Hello, Happy New Year, and welcome to 2021—a year that will forever be known as “The year after 2020.”

On today’s episode, we’ll hear from thought leaders including three of our retailer friends, an Automotive executive, and three retail technology experts about their vision for 2021.

Today’s guests include John Boline from Starbucks, TheRealReal’s Courtney Hawkins, Wolfgang Hoffmann from Jaguar Land Rover Canada, and Dan Goldman, who recently joined Gap after a noteworthy stint at The North Face.

We’ll also hear from innovative retail solution providers, such as AiFi, a company that’s turning physical stores into checkout-free experiences; Level10, a company that helps retailers do more with fewer partners by procuring, deploying and maintaining IT equipment; and Zebra Technologies, a software analytics provider that helps to empower the front line in retail and e-commerce.

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Hosted by Julia Raymond Hare; Written and produced by Gabriella Bock; Edited by Trenton Waller; Social media by Natalie Arana

 

TRANSCRIPTION

Courtney Hawkins:

I’m excited to talk about 2021. Here are my predictions for what I think the future of retail will be in the new year. First, I think the first few months are going to continue to be more of the same from 2020, but as the pandemic starts to curb with the vaccine, I think we’ll enter a new normal that blends consumer behaviors prior to the pandemic, and also consumer behaviors during the pandemic.

 

Courtney Hawkins:

I think about this in three categories, product, customer, and experience. So for product, I think work from home will continue to live on, but days in the office will slowly come back, as will small social gatherings, schools, et cetera. I think this will shift the apparel category performance to the casual and more traditional gathering styles, like denim woven dresses. Casual will be here to stay for a while, but the buying behavior will shift into these other categories.

 

Courtney Hawkins:

Customers. Customers will want to continue to shop with convenience, whether that’s shipped, BOPUS, curbside, or reserve in store. After this holiday season, I think returns will be the friction point retailers will need to solve for both internal operations, and the customer experience. Customers will continue to look for retailers that reflect their values and will continue to aid where they shop.

 

Courtney Hawkins:

Experience. As we become more comfortable going out, store experience will need to continue to evolve. Customers’ tolerance of pre-pandemic experienced behaviors in stores, such as waiting in lines or messy stores, I think will be a permanent deal-breaker for consumers. While seeing an increase in foot traffic to stores will be welcomed by retailers, now is the time for them to reimagine a new, better experience that will allow for speed, safety, a sense of escapism and normalcy of a shopping journey.

 

Courtney Hawkins:

I’m excited to see progress in curbing a pandemic will do for the retail business and overall communities, families, and society.

 

Alex Sophocleous:

Hi, I’m Alex Sophocleous. I’m the head of marketing and partnerships at AiFi, where we transform stores into checkout-free autonomous experiences for retailers around the world. As we move into 2021, I believe there are three trends that will define success for retailers. 

 

Alex Sophocleous:

First, retailers should place increased importance on omnichannel strategies, where they focus on fulfillment for buy online, pick up in store. Whether this is electronics or groceries, the experiences that retailers adopt will revitalize physical stores and allow them to take advantage of their proximity to local customers.

 

Alex Sophocleous:

Secondly, implementing safe-shopping experiences and contactless checkout options will remain essential to ensure customers aren’t shifting buying habits away from your stores. It will take time until customers feel comfortable again, and retailers shouldn’t try to rush this. 

 

Alex Sophocleous:

Lastly, there have been so many technology advancements this year to support everything from easier checkouts and improved shopping experiences to inventory management and store analytics. As such, retailers that embrace or at least experiment with these technologies will thrive because of their advantage to deliver on customer expectations and improved operational efficiency.

 

Alex Sophocleous:

One common trait across these trends is an increased need for a frictionless customer experience, especially for brick and mortar. At Ai-Fi we can support this by converting stores of any size, into a contactless, autonomous shopping experience. By allowing AI to manage the checkout process. We remove the friction of waiting in lines. So customers can quickly grab groceries, and carry on with their day. Also, retailers can choose to implement a cashier checkout and autonomous shopping hybrid solution. So customers have the option to continue their normal shopping habits, or enjoy a faster shopping experience with Eye-Fi when they’re ready to make the change.

 

John Boline:

Hey folks, John Boline here with Starbucks.

 

John Boline:

What will define success in 2021? Brands with a clearly defined and effortless digital strategy that deliver on multi-channel deliverables to reach customers where they are at. Digital has become table stakes, are really a requirement for survival in retailers in food and beverage. But I have to say those that continue to win will find success in their experience add factor. We’ve already seen a shift from routinized customer occasions to those seeking a reward or an out-of-home experience to enjoy products and services in a safe and familiar way.

 

John Boline:

As the vaccine rolls out you will see this happening in an even more accelerated fashion where folks are looking for brands to uplift and give them that safe and out of quarantine experience that they’ve been craving for the past several months. Those that deliver on that will continue to win.

 

John Boline:

Wishing you all the best in 2021, let’s make it a great year and get out of this quarantine.

 

Mark Delaney:

It’s Mark Delaney with Zebra Technologies. Here at Zebra, we enable our customers across a number of verticals, with retail being our largest one, to deliver better experiences leveraging technology.

 

Mark Delaney:

One of the key trends or focus areas that I see driving success in 2021, is actually one that we’ve grappled with for a long time and that is inventory visibility. COVID and the resulting spike in e-commerce has put enormous strain on supply chains across the world. Our most recent Global Shopper Study revealed that well over 80% of retail decision makers, and that is senior managers and C-suite executives at our retailer customers, agree that visibility to out-of-stocks is still a significant challenge. In that same study, 83% of those same decision makers called out workforce management applications with being critically important over the next five years, with prescriptive analytics and also automation being called out as well. These growing retail technologies are actually driving much of the solution journey that we are on at Zebra right now with our customers.

 

Mark Delaney:

Certainly, the other topic dominating conversations right now is click and collect, also known as BOPIS, buy online, pick up in store. Curbside experience is the hot area of investment right now given the pandemic. Not only will this have sticking power long beyond COVID, but it also requires a huge amount of orchestration behind the scenes to be done properly.

 

Mark Delaney:

The other area that we’re investing a lot of time speaking with customers about is automation. Now, whether that comes in the form of robots addressing various use cases or related areas, such as micro-fulfillment centers that are being put up at a number of retailer customers, at Zebra, we have internally developed robotic solutions, such as SmartSight, as well as strategic ventures investments that we can leverage with our customers to help them drive further operational efficiencies at retail.

 

Mark Delaney:

Now, when Amazon started their huge growth trajectory a number of years ago, we all wondered what a world before Amazon Prime looked like. Well, now COVID has become the largest, or latest, industry-changing event, but as Einstein said, “In the midst of every crisis, lies great opportunity.” So an exciting time to be in the retail industry for sure. Thanks for listening, enjoy the rest of your week.

 

John Pruban:

Hello, my name is John Pruban, and I am the president of Level 10. For those of you who don’t know what Level 10 is, Level 10 acts as an extension of retailer’s IT teams to help them deploy technology, whether it’s as a new technology deployment or as part of the support of a retail store opening, closure, or remodel, we do all the services associated with that, including installation, staging configuration. We also help retailers manage the repair and maintenance of that technology once it’s deployed and help them with help desk solutions

 

John Pruban:

We believe at Level 10 that the technology trends will be the deployment of technology itself. We have seen already in the eight months of COVID a huge explosion of the deployment of technology, whether it be buying online, pickup in-store, curbside service. Same-day delivery is obviously huge.

 

John Pruban:

The drive-through technologies that retailers are putting in, ship from store to homes, self-checkouts, kiosks. And so the deployment of these technologies will continue to challenge retailers to deploy them as rapidly as possible, to do it in as agile a format as possible, and to make sure their back systems can support it, whether it be a wifi… There are phone systems that will take calls from different parts of the enterprise, the software upgrades that’ll be necessary to support a lot of this technology and, of course, the hardware to run it as well. So these are some of the technology trends that we’ve already seen and that we imagine that we will continue to see well into 2021, since the way the retailers are interacting with their customers has forever changed.

 

John Pruban:

The second part we’ll see is the retailers managing the operationalization of their safety within their stores. Whether it be cleaning products, covers, retailers need to make their customers feel safe. And retailers, while they did this temporarily back in April, May and June now have to do it permanently, and retailers are working to make sure that safety’s not only a part of their culture and their everyday behavior, but also the products and services needed to support it as part of their supply chain as well.

 

John Pruban:

And the last part, of course, is agility. Retailers have to deploy these technologies very rapidly. Most of them are cloud-based, many times with new vendors who are not used to the space. So retailers who have been embracing agile methodologies going into this are better off, but certainly new ones will need to be there. As far as what solutions retailers can implement to create a frictionless customer experience, it’s really agility itself. They need to make sure they’re agile internally, but most importantly, I would say in working with vendors who are able to have business methodologies and models to support the deployment of their technologies as rapidly as possible.

 

John Pruban:

So, those are some of the key technology trends that we see in 2021.

 

Julia Raymond Hare: 

That was John Pruban, president of Level 10. 

 

Up next we switch gears ever so slightly to glean perspective from the mobility sector. As we know, retail partners are fundamental for players in this space and impact how we buy vehicles. I had the opportunity to speak with Wolfgang Hoffmann, the President at Jaguar Land Rover Canada, about his vision for the future. Considering the announcement made recently by Volvo to double its global online sales volume to 50% by 2025, I began by asking Wolfgang’s thoughts on consumers buying cars online. Here’s what he had to say: 

 

Wolfgang Hoffmann:

It must be realistic for them maybe. Otherwise, they wouldn’t make an announcement like that. I, I personally don’t believe that it’s true for the total industry. I think that’s maybe a lofty target. I mean, will you see a shift towards more, more online business? Definitely. And you see that a lot of common effectors are singling out specific either models or, or powertrains. You saw it with other European manufacturers where they do it now, I think in Europe with the electric suffocation or electrified models. So that, that might be a testing ground for some of them, but definitely the industry is evolving, but I don’t think anyone knows right now where it is completely going. And from my perspective, I can only say that the retail partner will always be a fundamental element of the distribution channels. A car is too big of an investment. It’s too complex. It’s very emotional and it’s very, you know, satisfying when you buy a new car. II don’t think anyone ever forgets the first new vehicle that they bought. And the only way you can do that, I believe is still in a, in a one-to-one person to person interaction. 

 

Wolfgang Hoffmann:

Yes, of course, a lot of people are buying now watches online and phone, but if you go to the, to the higher end of the market, that’s when the trust comes in, when you want to know who’s selling it and where has the watch been? And do you want to have the reassurance? If something goes wrong here, I can go to John and he will take care of me. And I think that element will be even more important in the future convenience, helping people, helping customers and just taking some burden away from them in their day-to-day lives. That’s why we have texts consultants and things like that. I think everyone is capable of doing the Texas themselves, but it’s getting so cumbersome and so long winded. And you have to read so much that at one point, you just throw up your hands in here and you say, no, I have someone who specializes and helps me with that and makes my life easier. I think that thinking has to also be more entrenched in our industry. We have to see ourselves as, as problem solvers, as people who make people’s life more convenient and easier. 

 

Wolfgang Hoffmann:

What we don’t know now is all of the services that will be provided to customers going forward purely due to the fact as well that you spend such a lot of time in your car. So if your car is not connected to everything else in your life, then you’re, you’re missing out so to speak. And if you spin it, then further one, one day we will have autonomous driving to a very significant extent. 

 

Wolfgang Hoffmann:

The industry is in a complete transformation process and everybody acknowledges that it’s really just the speed and, and some things take time. It’s the same with autonomous driving or connected vehicles or electrification. You know, we, we, what do we sell? We sell probably not 10%, not even 10% of the total car park every year. So the industry can’t evolve overnight and it’s just physically impossible because you have so many other participants on the road as well. And you have to make sure that everyone is safe, but there will be a time and beat in, in, in 15, 20 years or so. Yeah. We’re cast really communicate with each other where exit, and hopefully our listing of the past, because you know, your car and communicates with everyone around. And, and if everyone knows the direction and the speed of each and every participant on the road, I mean, it is mathematically very easy to predict and then to avoid. And I think that will come, but It’s not happening overnight.

 

Wolfgang Hoffmann:

 When I was a kid, my father was filling up the car. I mean, it was, it was let in into gasoline. I mean, how things have changed now, how engine engineers have made it possible that you don’t need that additive anymore. So your, your engine was safe and coming down in emission so dramatically, despite the fact that cost got heavier and heavier because of all the safety features. And look at electrification now, it’s just, just awesome to see how things change. And that will not be the end. There will be a smaller generation who will take that even to the next level. And, and we’ll make sure that we all take care of what, what we also really love and that’s the people and the environment. 

 

Julia Raymond Hare:

Very true, indeed. Before I share some of my predictions, we’ll hear from Dan Goldman.  

 

Dan Goldman:

Hi, my name is Dan Goldman. I’m Vice President of Strategy and Business Development at Gap Inc. You know, this time last year, no one could have predicted the year we’ve had in 2020 or the profound impact COVID has had on the retail industry. Well, I’d like to predict that 2021 will be a return to normal. I actually believe the new normal is there is no normal. 2021 will continue to be a year that requires agility to adapt.

 

Dan Goldman:

Now the good news is unlike last year, when retailers were caught off guard and had to react defensively to COVID, heading into 2021, retailers should benefit from the fact that they have had a year to plan and build. The bad news is not all retailers will be able to do this successfully, and as a result, we can expect that the bifurcation between the winners and losers continues to accelerate. The winners will continue to innovate how they engage and build meaningful relationships with consumers.

 

Dan Goldman:

First, digitally, especially in the front half of the year. I think we’ll see some very interesting engagement models and digital capabilities come to life that build on the best of what we’ve seen from the last year. If the past year has been establishing a foundation for digital engagement, omnichannel capabilities, social, and whatnot. I’d expect over the next year, these executions get more refined, more profound, and retailers also add a deeper layer of personalization to them. I also think that social commerce models will continue to scale.

 

Dan Goldman:

Second, especially in the back half when hopefully the pandemic is more behind us, I also think that winning retailers will find ways to bring the physical store and brand experiences to life in a way that are super engaging and help really reinvigorate consumer’s interest in shopping in person. They’ll need to entice consumers back and make them really appreciate why physical brand engagement is so powerful.

 

Dan Goldman:

Third, across both channels, I also think there’s a huge pent up consumer demand for community and belonging. I think the retailers that can tap into this and bring people together, whether virtually or in-person, will stand out in consumers’ hearts and minds.

 

Dan Goldman:

Regardless of which of these predictions become true, let’s hope that 2021 is a healthier and happier year for everyone.

 

Julia Raymond Hare:

A healthier and happier year for everyone—I think that’s a great place to begin wrapping up, but, before I sign off, as I did last year I’d like to share with you my 3 predictions for retail trends.

 

First, I think we can all agree that 2020 was one the most intense, distinct and downright bizarre years of our lives. But with all of its craziness, it’s also been a changemaker. It lit the fuse on groundbreaking transformation efforts spanning industries. 

 

As we all do an internal reset and hit the ground running, I feel so much gratitude. 

 

Though staying home hasn’t been easy, there’s no denying that the retail industry has made purchasing goods, gifts, and groceries easier and more efficient than ever. In many ways, life has never been more convenient.

 

And I know the elephant in the room is ecommerce. Retail ecommerce jumped to record highs of reportedly 36% globally during the height of the pandemic (source). With that in mind, I’d like to recap a few figures: 

 

  • In 2019, online shopping represented 14.1% of retail sales worldwide (source).
  • Then in 2020, retail e-commerce amounted to $3.9 trillion, or 17% of global retail sales, excluding food and delivery services, according to the firm GroupM.
  • By 2024, that 17% is expected to reach up to 25% of retail sales. (source) In other words, in a few years it’s possible that, on average, 1 in 4 global retail sales will take place online  

 

Still, we’re left with physical stores accounting for the majority of sales. With that said, I have 3 predictions for brick-and-mortar trends this year. These trends are based on two overarching drivers: convenience and safety. 

 

The demand for convenience has been steadily increasing in parallel with all things digital since the birth of online commerce. When the pandemic hit, everyone was blindsided and suddenly, the desire for convenience reached all time highs. Why? Because convenience was, and will continue to be, tied to the other driver: safety. A heightened focus on safety has reflected in consumer behavior as our shopping activities shifted away from discovery and almost fully towards intent-based purchasing. For retailers, BOPIS, curbside pickup and “ship from store” options went from a nice to have to a service critical for survival. Amazingly, many retailers rolled out these solutions at a mind-blowing pace last year. 

 

With convenience and safety in mind, the top 3 trends that I predict will shape brick-and-mortar in 2021 include: 

 

  1. Dedicated shared spaces (not pop ups): When I was predicting 2020 retail trends, “unexpected partnerships” was at the top of my list. And it’s come true with too many examples to name, many out of necessity. Most recently, I think of Sephora’s partnership with Instacart and then with Kohl’s following Target’s partnership announcement with ULTA beauty. These partnerships signal a move away from the “pop up” trend and towards dedicated shared spaces that create synergies among the retailers and convenience for consumers. 

 

  1. Health and wellness retail: Retail operators will have the opportunity for redevelopment, especially as big department stores continue facing challenges and bankruptcies and, in turn, lose some of their historical influence over operations. This redevelopment will be driven by the rise of consumer demand for health and wellness products and services, including cannabis retail, as health became more of a focus in 2020. Without as much travel, open-air markets will need to cater to locals and nearby visitors looking for a bit of entertainment. We’ll again see the importance of great food and immersive environments that offer a sense of discovery through unique retail concepts.  

 

  1. Contactless Connected Stores: “I immediately think of a sentiment shared by Shannon Ryan, the EVP North America for Valtech, in our connected experiences luxury episode, where he eloquently said, and I’m summarizing a bit here, “historically it used to always be about how you could interact with the store, and now we’ve sort of turned that around a little bit and the store interacts with you.”

 

People will increasingly want to use their phone as the controller across touchpoints such as interactive displays, curbside or in-store pickup or checkout, etc. This capability provides a safer and contactless experience that people can feel good about when shopping in our new normal. 

 

 

 I want to thank all of our guests who joined us today. I hope all their predictions come true as we embark on a brand new year. 

 

We’ll be back next week with our regular format as we explore what’s new in retail news. Have a great week – and welcome to 2021. 

 

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