We are only a few short days into 2024 but, as always, the retail industry is already looking toward its next evolution. While 2023 was defined by a mass awakening to the power and availability of AI and machine learning, 2024 will take these learnings and employ them at scale to deepen personalization efforts and bring customer-centricity further into the forefront. Retailers will look to create hyper-personalized, differentiated, valuable customer experiences that focus on brand memorability and meaning. Obsess predicts that 2024 retail technologies will revolve around four primary trends:
- The advent of spatial computing with Apple’s new Vision Pro device.
- A persistent growth in AI-driven personalization and predictive content.
- Gamification’s triumph as a necessity in online shopping.
- The evolution of dynamic merchandising strategies to enhance customer engagement and drive cross-selling initiatives.
Retail Technology Trend Prediction #1: 2024’s newest buzz phrase will be: “spatial computing,” courtesy of Apple Vision Pro.
The new year is set to embrace the mainstream emergence of “spatial computing,” marked by Apple’s upcoming Vision Pro device. This technology—driven by enhanced processors, ultra-high definition and global network speeds—promises revolutionary immersive shopping experiences. By integrating 3D digital interfaces mirroring human interactions, spatial computing transcends conventional online shopping encounters.
The arrival of Apple Vision Pro heralds a new era by seamlessly merging virtual and physical realms through a blend of augmented reality (AR) and virtual reality (VR). This device allows products to appear life-size in a user’s physical space via AR, enabling interaction through intuitive gestures with eyes, hands and voice. Although positioned at a premium price point, it aligns naturally with brands targeting innovation or luxury customers, typically gaining traction through early app store downloads.
Over the next year and the subsequent five or so years, expect spatial computing devices and apps to gain widespread adoption—providing a more natural, intuitive, and human-centered way of engaging with technology. The emergence of Apple Vision Pro could very well draw similarities from the advent of the iPhone.
Retail Technology Trend Prediction #2: AI will continue to dominate content creation.
AI continues to hold a pivotal role in crafting highly personalized and predictive content in retail, and even more notably in e-commerce. Advanced algorithms and data analytics decode intricate consumer behaviors, enabling tailored shopping experiences. From intuitive chatbots offering real-time assistance to precise product recommendations, AI-generated content and experiences will continue to enhance engagement and satisfaction aligned to bespoke customer journeys.
Obsess, in partnership with Coresight Research, reported in Q4 2023 that immersive experiences would be a top three priority investment area for brands and retailers during the following 12 months, Within immersive experiences, data/AI-enabled content for personalization ranked as the top investment priority.
According to the report: 71% of US-based brands and retailers have already invested in data/AI-enabled content for personalization. Of these brands and retailers, 77% reported significant or moderate increases in online sales.
Retail Technology Trend Prediction #3: Gamification will go from a nice-to-have to a need-to-have in e-commerce.
In order to stay relevant in 2024: retailers will need to incorporate principles of game play into their online shopping experiences. With over 80% of consumers engaged in video games, integrating gamified shopping experiences becomes pivotal to capturing and retaining younger demographics.
Gamified shopping content will become a direct line for brands to capture the attention of Gen Z. Similar to how social media once served as the ticket to captivate millennials, branded gaming will be the gateway for businesses to connect with Gen Z and younger demographics.
For brands and retailers to thrive in the current shopping landscape, embracing gamification as a core element of their digital approach will be crucial. Obsess has created over 300 virtual stores for brands, and the data from these stores proves that when brands add gamification into their virtual shopping experiences; they increase shoppers’ likelihood to add to cart by 10X, compared to when they do not include the feature at all.
Retail Technology Trend Prediction #4: Dynamic merchandising will elevate customer engagement.
Online retail strategies in 2024 will lean toward more dynamic merchandising, emboldened by data-driven insights and AI-driven analytics. Digital marketplaces will adeptly adjust product displays and content in real-time to show a wider, yet more tailored, assortment. These immersive displays will not only increase engagement and retention, but they will also unlock new opportunities for cross-sells and up-sells.
Virtual stores are types of immersive 3D experiences that harness spatial analytics, enabling the continuous fine-tuning of shopping environments using live data. Similar to physical store setups, virtual store managers can analyze browsing and buying patterns by rearranging products in diverse sections of the 3D space efficiently and cost-effectively.
Summarizing the trends that will shape the future of retail technology.
2024 promises to redefine the retail technology landscape with:
- Apple Vision Pro leading spatial computing advancements.
- AI’s continued dominance in crafting hyper-personalized content.
- The imperative integration of gaming principles into online shopping.
- Dynamic merchandising strategies that enhance engagement and cross-sells in e-commerce.
Brands and retailers that embrace these trends will cement their roles as critical players in the next generation of online shopping.