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10 Disruptive Digital Retail Trends on the Horizon for 2016

Retail has been turned on its head in recent years, and 2016 will be no different. The new year will bring more melding of channels and greater catering to experience-seeking consumers.

According to Oliver Guy, a retail industry director for digital business platform Software AG, which just released its 10 disruptive digital trend predictions for retail in 2016, “The worlds of e-commerce and brick and mortar retail are now seamlessly merging with retailers evolving towards an omnichannel approach to their businesses.

Further, he added, “Mobile, cloud, analytics and social media will be fully integrated into a unified merchandising system designed to vastly improve customer engagement. The notion that ‘the store is dead’ is not, in our opinion, the future – rather, stores will become highly technology-enabled to deliver a super-personalized customer experience and become the hub of omnichannel customer-centricity. These new predictions highlight our view of the retail industry in the coming year.”

Here are the 10 digital trends retailers should look out for in 2016:

Fewer stores, more stuff

Brick-and-mortar stores will add fewer locations, instead opting to reinvent themselves to address the omnichannel shopper.

“Existing stores will take a ‘hub and spoke’ approach, acting as pick up and fulfillment centers and offering ‘gold-star’ customer service,” Software AG said. “The ‘endless aisle’ concept will extend shelf space to the brand’s full catalogue of products and accessible content.”

It’s all about you

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Customer-centric personalization will be the key differentiator for retailers and these offerings will become even more targeted. Technologies like RFID-loyalty cards that can send tailored rewards to mobile phones will support the effort.

“They [retailers] will tap into internal information, known preferences, and social media data to better understand and delight their customers.”

The price is right

As competition increases in the saturated retail market, differentiation by price will be more dynamic as consumers grow keener and increasingly price sensitive.

“Real-time electronic shelf pricing will replicate customers’ online experiences, as well as optimize inventories and reduce labor costs. Real-time personalized discounts and special offers will further motivate shoppers to head to stores,” according to Software AG.

Mission control for “omni-everything”

Today’s want-what-they-want consumers expect to get whatever that is wherever and however they want it, and only an omnichannel offering can provide consistent cross-channel experiences.

“The complexity of omnichannel processes and how these interact with multiple systems will need further control; a kind of ‘mission control’ center where retailers can see and control every activity across all channels.”

You will meet a tall dark stranger

Predictive analytics will be retailers’ greatest tool for telling what consumers want and when they want it.

According to Software AG, “Predictive analytics tools, especially when combined with streaming analytics, offer retailers the ability to manage queues, customer expectations and inventories before there is an issue.”

The Internet of total satisfaction

The Internet of Things (IoT) and sensor-oriented devices will revolutionize the store of the future and enable the necessary targeted consumer centricity.

“Retailers embracing IoT will have visibility into inventories via electronic shelf sensors; the ability to create smart signs that are weather- or facial expression-relevant; and the tools to make every loyalty customer feel coddled and important.”

Immersion therapy

Shoppers want a unique in-store experience and futuristic, immersive technologies will provide them with just that.

Microsoft’s Hololens, for example, lets customers try on clothes or design their own kitchens virtually while in store and they’ll be able to share their experiences with influencers like friends and family. iBeacons and analytical face detection will allow retailers to interact with real-time consumers and track their behavior.

Clean-up on aisle one

“Real-time monitoring capability will be critical for the store of the future, in order to sense, correlate and automate processes from staffing to inventory,” Software AG said.

Smart sensors will provide visibility across stores and detect activity, allowing retailers to respond quickly to things from aisle spills in a grocery store to low stock on umbrellas during a storm.

Buy me now!

Retailers will tap into buy buttons in a bigger way in the hopes of fueling higher earnings. “But,” Software AG explained, “They will need to make strategic technology investments to ensure real-time inventory is understood and the complex processes involved in new channels are orchestrated correctly.”

Last item in stock

With consumer demand the way it is, real-time inventory visibility will be vital for retailers to keep customers happy and informed of stock at all time.

“Retailers will control inventories by applying technology that shows inventory levels across all channels,” Software AG said.