforms/systems (AI).

The three key challenges for retailers today are:

  1. Make sure you are up to speed regarding this way of learning;
  2. Be able to apply research and the new insights directly into the daily practice and business;
  3. Keep it as simple as possible.

Probably the best argument for a structural use of UX came from Levi’s president James Curleigh. He rightly stated during his keynote at NRF: “Success is about managing to offer customers simplicity in a complex world. Being simple is complex, but customers should not realize it.”

Contact us to find out what opportunities these trends can bring to your business.


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