Haggerston Times @ FashHack -The Retail Store Of The Future: Too Much Data, Or Not Enough?
An intoxicating, original blend of debate, forum, drinks party and speed networking, Fashhack is known for attracting the ambitious, curious, and forward-thinking of the startup world, searching for clues about the next big retail trend and looking to exchange tips & knowledge. We’re self-confessed addicts ourselves, and urge anyone with an interest in the future of fashion expressed in all its multi-faceted glory, to get onto the mailing list and get down to Farfetch HQ for the next instalment. For those who missed out this time, we’ve attempted a summary – we hope you enjoy (but there really is no substitute for attending, especially given the high quality networking opportunities)!
Does The (Digital) Fashion World Understand What The Consumer Wants?
The role that technology has to play in the future of the retail store is one of the most hotly debated topics on the high street. Technology is often blamed for the overall declining impact of the high street on retail sales, with customers, especially in the UK, increasingly opting for “clicks” over “bricks”.
It’s a misconception, according to Vishal Katelia, Head of Customer Strategy & Engagement at Farfetch’s specially created Store of the Future Task Force, and our panel host for the evening.
Until 2024, Vishal began by pointing out, research suggests that 75% or more of all retail sales will continue to be made in-store. Ecommerce, to put it another way, is not eating the world, nor feasting on the carcasses of once-bustling town centres, shopping arcades and out of town retail parks.
What isn’t in question is that technology; perhaps more than anything else; will decide whether or not the physical retail store of the future is an experience, that the public; you and I; will still want to have. But what is often misunderstood is the modern reality that you can’t have one without the other, in some combination or other. At one end of the retail / digital scale, Amazon needs its bricks and mortar delivery centres to stack ‘em high and sell ‘em cheap, whilst at the other, Burberry needs digital tags and QR codes in its Regent Street store to entertain its high-end clientele.
When it comes to the much-maligned high street, the in-store experience is paramount. Customer’s naturally love to touch, feel and experience fashion in its physical form, but they are also preoccupied with their personal tech which may be talking to them and telling them where to find the better bargains, and showing them alternatives in real-time to what is in front of their eyes.
But it can also work the other way; our personal preferences, expressed through our smartphone, wearable or stored data can be picked up and identified by the store or brand’s technology, which quickly teaches itself all about us and decides what the optimal way to sell to us might be.
What Are The Driving Factors Influencing The Future Of Retail?
Panel member Luke Timmins, a Retail Project Manager at Browns Fashion, believes the “big challenge” ahead involves “connecting the dots” or to put it another way, “how to bring global customers together. If I am abroad on holiday or a business trip and I visit a store, will they / it recognise me?”
Will the store of the future have the ability to remember names and faces? Would this spook us slightly? Or will we expect nothing less? Luke stressed the importance of the “360 approach”, underpinned by “consistency”. Like their human equivalents, will virtual sales assistants with a selective memory do more harm than good?
Viviane Paraschiv; an HR and change management specialist who has worked at brands including Ralph Lauren and Louis Vuitton; is well qualified to speak about the “sales assistant as brand ambassador”. They are “more than just runners”, they are the chosen ones; responsible for breaking down barriers with shoppers and achieving the “client engagement” so beloved of brands.
But are they irreplaceable? Again, it would be wrong to assume that “the robots are coming” for the shop floor assistants’ jobs. Again tech and humanity can coexist harmoniously; Viviane’s point is that tech can help to weed out the outstanding sales assistant, from the Mrs Slocombe’s Pussy’s.
David Ripert, ex-YouTube, now CEO and co-founder of Augmented Reality empowerment PaaS Poplar, and also London Chapter President of the AR/VR Association, the largest of this nascent industry’s trade bodies with more than 4,000 members, believes retailer are falling behind when it comes to adapting to the new Virtual “Reality”.
Trialling products virtually saves not just time but money, he believes. Speedo, a client he has worked closely with, is a case in point. The company sells garments, from trunks to goggles, that it would rather customers did not need to physically try on (unhygienic, and in the case of its goggles, which are heavily packaged, expensive both to try and return).
Data, he believes, can capture the customers retail DNA. It is “super-critical”, he observed, because it can measure, amongst other things, length of engagement, preferences, quirks, sizes, and spending power.
But can anybody, or any tech, keep pace with consumer preferences? As Vishal pointed out, each new customer arrives with a “bible” of information about themselves, expressed via Instagram stories, Snapchat cartoons and WhatsApp groups. Sales assistants trying to second guess consumers may find themselves not only outpaced, but red-faced.
Amanda Dyjecinski, a freelance marketing consultant who also invests in early stage digital tech alongside the Startup Funding Club, and has recently taken positions in premium outdoor leisure brand Findra, barefoot shoe brand Vivobarefoot, as well as mentoring at the Princes Trust, thinks data can help brands understand if shoppers “come with intent”, or “are looking for inspiration”. Let them shop, or help them shop? It’s an important distinction which, when interpreted correctly, can help shoppers “make a purchase in a better way.”
Luke Timmins sees a potential flaw in data capture’s digital armoury; limited technology creates a digital “echo-chamber”. Are machines capable of getting to grips with the psychology of sales – those nuances that, whilst obvious to a perceptive and experienced “brand ambassador”, are invisible to even the most granular of machine learning algorithms. Instead the tech too often tells the brand what it wants to hear. Shoppers defy assumptions – bad tech engenders digital death by a thousand inappropriate cuts, discounts, and misguided suggestions.
Panel member Jay Short, one of the founders of SolarFlare Studios, an agency which uses buzzy techologies like AR, VR and AI to create “beautiful stories and experiences that are in a league of their own”, is simultaneously positive about, and sceptical of, the power of digital and data.
3bn AR users by 2025 (he quotes the stat) represents something exceptionally powerful – but how to define it, and use it? WeChat, TikTok and SnapChat offer innovative and popular gender-swapping gamification possibilities, plus the ability to virtually touch-up selfies that can quickly morph into an opportunity to trial the latest cosmetic products being pushed by brands.
But, David Ripert believes, consumers are moving away from apps-within-apps; the onset of 5G enables customers to go direct from web to source, without the necessity to download and clog up their smartphones with apps they rarely return to once the novelty has worn off.
Jay Short describes a VR experiment which took place in a flagship Oxford Street store during London Fashion Week. A live feed from the catwalk that customers could join with a VR headset – but do the fashion conscious dig the headset? Jay believes that they often feel silly. When consumer empowerment is the name of the game, embarrassment is not a good look.
“People dislike digital friction”, Jay believes. Forget the Pokemon-style VR treasure hunt – customers prefer basic coupons they can touch and feel – and spend. Cheap and Cheerful beats Steep and Fearful every time, it seems.
But David takes issue; tech means fewer returns; more personalisation, which consumers like; data remembers size, taste. The day you abandon data capture, is the day you start to understand just how valuable data actually is.
Data As Opportunity
Data is not just about sales – it’s also about education. And it’s a two-way street. Amanda points out that today, hordes of eco-conscious consumers want to know where, and how, their clothing or accessories are sourced. The quickest way to do this happens to be paperless; win-win.
Data as Missed Opportunity
Why do people look but not buy? When does an email newsletter become spam? When is the right time to inform someone of a special offer? These are the types of literal million dollar questions that data analysts and techies ask themselves.
But, according to our panel, the chain of command is flawed. Head Office and digital pioneers operate out of ivory towers and echo chambers, when the reality on the high street is that their ideas and innovations are often poorly received, or simply ignored altogether.
Viviane has experienced this non-virtual reality. At Louis Vuitton, the excitement shown by store assistants during training with new tech gadgets that management and their tech gurus believe will be game-changing, rarely translated onto the shop floor.
Are 3 weeks of gadget training enough to alter the time-honoured traditions of the sales floor? How comfortable are brand ambassadors with change? Often, they don’t wear it well.
Jay agrees; sales floors are littered with redundant headsets and gadgets that do who-knows-what for goodness-knows-who. In one recent scenario, a pair of trainers were launched with so many digitally-enhanced smoke and mirrors effects that management forgot one thing – to make the trainers visible or accessible. Locked away in flashing boxes blaring music, sales assistants simply forgot how you were supposed to free the merchandise from its digital dungeon.
Jay calls them “tech-bullies”, ramming their wares down the throats of unwilling, unsuspecting shoppers. Was there anything wrong with fetching the shoes from the stock room without all the fanfare? To what extent does a shopper need to be subjected to the “wow-factor”?
How To Raise Money For Your Digital Innovation?
Nevertheless, whatever the occupants of the shop floor may think, the appetite for digital innovations remains almost insatiable. How can entrepreneurs take advantage?
By winning investment from business angels. Amanda outlined what’s currently hot in the digital dragons den. It starts with a real-life retail issue that needs solving. “I am looking for the idea that has the ability to grow to 10x its original value”, Amanda explained. “It doesn’t necessarily have to be super-innovative, just a better version of something that already works – slightly better is absolutely fine!”
Another vote for incremental, granular, digital baby-steps over the “shock-and-awe” tactics of the money-no-object, Golden Square brigade, too busy re-inventing the wheel to evaluate the impact of their fragile creations, perhaps.
Consider the product market fit. Evaluate the real-life impact. Measure the cost benefit. You don’t need an app for that, just an abacus. The corollary to that, of course, is that often investor appetite is for the Next Big Thing. Not all investors are smart.
Evaluate whether your product or service advance the cause of AI, AR, VR or ML, Amanda continues? Can it be done more cheaply without recourse to these nebulous acronyms? Can we observe the sales assistant at work, and simply copy and augment what they do, using datasets, real-time feedback, personalisation, and other aids – the kind that shop floor staff actually want?
Art vs Science vs Economies of Scale
Another thread to examine. Some Brands derive value from defying geekdom; fashion is not painting by numbers, it’s flagrant creativity, devil-may-care extravagance, and budget busting boutiques. If you are selling Fendi, Burberry, or Dolce and Gabana 1-1 in a glamorous Milan side-street, best to leave the tablet at home. Customers aren’t buying it.
On the flipside, how can one store assistant cater to one-hundred shoppers in Primark on Oxford Street? Headsets, tablets, and walkie-talkies are the order of the day here.
Conclusion – What Will We See On The High Street In 5-10 Years Time?
According to Luke Timmins, we will see versions of the flagship Nike store in New York City. If I want to click and collect, I can. If I want to be wowed, I can be. I don’t want to queue and I don’t want to wait – I want the sales-assistants, be they virtual or physical, to know this.
Viviane expects stores to be able to understand that “sometimes I’m rushing and other times I’m chilled”, and have the wisdom to tell the difference.
David feels differently. The store of the future will be in your home, worn on your body or, quite literally, embedded into your brain. Think Google Lens, smart mirrors, and virtual mannequins.
Jay believes the question is too broad. Maybe, just maybe, stores will abandon tech altogether – retro has always been a popular, populist branch of fashion. Feel Real, Feel Valued, is a persuasive call to arms for the Extinction Rebellion generation.
Vishal suggested that the democratisation of technology results in a loss of appeal. If everyone has access to it, it’s not luxury anymore.
In the final recknoing, at some point, we all wear the fashion we buy. Does tech merely prolong the inevitable. Death, taxes, and fitting rooms – there is simply no getting away from them.
Naturally, the audience had plenty to say. One that jumped out was a question from Basil, a grizzled industry veteran.
“What happens if my personal tastes change”?
It’s a great question. Past performance is no indication of future performance; one day I am out shopping for high end goods for my wife’s birthday, the next I am buying school shoes for my 3 children. Entirely different scenarios with different aims, different budgets, and requiring a different approach.
Picture the scene; 3 screaming kids, and the sales assistant is trying to show you the Hublot watches. Doubtless there are countless more examples where the data collected is wildly unrepresentative of the real person. The panel agreed that this was a tough nut that remains uncracked.
However hard tech tries to spy on what we do, whether its Amazon Alexa, or that dating app we stopped using 3 years ago that quietly collects data as we carry on with our lives, oblivious to its existence.
The thing about tech, is that it can be kind of tacky. The thing about fashion, is that it desperately wants to avoid the same fate. Clearly, there is work to be done. Perhaps it will begin, as one audience member suggested, with audio. Would you object to a store assistant interrupting your favourite song, sending news about 10% off earthenware for the next 2 hours only wafting through your air pods?
I kind of like it, but that’s just my personal taste. Wonder if anybody, or anything, really knows exactly what I want.