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Reimagining the future of retail

Virtual Reality and Augmented Reality have been creeping into retail for years, but COVID-19 has thrown them onstage and into the limelight long before their scheduled appearance. Take jewelry maker Kendra Scott. In March, when her stores were forced to close, Scott fast-tracked the shift to letting customers try on earrings using an app, and added other jewelry later.

Sephora already let customers that do virtual makeovers on their phones, trying different skin care and makeup products without having to wash their faces in-between. And, Zeekit, an Israeli startup that uses military-inspired mapping technology for fashion, exploded from having a few brand customers to preparing to open its own marketplace. The technology scans garments from many different brands, breaking down each one into 80,000 segments. It does the same for a customer’s virtual physique. So that customers can “try on garments” using augmented reality from any of the stores served by Zeekit, as well as mix and match and get styling advice. Zeekit is planning to open its own marketplace in October, though Amazon came up with it’s own version of AR fitting rooms recently, too.

Yes, there are privacy concerns with this method of shopping—but customers are at least safe from Coronavirus, a trade many may be willing to make. And once customers get used to shopping like this, it may become a habit.

Virtual reality and augmented reality have been creeping into retail for years, but COVID-19 has thrown them onstage and into the limelight long before their scheduled appearance.

Before the pandemic, the push was on to create stellar in-store experiences. Then COVID-19 happened. Now, malls are closing and some consultants predict that half of them will never reopen. Many of the flagship department stores that anchor malls are declaring bankruptcy, including Neiman Marcus and JC Penney. A June article said more than 2,100 stores had closed in a single week.

Stores that have reopened try to help customers in and out in minimal time, with minimal contact, and with their fingers crossed they won’t have to engage in a potentially dangerous fight over the mask-no mask issue. Some retailers check shoppers’ temperatures at the door, ask them to shop by appointment, offer no beauty consultations or product testing, have closed off changing rooms and bathrooms, and put items that have been returned in quarantine. All of this, of course, sends the message: “Leaving so soon? Let me get the door.”

[Related read: 3 ways retailers can prepare for the road ahead]

Shifting consumer priorities

It’s not just how people buy, that has changed, though; it’s what they buy. Currently, many consumers rarely leave their homes. Unemployment is predicted to reach or exceed Depression-era levels of nearly 25 percent and not return to more normal levels until at least 2022. If schools and daycares remain closed, many people may not be able to work even if they have opportunities to do so. The devastating impact on families can’t be overstated.

But the picture isn’t all dark. Some have found the sudden shift of lifestyle has some unexpected positives, and

One fashion publication said people are consuming fashion much more consciously now. Only 13 percent are buying as many clothes as they did before the pandemic. Many are reevaluating their need for so many clothes; others say they will focus on comfort more in the future—athleisure wear is big. And many seem to be thinking more about the social ramifications of their fashion choices, from the political stand of the brand to sustainable fashion, made from natural fabrics and without toxic chemicals, to clothing resale.

It's not just how people buy, that has changed, though; it's what they buy.

One study by ThredUp and GlobalData showed that the demand for reworn clothing was on the rise before the pandemic: 62 million women purchased second hand in 2019, up from 56 million in 2018. The market itself is expected to grow from $28 billion to $64 billion in 2024.

People also seem to be buying different things. One article reported that what people are buying (besides masks and hand sanitizer) include yeast, subscriptions to MasterClass, cooking supplies, good sheets, and the Nintendo Switch.

David Duncan, senior partner for growth strategy and change at consulting firm Innosight noted that COVID-19 has suddenly illuminated the patterns that people had in their lives that they might want to abandon. “For people who are lucky enough to have a job and a way to manage the craziness of parenting and work and all that, this has been the ‘great pause.’ This is the first time I’ve been home for more than a month in a row for 25 years. I can reflect more, on all kinds of things.”

Duncan, who co-authored a book about Jobs Theory called Competing Against Luck: The Story of Innovation and Customer Choice, said Job Theory would work well to help retailers figure out what’s next. The theory says that people don’t buy products and services, they hire them to help them get a job done. If the product or service does a good job, they may hire it again; if not they may fire it. Pandemic or no pandemic, customers have problems to solve. They must feed their families, educate their children, pay their bills, protect their health, and find ways to still feel good about themselves and keep themselves from going crazy during the pandemic.

[Related read: D2C retail: Why a simple customer experience is just what we need right now]

Giving shoppers an experience—still a priority

Some of those “jobs to be done” can be accomplished expediently by more utilitarian retailers focused on helping people get in, buy something fast at a low price, and get it delivered quickly. But retail handles another job, Duncan said, which is offering a positive experience, immersing consumers in the feeling of a brand or surprising them with a new discovery.

But retail handles another job, Duncan said, which is offering a positive experience, immersing consumers in the feeling of a brand or surprising them with a new discovery.

Some retailers do this through their websites. Patagonia’s site, for example, not only sells products, but features stories and videos about social and environmental issues, and about the types of places, adventures, and adventurers that inspire people to buy outdoor gear. Other companies are trying to simulate an experience in shoppers’ minds, and in their physical lives. High-end outdoor outfitter Canada Goose offers a Toronto shopping experience it calls “The Journey.” The socially distanced experience has shoppers enter via a walkway that looks and sounds like crunching ice surrounded by dark walls. They go into a cold room with real snow and vistas of snow-covered mountains. There’s no inventory in the room, but shoppers can order on an interactive screen inside the experience and have their merchandise within 24 hours or less. The company calls it a break from the pandemic insanity—though purchasing a $1,000 coat isn’t necessarily a break everyone can afford.

It’s possible that, in the future, the malls that do remain will no longer be the place where people shop for things. They might become interactive customer experience halls where people can engage with brands on a visceral level without any real merchandise, like Canada Goose. Or they might become much-needed warehouses for burgeoning e-commerce business.

Shopping could go full on AR and VR. Perhaps someone will even make it possible to have the experience of shopping on the Champs-Élysées in Paris or in a Moroccan Souk, then get the items at your house.

One thing’s sure, the future of retail just got interesting, fast.