Global payments and shopping service Klarna has released new data that highlights the necessary adaptations retailers must make to attract shoppers in the future. The Future of Retail report suggests that with the rapid advancements in technology, AI, AR, and robots are poised to play a dominant role in both in-store and online shopping experiences.
Companies like Klarna have already started incorporating AI personalisation into their products, indicating the growing significance of these technologies in the retail landscape. Over the last 18 years, the online retail sector in the US has witnessed remarkable growth, accounting for a substantial 484% increase in retail sales.
Klarna engaged with over 5,000 consumers from five countries and collaborated with retail expert Kate Hardcastle, MBE. Together, they delved into the potential evolution of the future of shopping, conducting research and gathering insights to shed light on emerging trends and possibilities.
A promising future for AR/VR shopping
The study focused on analysing shopping behaviours and habits 18 years ahead, anticipating the time when Gen Z individuals will reach 40 years old and, alongside Millennials, become the predominant consumer group.
Klarna’s findings also unveiled insightful predictions on how emerging technologies will shape future shopping experiences. These technologies encompass various advancements, including:
- More personalisation: A hefty 65% of respondents expressed a desire for the shopping experience to become more personalised. In addition, 36% of participants were confident that personalisation will be a prevalent feature both in physical stores and online shopping environments.
- Not physically trying on clothes: Up to 53% of respondents say they’ll prefer to continue trying on clothes in-person as they do today. However, 48% say they’ll prefer to try to use virtual dressing rooms, while 28% favoured the use of AR. In addition, 23% indicated their reliance on AI for personalised advice on clothing that best suits their body type and fashion style.
Robots and VR shopping assistants
The demand for robot fashion advisors and virtual personal shopping assistants is on the rise as 59% of respondents expressed openness to the concept of a robot approaching them in a physical store to take measurements and offer style recommendations.
Furthermore, 18% expressed interest depending on the appearance and behaviour of the robot. Moreover, 34% of participants desired access to virtual personal shoppers who could provide tailored recommendations based on their fashion preferences and style when shopping online.
Hardcastle commented, “Retail and shopping trends have evolved significantly over the last decade and it’s clear there are more changes to come. Technologies like augmented reality have the potential to transform rundown physical shops and revamp the in-store experience for shoppers.”
An overwhelming majority of respondents (81%) anticipate that AR will significantly enhance their in-store shopping experience. However, one-third of participants (37%) believe that AR will eventually become a standard feature in retail stores.
We’re still years away
The study also shows that VR won’t replace real-life shopping experiences anytime soon as a mere 43% of Gen Z individuals believe that shopping in VR will surpass the experience of physical shopping in the next two decades.
In addition, the consensus among Gen Z and Millennials (64%) is that the majority of physical stores will become completely cash-free in the next 18 years. Also, 31% of these individuals believe that this shift towards cashless stores will occur within the next five years.
David Sandström, chief marketing officer at Klarna, commented, “In the Western world, approximately 80% of all online purchases are made through search, while the remaining 20% are based on personalised recommendations.”
Sandström went on to add that Klarna’s study confirms that shoppers in the Western world desire a comparable shopping experience in contrast with China where 80% of online transactions are driven by personalised recommendations.
“The next generation of consumers will expect a highly personalised shopping experience where products find them instead of the other way around,” said Sandström.