What 2023 will look like for retail in tech – WWD

After a rough year in which major tech platforms changed hands, revenues fell and online advertising stock prices tanked, it looks like tech is finally making a comeback — sort of.

The CES electronics show returned to Las Vegas this week, albeit on a smaller scale, following years of complications due to Covid-19. The Consumer Technology Association, the organization behind CES, estimated 100,000 attendees for this year’s segment, which is somewhat impressive since the pandemic ended. But attendance is slightly more than half the normal figure compared to its pre-coronavirus numbers.

For consumers out and about, the urge to see the latest innovations was irresistible, even braving the rare desert rains and stepping up security measures. Industry executives had other motivations. They’re busy holding court at private meetings in convention center suites and hotels on the Vegas Strip, wheeling, and writing the future of business and technology with their speeches. Insightful experts, analysts, and others can get wind of influential activities that are shaping all kinds of sectors, from automotive to home appliances, personal care, and of course, fashion, beauty, and business.

WWD caught up with several experts at the show and elsewhere, and did a lot of research to find out what’s on the tech radar for the future in retail. Here’s what brands and stores should be on in 2023.

The sweet smell of technology

In the year In 2019, Procter & Gamble introduced a novel device called Aria at CES, a connected “smart smell device”. It seems a bit weird then. Now it seems like the first sign of what’s to come.

According to CBB Insights, the push to digitize technology scents will make its mark by 2023. While light and sound are easily measured by sensors and can be reproduced mechanically to create a predictable sensory experience, odors are more difficult to decode because they depend on complex interactions between molecules and olfactory receptors.

While the challenges are formidable, the marketing benefits are clear. “Food and beauty companies can quickly and cheaply use smell prediction to identify products that consumers will really enjoy,” writes CBB Insights.

Case in point: At CES, OVR Technology unveiled the new ION 3, a wearable “sniffer” for VR, AR, mobile and desktop gaming. According to the company, the universal cartridge for it can create thousands of different aromas, which significantly increases the limited options for the Procter & Gamble Legacy Iria. “Until now, no one has successfully harnessed that power to improve our digital experiences, but OVR has digitized our sense of smell so we can get the most out of digital experiences now and in the future,” Aaron said. Wisniewski, CEO and founder.

CB Insights has been seeing this kind of startup activity accelerating around the digital landscape. Major tech makers like Google have been pursuing breakthroughs in the arts and sciences of scent, including how to mask odors using artificial intelligence, the company said. “Google’s AI team recently announced that it used machine learning to map molecules into scents,” CB Insights added. “By delving into massive data sets, the team was able to successfully (though not perfectly) predict odors from molecular structure.”

Is there an “internet of perfume”?

Sustainability graduates

Green initiatives have been on the rise for years, but this week at CES, it’s a major theme at keynotes and exhibits. It has also inspired fashion and technology to join forces in a new way: Samsung and Patagonia have teamed up on a new project to reduce the environmental impact of microplastics released during laundry.

They developed a new washing machine filter to reduce microplastic emissions at the end of washing cycles, preventing them from entering Earth’s oceans and other aquatic ecosystems.

“Samsung’s new mini microfiber cycle and filter are the result of that collaboration,” according to the announcement. “In the fight against microplastics, the tiny microfibre cycle reduces microplastic emissions by up to 54%. Now available in Europe, the cycle goes into compatible washers. [South] Korea from February this year and soon in the US.

Patagonia has always been a strong advocate for the environment, but this business and others know it’s time to take things up a notch as consumers increasingly choose cause-based brands.

“I’m really excited about the number of people who are creating textiles and fashion products that are environmentally conscious, and I think technology is enabling so much — from the way we use machines, to sewing clothes, to the way. Take blue jeans, for example,” Elizabeth Gore, founder of fintech company Hello Alice, told WWD.

“Jeans used to be one of the worst things on the planet, and now they’ve made them into easier loops and less water flow,” she says.

Data democratization

WWD caught up with Hello Alice at CES to learn more about the trends they saw. The platform has leveraged more than 1.1 million small businesses, and from a recent random survey sample size of 100,000 owners, 94,000 were from the fashion or retail stage. Their biggest challenge was marketing and customer acquisition, but now a third said they are raising capital to deal with pressures such as supply chain disruptions and macroeconomic uncertainty.

As to what these traders do with the money, or at least what they should do, Gore highlights one key area first and foremost.

“What interests me the most is data analysis in fashion. “If you look at in-store consumer behavior, I think we’re reaching the tipping point of tracking clothes on your phone or in your store. [scenarios] How we shop, where we shop, how we shop. That reinforces and leads to a better shopping experience for the customer and provides better analytics for the seller.

Data intelligence, tools and strategies aren’t new, but they’re likely to peak in 2023, especially among Gore’s small or indie business customers, as the technology becomes more accessible.

“Data analysis is becoming very cheap, obviously it gives new people who sell fashion a big leg up on some of the big brands, because it brings a lot of equity,” she said.

5G connection for storage

“The deployment and availability of 5G is also a hot topic in the retail industry,” said Casey Lobaugh, Chief Retail Innovation Officer at Deloitte. “If you look at the stores and the store systems in the major clothing retailers, they are still somewhat old systems that operate in a disconnected mode. The reason for that is that the system or the point of sale falls into a network-based model. [would] Close up shop.”

But he explained that this is clearly changing, with a dramatic push to upgrade and revamp store systems and strengthen connectivity so that a simple internet outage doesn’t disrupt the entire business.

That of course includes the point of sale, but is not limited to cash wraps. It also extends to the store’s broader systems collection, so “it uses networking, cloud computing and the centralized model,” he explained. Consider real-time monitoring, whether on the shelf or in the back, or AI insights into traffic flows.

“Because we know more about the consumer, we can personalize the experience,” added Lobaugh. That works for stores of all sizes, but for large retail chains, there’s a clear advantage: they can easily offset experiences significantly for each door. “We’ll be able to personalize individual stores even more because we’ll get more brands.”

Personalization, “micro” retail will be essential.

More signals — read: data — means more potential for things like automation and predictive analytics. According to Lobaugh, that’s no longer a “nice to have” and more like a “must have.”

It will lead to more personalized experiences like product recommendations, styling advice and similar features. All of that has been going on for years now, but with more tools and resources from providers like Google Cloud, Amazon Web Services, and others, as well as better connectivity and data modeling capabilities, they’re poised to become more ubiquitous and sophisticated. , up to the granular level.

“Our customers are changing from wholesale to micro, because the market is changing and becoming more appropriate, especially in clothing, certainly in the number of options you have, the number of variations, the number of companies that target – especially – what are your needs,” he said. “Low cost, or gender-neutral clothing, or individual needs of x, y or z. There is dramatically more choice, and that means the market is increasingly targeting those wants, needs, and desires.

In a large retail organization, that clutter manifests itself in other ways as well.

“[If you] Know that the market is shifting in that direction, which means you have to be incredibly granular, and that means every decision you make has relevance. Where do I store? What should I sell? How much should I sell? How to play with inventory and pricing? All these things are facing the same pressure.

“When people try to control that level of majesty, they can’t,” Lobaugh added. He calls it the “decision orchestration,” and retail is years away from heading that way.

Now, finally, the time seems ripe. If that’s true, this could be a critical, perhaps game changer, that could change the retail business for many.

A final note: Although social media doesn’t make this list, its influence cannot be denied.

“TikTok has covered any social media channel for small businesses selling products,” says Hello Alice Gore.

The backlash in Washington, D.C., stemmed from fears over U.S. national security over TikTok’s takeover by China’s ByteDance, but those concerns aren’t keeping retailers up at night, she said. That could change if the social video app takes decisive action, but it’s unclear if that will happen in 2023.