trends 2017: retail opportunity for the fast changing world and the human mind

Trends2017:RetailOpportunityfortheFastChangingWorldand

theHumanMind

KATEANCKETILL,CEOandFounder,GDRCreaIveIntelligence

GDR CREATIVEINTELLIGENCE

@gdruk [email protected]

GDR is a retail trends consultancy, delivering the information that

unlocks and empowers innovation.



You’re probably not going to like what I’m going to say.

(Please don’t shoot the messenger).



1. The Big PictureThe fourth industrial revolution: get used to exponential change

2. Consumer ExpectationsExperiences in one sector set expectations in all others

3. How you must adaptBeing forewarned is the first step…



The Fourth Industrial RevolutionThe information revolution.

The fusion of physical, digital and biological technologies, each advancing at an exponential rate.



What were the other revolutions?

Steam and mechanisation

1760-1840 1875-1925 1960-2000 2010- Electricity and

mass productionDigital and the internet

The fusion of physical and digital



The Fourth Industrial Revolution“How do we understand and shape the new technological revolution, which entails nothing less than a transformation of humankind?”

Klaus Schwab, Founder, World Economic Forum



The Fourth Industrial Revolutionof US jobs are at risk due to automation within the next 20 years

Osborne & Frey, Oxford University

47%


• 50 years of Moore’s law • AI in the cloud • Exponential machine

learning • AI core to business models

Why now?


What does this mean for retail?

GDR CREATIVEINTELLIGENCE Robots replacing workers

Location: Amsterdam Schipol Airport

Spencer scans boarding passes and guides passengers between departure gates for KLM. Tested March 2016.

GDR CREATIVEINTELLIGENCE Associate-free stores

Location: Seattle, USA Checkout-free shopping uses the same types of tech used in self-driving cars: computer vision, sensor fusion, and deep learning.

GDR CREATIVEINTELLIGENCE Associate-free stores

Location: Seattle, USA Checkout-free shopping uses the same types of tech used in self-driving cars: computer vision, sensor fusion, and deep learning.

•

• 3.5m people employed in the US as cashiers in 2015

• The British Retail Consortium forecasts 1/3 of retail jobs will disappear by 2025 due to automation and the increasing minimum wage

GDR CREATIVEINTELLIGENCE Self-driving vehicles

Location: USA Since October 2016, Tesla cars have had full self-driving capability at a safety level “substantially greater” than that of a human driver.

GDR CREATIVEINTELLIGENCE Self-driving vehicles

Location: USA Since October 2016, Tesla cars have had full self-driving capability at a safety level “substantially greater” than that of a human driver.

•

“If I had to guess at what our biggest existential threat is, it’s artificial intelligence.”

Elon Musk



Technological unemployment.

or

Radical abundance supplied by super-intelligent machines.

GDR CREATIVEINTELLIGENCE Political and societal upheaval

Location: Switzerland, June 2016

Swiss referendum for a universal basic monthly income of $2,555 rejected by 77% - but got the issue discussed.



There is a big upside…

if you’re the disruptor.


DISTRIBUTED SYSTEMS

MACHINE LEARNING

CONVERSATIONAL INTERFACES

ADAPTABLE MECHANISMS

THE DIGITISED POPULATION

DEVICE - DEVICE NETWORKS

PERVASIVE CONNECTIVITY

SMART SENSORS

ADDITIVE MANUFACTURE


MACHINE LEARNING


DISTRIBUTED SYSTEMS

New forms of interaction and service

GDR CREATIVEINTELLIGENCE Google Home

“By 2020, 30% of web browsing sessions will be done without a screen.

By the end of 2017, room-based screenless devices should be in more than 10 million homes.”

GDR CREATIVEINTELLIGENCE Ubtech’s Alpha2 (Lynx) Robot

Location: China Domestic robot now integrated with Amazon Alexa.

GDR CREATIVEINTELLIGENCE KFC x Baidu

Location: Shanghai, China KFC hosts Baidu’s voice-activated robot Duer, which takes customer orders and payment through speech.

GDR CREATIVEINTELLIGENCE IntelligentX

Location: UK Design: 10x

Craft beer uses customer feedback via a Facebook Messenger chatbot to create next batch.

SMART SENSORS




Adaptable service delivery and manufacture

GDR CREATIVEINTELLIGENCE Starship autonomous delivery robots

Location: Global Design: Starship Technologies

Self-driving delivery robots deliver two bags of shopping at 4mph within a three mile radius

GDR CREATIVEINTELLIGENCE Zume Pizza

Location: US Delivery service uses robots to make and bake pizzas. The truck houses 56 ovens that schedule the cooking to the delivery time.

GDR CREATIVEINTELLIGENCE AlpStories

Location: Zagreb, Croatia Design: Brigada, Yaskawa Corporation

Slovenian cosmetics brand has two product ranges: ‘Our Story’ and ‘Your Story.’ ‘Your Story’ products are created by the consumer and made in-store while they wait – by a robot.

GDR CREATIVEINTELLIGENCE Unmade x Opening Ceremony

Location: London Knitwear brand lets customers personalise their purchase by choosing the pattern and colour, and adding monograms.

GDR CREATIVEINTELLIGENCE Au Pont Rouge

Location: St Petersburg, Russia Exhibition retail space designed around a robotic system within a restoration of an iconic 110-year-old department store.


Personalisation and autonomous activity




GDR CREATIVEINTELLIGENCE ICA grocery delivery

Location: Sweden Smart locks let supermarket staff deliver directly into homes, so they can put food straight into the fridge.


DISTRIBUTED SYSTEMS

MACHINE LEARNING






SMART SENSORS


New forms of interaction and service

Adaptable service delivery and manufacture

Personalisation and autonomous activity

Speak my Language

Reflect my life

Serve me 24/7



2. Consumer Expectations

• Speak my language • Simplify my life • Serve me 24/7 These demands can only be met by enhancing services with new technology.

GDR CREATIVEINTELLIGENCE Petrovich

Location: St Petersburg, Russia DIY store uses appropriate fulfilment methods for each purchases, merging online and showroom experiences.

GDR CREATIVEINTELLIGENCE TokyWoky

Location: Global Live peer-to-peer chat, resulting in a conversion rate 4-6 times higher than from non-users. 10,000 questions answered monthly.

INTE

RN

ATIONAL CUSTOM

S

Transparent PricingWe believe customers have the right

to know what their products cost to make.

MATERIALS$27.83

TRUE COST$45

$130 $225

TRADITIONAL RETAIL EVERLANE

HARDWARE$1.60

LABOR$13.69

DUTIES$1.72

TRANSPORT$.60

GDR CREATIVEINTELLIGENCE Everlane transparent pricing

Location: USA Online clothing brand states garment pricing breakdown and margins, comparing their goods with conventional retail brands.

GDR CREATIVEINTELLIGENCE Back Me Up app

Location: UK 17 to 49-year-olds insure up to three items by uploading a photo to the app on a pay-as-you-go basis: for just $19.45 per month.

GDR CREATIVEINTELLIGENCE Battersea’s Looking For You

Location: London, UK Design: Ogilvy & Mather UK

Billboard interacts with dog lovers - stray dog follows passers-by to give emotional adoption message.

GDR CREATIVEINTELLIGENCE Scentbird

Location: US Monthly 8ml bottles of leading branded perfumes for a $14.95 subscription. 450 scents available, including Tom Ford and D&G.

GDR CREATIVEINTELLIGENCE Martini Smart Cube

Location: UK Design: AMV BBDO

Digital ice cube uses beacons to connect the glass to the bartender’s app, automatically reordering another Martini.



3. How you must adapt:

Embrace AI and get in front. Plan for a reduced workforce, anticipate further erosion of the middle class

Automation: when, not if




Ethical transparency, individualised products and services, full visibility of the supply chain, 24/7 seamless availability

Consumer expectations




Service will require enhanced employees, using nuanced emotional intelligence

Unleash service ‘centaurs’



Questions discussed at GDR’s NRF Salons

• Can we really have one-to-one connections with everyone?

• What does this mean for the look and feel of retail space?

• How does this impact service and the model by which we recruit and train staff?

• Does the customer always know what they want? • How do we make chatbots work? • Isn’t low tech customer awareness just as important?

An Introduction to GDR


GDR Creative Intelligence Dilke House, 1 Malet Street, London WC1E 7J Tel: +44 207 580 5589

Kate Ancketill, CEO and Founder

[email protected]


We want to help you form more meaningful relationships with your customers in a rapidly

changing and competitive world.


How do we do this? We are a strategic partner that helps turn your insights into meaningful action for your customers.

Innovation research: we watch big and small companies, in your sector and outside of it, all over the world; and we investigate how they innovate. We hear it first from the creative agencies behind the most innovative concepts, who help us understand the insights behind the ideas.

Strategic consultation: we learn from the best (and worst) innovators and we apply those lessons to your strategic priorities.


GDR has a client base that covers many categories, mass-market and luxury tiers and global geographies. This informs and inspires our wide perspective.


What makes us different?

We look at innovation first - those responding to existing and emerging needs - rather than consumer research. We don’t try and make the world fit our view.

We help you develop the ideas that make a difference to your customers.

We’re not a qual/quant research agency, and we don’t execute; we impartially connect you to the agencies who can deliver for you.


We want to make you feel…

Confident that you know how to grow and develop your business, and crucially, your customer relationships.

Reassured that you’re focussed on the change that is important, and you can dismiss the change that isn’t.

Full of amazing ideas for the future of your industry.

And most importantly, we’ll feel like partners: you’ll trust us to push you forward.


What does our partnership look like?

We build your strategic concerns into our research programme.

We become your advocate throughout our ongoing research.

We bring our newest findings to you four times a year, while the change is fresh and the opportunity untapped.

But we also know that every team is different, and has different needs; we’re happy to build the partnership that does what you need it to do.


What does our partnership look like?

A GDR partnership combines our services in one tailored package that builds a better innovation culture through regular, shared insight and inspiration.

Clients get all-year-round access to a dedicated Senior Consultant who uses your key concerns and initiatives as a filter to focus content, insight, and the way we work with you.

Combining quarterly in-person sessions, research and our digital workspace, the engagement is a comprehensive service for inspiring a business.


We offer our clients a range of additional services beyond our partnership packages.

We recommend an approach based on your specific challenges, from individual project needs, to training and development programmes and long-term strategic initiatives.

We can be as hands on or hands off as you need.

Conference Speaking

Field Expeditions

Innovation Workshops

Project Consultancy


GDR is an independently-owned global consultancy with 20 years experience

GDR’s Founder and CEO, Kate Ancketill, leads our team of 15 people based in London and New York. We have a diverse range of backgrounds and experience including brand design, product and brand development, consumer research, editorial and futurism.

London: Will Seymour, Senior Consultant [email protected] Sophie Corcut, Senior Consultant [email protected] Kate Ancketill, CEO [email protected] Felix Scarlett, Insight Director [email protected]

New York: James Mullan, SVP Global Innovation [email protected]

GDR Creative Intelligence, 1 Malet Street, London WC1E 78JN +44 207 580 5589 www.gdruk.com