preface Changes dominating the political, economic, social and technological stance of the UK market, are inevitably affecting consumer behaviours. Consequently, this trend report determines 3 macro trends due to influence the retail landscape in the next 5 years. Broken down into sections, each trend highlights key drivers, impacts and consequences for each movement, resulting in key takeaways that will provide a positive outlook for the highstreet.
neo sceptic
the hand over
5D
trend overview consumer profile trend drivers trend impacts case study consequences key take aways
trend overview consumer profile trend drivers trend impacts case study consequences key take aways
trend overview consumer profile trend drivers trend impacts case study consequences key take aways
neo sceptic
With years of deceit from brands and higher powers, the world is in search of trust, transparency and reliability. Reliance has shifted from those in the big seats, back to our communities. Combined with a more DIY ethic this ensures honest purchases from foods through to textile.Through processes such as growing our own, and purchasing from local business owners, this elimates possibility of buying into guilty brands. it’s about fact, not fiction.
Consumer profile #1 Basic needs: Honesty Creativity Community Connection
trend drivers
Whether its the economy, politics or how much horse meat we’re consuming, we’re constantly presented with scandals across a wide range of sectors. The dishonesty presented by the higher powers is forever making us question their authority and their honesty, with the likes of Snowdon shaking up our naive nation into a new age of sceptics. Whether the MET police, the NSA or simply our country’s governments - can we ever trust them again?
We want to know what we’re buying into. The media has revealed many factors that have shaken up consumers purchase habits, from corrupt product cycles and slave labour, to recycling, sustainability and climate change. Stemming from sectors such as food - with many consumers buying into organic and local produce - consumer can no longer play ignorance when faced with corruption in retail, specifically textile.
High street stores such as Primark and H&M - big players in the fast-fashion race - have hit the headlines recently for poor ethics and conditions for workers in Bangladesh, Cambodia and India. With this, consumers no longer want to feel to blame for such issues, with this, welcome a new age of ‘guilt-free’ consuming.
trend impacts
Brands are giving us the window to their soul. From recycling and waste, to pattern cutting and global profits, they’re giving us an insight into every step of the chain - its all about transparency and traceability. Due to the driving scandals and scepticism from consumers, brands have no choice but to bare it all.
“if you dont do it now, you’ll have to adapt when complete transparency becomes mandatory”
art director of Hugo by Hugo Boss
Alongside traceability, brands are sharing their worker community, building that crucial connection between maker (or farmer, distributor or seamstress) and consumer. Fast food giant McDonalds are at the forefront of this idea, allowing us to ‘meet’ the farmers who supply their meats and potatoes. This method reduces consumer guilt, allowing them to know that ‘Mike the potato farmer’ from Surrey, England’ isn’t being exploited. Oh, and the 100% British cows aren’t either. Alongside this, the brand has recently opened the doors to their factories as documentary youtube videos. A response to FAQs and concerns from consumers.
Fast Food brand McDonalds have introduced their consumers to their ‘farmers’ through short videos on their official site. This came as a supposed response to their ‘pink goo’ video appearing online.
Welcome; the open kitchen, the (literal) window to a restaurant’s soul. In effort to restore consumer trust, such additions ensure complete gastronomic ease, providing diners the opportunity to glance upon how their food is prepared, plated and presented. But then again, what have they got to hide? Combined with national concerns about health and the accessibility to reviewing sites such as Trip Advisor, restaurants need to take every precaution to ensure regular, happy custom.
The Albion, Shoreditch
The Albion Cafe 2-4 Boundary Street, Shoreditch, London E2 7DD United Kingdom
Profile: Albion is a cafe and small shop, with an in-house bakery and cake counter, where the vast majority of the food and drink products are British. Set back from busy Shoreditch high street, this trendy hidden gem provides high quality food, with localised comforts.
What do you like about The Albion?
Have you seen this in any other restaurants?
“I like the simplicity of the Café. It’s fresh, bright and really comfortable. I love the nostalgia and homeliness it adds by having the fresh baked bread and vegetables around. Although its pretty pricey, they serve great coffee and breakfast, all in a really chilled atmosphere.
A few yeah, but not done so well. I guess it’s the fact that the café is clean and airy, with white walls. It oozes ‘freshness’ (if that’s the right word? ha-ha) I’ve been to other places where it’s done, but its through a window, which is normally steamy.
What about the open kitchen?
The good thing here is that it’s like a real kitchen, open. Which again, makes it quite homey. I’ve been to places such as Benihana etc, where the food is made and prepared in front of you, which again, helps with the ‘unknown’ element of restaurants. But overall, I think the Albion really tops it.
I think the best thing – about any restaurant - is being able to see what you order. There is nothing worse than being left to a guessing game about how your food is prepared and handled. I think that’s what The Albion does right. If you want, you can stand up and see the chefs preparing your meal, through to the waitress bringing it out. I guess that’s what people pay for.
Interview: Chris Falkner– Head Designer at Bulldog London UK (customer)
With rising food prices and a slow healing economy, more and more consumers are going back to traditional lifestyles when it comes to their food. With 51% of the UK revealing they would consider growing their own, efforts are not restricted to those with rolling acres or even metre-square allotments. Books such as ‘Edible Cities’ by Judith Anger, “celebrates urban individuals who have embraced growing their own - be it through balcony gardens or more unconventional means.” Alongside this, own-growing ensures 100% food-factuality. From seed to plate, growers are aware of what is going into their food, and therefore their bodies.
Like that of own-growers, the rise of craft and the ‘do it yourself’ ethic has re-emerged. Post throw-away culture, mass consumerism and fast fashion - quality, care and longevity has become core to culture, a blossoming feature to the make-do and mend ideals. This has come in forms of food, fashion, interiors and furniture. This anti-capitalistic idea has begun to slow things down, showing the importance of community and care, and less about sale and profit. Combined with growth of web 2.0, creativity and community have encouraged the rise in crowdsourcing, with sites such as Etsy and Kickstarter collecting billions of dollars in pledges to creative projects and ideas from people around the globe.
trend consequences
No more bullshit. Packaging will give us more than we ever want. Instead of words with multiple syllables, the ingredients are those we know and can relate to. Take the Real Food Farm in Baltimore, with their ‘no fuss’ meat packaging, or those at ‘Slow Fast Food.’ Not forgetting the Original Source shower gels. In terms of design, its all about clarity and simplicity. Often combined with a bold palette, consumers are not clouded by persuasive images or language.
Suddenly sporting ‘honest’ as your key message is vital. Take Honest Burger of Brixton (Soho, Camden, Portobello Road) known for their burgers inspired by British produce. Honest now seems to be less about being honest with our bodies, and more about being honest with the world. The common good.
In a wake of science, packaging and products have developed from the days of fictional fantasy. Out of bright colours and sales pitches, this ‘no bullshit’ approach is combined with factual evidence and scientific elements to produce something that symbolises an equation or a snippet from the periodic table. Science enhances consumer ease by delivering fool-proof facts.
American cosmetics retailer Kiehl’s specializes in making premium skin, hair, and body care products. Founded as a single pharmacy in New York City’s East Village in 1851, Kiehl’s was purchased by the L’Oréal Group in 2000 and currently has more than 250 retail stores worldwide.
take it back to tailoring
wake of the workshop
No more just talks of tailoring. Personal preference, cut, fit and comfort will be key. Consumers will want to see this take place infront of them, feeling as if they have involvement with the production of their garments and products. A size no longer fits all.
This will be the wake of the workshop, 3D printed or not, more and more people will be interested in how things are manufactured. Hermes silk allowed us to take a peak of just how they make their luscious neck-pieces, with a mission to share the knowledge and skill of the workforce and makers in such industries.
made in store
retail education
M&S made in store snacks have given us that freshness we want with our food, and LA born brand American Apparel are known for their inhouse manufacturing warehouse that supplies their goods globally. This is a time where local can also mean global. As production prices rise in China, is this a key time to start really bringing it home?
Retail spaces can become an area to educate. Whether a chef, tailor or designer - stores can become somewhere consumers can learn about their products and their manufacture, keeping them in the know in a practical way. This would become a method in which consumers can feel an honest connection to brands.
the hand over
With the rise of online shopping and social media sites, brands are creating a backlog of endless data on their consumers that they are currently selling to the highest bidder. Consumers are naively handing over personal information that is being used and exploited to create a better understanding of consumer behaviour. With companies using social media and cameras to spy on their shoppers, is there such a thing as privacy?
Consumer profile #2 Basic needs: Good customer service convinience honesty Security
trend drivers Trend Drivers
With ‘The Cloud’ making Wi-Fi available to people on the go, consumers are able to connect whether they are at the doctors or in a restaurant. This means they are accessing more apps on-the-go not realising what terms they are signing up for.
Super brands like Amazon, Google and Facebook, have access to endless amount of personal data on their consumers, that they can sell on to businesses to help them get to know exactly who their consumer is, and their interests rather than guessing. The late majority trust Google, and don’t second-guess when they are asked to handover personal information.
trend impacts
In 2009, Google launched it’s ‘Target ads’ which have lead to brands such as Amazon, Netflix and Spotify to start recommending products to consumers based on their past interests. This new consumer is more demanding than ever, and with big data, brands can collate all the information about their consumer and suggest other products that they know they will like.
British Airways are now launching a new scheme called ‘Know Me’ where they are ‘Googling’ passengers as they get on and off the plane, so they can greet them by name to create a more ‘personal’ customer service. As well as this, Tesco are scanning customers faces at their petrol stations so they can detect their age and sex for advertisers. Apps such as Angry Birds are also being exploited by US and British spies to gain access to personal data from mobile phones. Slightly intrusive?
“Since its launch, Angry Birds has been downloaded 1.7 billion times”
Google Glass, spectacle frames allow users to record video conversations and read messages via a panel over the right eye. They have not yet been released for sale but are already the subject of intense government and consumer scrutiny. In a survey completed last year 61 percent of respondents believed that the devices should be subject to regulation and 20 per cent think Google Glass should be banned completely.
trend consequences
“Biometrics is fundamentally a technology designed for oppression and control� Frank Regner, CCC
The naivety of the late majority means that programmes such as the biometric finger scanner on the iPhone are being accepted without hesitation. Consumers are handing over even more personal information without giving it a second thought. This is mainly due to the trust they have in corporate brands such as Apple and Google, which is why they are getting away with so much.
With all the data that is available these days it is no wonder that hacking has risen. But what these hackers are now doing is showing consumers how unsafe their data really is by hacking into companies and showing how easy it is. In December, American retail giant Target had 40million of their consumer’s credit card details stolen, making many consumers question the safety of their data.
“The number of smartphones, tablets, laptops and internet capable phones will exceed the number of humans in 2013� Cisco report, 2013
Consumers will begin to become increasingly curious and ‘creeped out’ by how much information brands will have on them. Consumers are already researching ways of opting out of Google target and Facebook ads, as well as taking it upon themselves to investigate how safe they really are. The rise of ‘connected’ devices in the home offers spies a window into people’s lives. A guy recently found this out for himself after he realised the adverts on TV were very similar to the things he had been researching online.
EMC Data Solutions, London
EMC London Office 100 Leadenhall Street, Third Floor, London EC3A 3BP United Kingdom
Profile: EMC is a global leader in enabling businesses and service providers to transform their operations and deliver IT as a service. Fundamental to this transformation is cloud computing. Through innovative products and services, EMC accelerates the journey to cloud computing, helping IT departments to store, manage, protect and analyze their most valuable data in a trusted way.
1. How does big data benefit your company?
4. Where do you see the future of big data going?
Companies are using big data to understand more about what their customers or consumers want, what they are thinking and help them offer a more personalised products, services or experiences. My customer, a credit card company, uses big data services to analyse its customer spend history, what they purchased and how long they take to repay, to offer special interest rates, or cash back incentives to encourage certain clients to use their cards more. They also offer points/rewards/loyalty schemes that can be accumulated towards flights, holidays, discounts with certain retailers etc. All designed to maintain clients and encourage use of their credit card over other competitors
As fashion and trends change more and more frequently, retailers will have to move fast to exploit the latest and greatest products. That will mean understanding more about what consumers want and designing or identifying products or services their consumers will want. It will be about making it a more fun experience.
2. Can consumers learn anything from big data? Consumers will hopefully receive a more personalised service giving them access to deals on their favourite products or services at the right time. Eg the last thing you want is a deal on a new car when you just bought one. It’s all about understanding more about what consumers want and when they might want it. Timing is really important. 3. Do you think that the process of big data is intrusive to your customers? Big data can be seen as very intrusive and if not handled with care and sensitivity, can switch a consumer off from using a companies’ product or service. Too much spam mail or post just turns people off. I think it’s all about timing. E.g. getting the right offer to the right person at the right time.
5. Do you think that big data is encouraging hackers? Yes, any source if private and confidential and commercial information (bank, credit, national insurance, health records, product secrets etc.) are targets for organised crime of all types. As governments and companies hold more information about individuals the more time and money they will have to spend protecting it. The same goes for what is known as ‘sovereign threat’ where foreign governments are ‘spying’ on other countries, politicians, and companies etc. to steal valuable information to give them an edge politically and commercially. For example, the recent Wikileaks exposures showing the US government hacking the private phone calls of foreign leaders etc. 6. Is your consumer’s data ever safe? Or does it always come with risks? You can never say private information is 100% secure from hackers. Hackers are made up of a multitude of different sources e.g. rogue individuals just out to prove they can break someone’s security, organised crime, looking to profit from stealing identities and private information etc. for financial gain to governments etc. As technology closes holes in technology, the ‘hackers’ are not far behind finding gaps in the system.
Interview: John Graham– Client Director, EMC Data Solutions London UK
we know what you need
the corner shop
In the future data will be able to predict what consumers want before they know themselves. Advertisers and retail stores will be ahead of the curve and will always be at the forefront of consumer’s actions. Universities in California are using big data to see which students will do well and pass in the future before they are even accepted.
In the future brands will look back and create the ‘corner shop’ experience in their stores, retailers will know who you are and what you like the buy whether its online, in store or via mobile. Technology and big data will allow retailer to know their consumer on a much deeper level to create that much wanted personal experience.
stay alert
Brands such as Apple have begun to incorporate sensors into their stores, which alert consumers with deals as they walk past. In the future brands will be able to personalise these alerts so they only target people with a deal that is relevant to them, no more spamming!
5D
Innovative technologies are increasingly being integrated into our everyday lives, 5D centres itself around testing the boundaries of the virtual environment, with the five senses, the ability to see, touch, smell, taste and hear the future. The physical and digital worlds are merging, creating a whole new meaning to consumer engagement and ‘try before you buy’. Interaction Connection Engagement Humanisation
Consumer profile #3 Basic needs: Interaction Humanisation Connection Engagement
trend drivers
With the rise of e-commerce, many retailers are underestimating the role of their bricks and mortar estates. Shopping habits of 18-25 year olds suggest that 68% prefer to shop in stores for clothing. Brands such as Ebay and ASOS plan to have a physical store in coming years, as bridging the gap between online and offline is becoming vital. Many brands hope to smooth all channels of communication by introducing the concept of ‘Omni-channel retailing’. We want to understand the brand’s literacy on every level.
The structure of the job market has changed, with increases in the proportions of professional and managerial occupations, meaning consumers have less time than ever. This means we have less time to shop and more returns. This consumer wants to try a product, without having to physically do so.
No Time bracelet, Designed by Katrin Greiling
With innovation of wearable technologies at the forefront of our futures, we are seeking to be part of new invention, meaning brands need to integrate these technologies within their brand identity. Remembering that augmented reality has the ability to heighten our senses, consumers will be more empowered than ever before.
“the best have created multiple touchpoints, physical and virtual, that engage shoppers in a more customised way�
Jawbone has developed human-centered wearable technology and audio devices unparalleled in their technical innovation, ease-of-use and sophistication of design. (jawbone.com) Their new UP system helps you understand how you sleep, move and eat so you can make smarter choices.
trend impacts
We don’t as humans tend to be very good at visualising. A whole new ‘ try before you buy’ concept is revolutionising retail online and offline. The Ikea furniture app, allows you to pick an item of furniture and virtually place it within your home to see if it’s right, whilst virtual fitting rooms, such as fits me provides consumers with a way to try on clothes, without actually doing so. Similarly, Rayban & M&S have incorporated this concept into their stores.
Swedish giant IKEA has made designing the home easier, through the use of their augmented reality application. Bring furnishings to life.
Are we putting more trust into all things virtual? Virtual Currency is paving the way to our future, BITCOIN is booming. Investors are piling into the digital currency, which is not issued by a central bank but is conjured into being by cryptographic software running on a network of volunteers’ computers. Similarly, ‘coin’ is one card that virtually stores all your cards so you only have to carry this one, with the ability to choose which one you pay with.
“The whole company’s premise is to simplify and improve people’s lives”
There is a greater need for seamless customer interaction as we have less time on our hands, we all hate waiting. Doctors surgeries are reacting to this with the utilization of an avatar that acts as a doctor, prioritizing treatment without the time wasting, whilst reducing the need for surgery visits and receiving advice in their own homes.
5D isn’t just about making things more simple, it is about enhancing the experience. Imax cinema is an example of the importance of this, there is no frame, the picture is bigger than your field of view, you’re no longer at the window, you’re outside among the stars. It grabs your senses, creating a fulfilling virtual experience.
trend consequences
We no longer want a boring experience in our stores, we want to relate to a brand on every level, it’s the details that count. Abercrombie and Fitch attract the teen market and in store spray perfume in changing rooms after every person has left, reinforcing that next time you smell this smell- you will be coming back. Similarly, slow music increased spend in supermarkets by 39.2% and since then, Nike has found introducing scent into their stores increased intention to purchase by 80%.
“Physical space continues to be one of the most effective means of connecting with customers”
“Selfridges becomes a portal into the creative mind, as they explore the power of imagination to drive the process of innovation and inform the shape of the future�
Brands are seeing the importance of humanizing and personalising the virtual experience. Burberry’s ‘Kisses’ allow users to virtually send a kiss to any destination or individual you want, creating a personal connection to the brand. As part of the Festival of Imagination taking place this month at Selfridges, fashion designer Gareth Pugh has worked with Inition to create a “multi-sensory experience” called Monolith. The installation uses an Oculus Rift virtual reality display embedded in an angular helmet to transport visitors through monochromatic cityscapes filled with strange shapes and silhouettes. This shows how the merging of the physical and digital worlds can increase consumer engagement with the brand.
Perch Interactive, New York
Perch Interactive 265 Canal St, New York, NY 10013, United States
Profile: PERCH is a startup intent on revolutionizing retail by introducing a series of game-changing interactive display technologies. They believe there is value in holding a product in one’s hands, and that that value is perennial. They also understand the value in the digital shopping experience, in having a world of information at one’s fingertips. Based on these two firm beliefs, PERCH envision a future in which the two experiences are merged into one coherent, enjoyable and productive shopping experience.
Interview: Kate Watson – Interactive Producer, Perch New York, US
How far do you feel the ‘5D’ (merging of the physical and digital, using the senses) will go in retail? Where do you feel it’s heading? I think the whole thing about Perch is it’s really all about connecting physical products with all the rich media content that you would find on the web, so that includes video, that includes audio, so what you just mentioned about the senses is totally true, I think PERCH really is currently just tapping into the visual and auditory senses, but certainly touching the products could be considered like a third sense, we’re very interested in, certainly, in the other senses as well but that’s going to be down the line, the thing that we do that we’re really passionate about is, kind of, taking out the middle man of for example, having a phone in your hand, or having to be really tied to be hyper aware of the technology. So if you took a look at our website you’d know it’d be really be about this seamless marriage between the products and the sensory experience and really the goal is to erase all of the technology in-between, so often times we when install perch in stores we are really careful about mounting it to the ceiling, like a light fixture so you don’t even see, you literally wouldn’t even know that perch was there, it’s really this totally seamless thing. I think because people are used to accessing media through your phone or some sort of device, it really does feel like magic, and I think that we’re going to move more and more to this magical quality of media just being embedded in spaces. Do you think brands understand the importance of embedding this technology into their retail environment? I think so. We’ve been around for 2 years now and we’ve done a lot of projects and we meet with brands all the time, and I think there’s a hunger for this seamless marriage and it still feels really new to them. We hear all the time that brands don’t want to be first and they don’t want to be third. We’re currently launching with ten Kate Spade stores and I think Kate Spade, they’re the ones sitting in that exciting second place, but you know we’ve been talking to them for close to year, so it definitely still feels new and risky to be doing it. So there has to be people either on the marketing side; usually it’s the people on the marketing side that have the vision, the will to be taking that risk on. Have you testing Perch on consumers? What is there reaction to the technology? They love it! I mean it’s again this magically quality which is illustrated really nicely, and the way people want to interact with it and you can see, kids probably react to it the most strongly, which is really a good sign, as I think you know that they get it right away and I think in general we try to keep the bar really low in terms of access, we try to make it a very simple and easy, and we do a lot of visual ques like right off the bat when you walk up to it- we call it in the ‘attracter loop’ they’ll be like a glowing button which says ‘pick me up’, so we try to leave ques everywhere that make it really simple that make it really user and consumer friendly.
What’s the most interesting thing you’ve done with Perch and a brand? The most interesting thing for us obviously is having it installed in a bunch of stores, the Kate Spade project, just to mention that again, it’s ten stores, its just launched and it’s going to be ten campaigns, so every single month there’s going to be a full refresh of content, that from a business perspective is really exciting. I think we’ve done some really edgy things with Perch, beyond the basic platform. We just did, a whole interactive game experience for Getty images, at south by southwest, which goes way beyond our standard projects, it was this interactive map where you could toss a ball out onto the map and discover Getty images around the world. Is there anything else you’ve noticed that will be big in the future along those lines? I think scent is going to be a big one, I mean scent is one of those things, that’s really hard to control and its really hard to do on a large scale, right now, but the great thing about what we do, its certainly not easy, I’m not going to lie. Once the first unit is kind of installed in the physical space, because we’ve built this whole back end cloud system we can update the content remotely as many times as we want to, I mean when you get into stuff like scent and taste it’s really more about a bespoke custom experience because there’s no way to push scent through the cloud right now. I mean maybe there will be, I think it’s fascinating and you’re definitely tapping into where things are going to go. Another realm that I think will be really essential, is if you’ve encountered the world of physical computing, but there’s a lot of DIY maker type people who are hacking technology to create their own devices and there’s a lot of, kind of like the cooler version of robotics and stuff, you’re going to see a lot of that in retail spaces. What’s the market range of the brand that get in contact with Perch? Are they luxury brands or…? I’d say right now it’s really the luxury brands, those are they guys who have the budgets for innovation. I mean a lot of brands now have innovation labs, that they’re really… they get it, they know they have to be doing a lot of thinking about the next 10, 15 years. The brick and mortar stores of today wont survive otherwise, so but you have a lot of income to do that. But our ultimate goal is to be on a mass scale, that’s what we really want.
“What Perch trusts to happen is there to be a space beyond online, people will expect there to be rich media content everywhere and on everything� Kate Watson of Perch, New York
playful generation
touchy feely
Interaction between smartphones, iPad’s and the instore environment could be a new phenomenon. Apps such as ‘Blippar’ allowing us to interact with brand logos through augmented reality, and Ibutterfly, an app that focuses upon catching virtual butterflies instore to ‘catch’ promotions and offers.
A Computer giant claims future gadgets will include haptic feedback technology allowing you to virtually feel clothes before buying them. This could revolutionise retail, computers that allow consumers to ‘feel’ an item of clothing on screen could mean a whole new level of product engagement for retailers and consumers.
smelly communication Is the future about sending smelly communication? The Ophone, allows us to do just that, still in the making, this gadget attaches itself to the bottom of your phone and will allow you to record smells and send them to your friends. This is an exciting concept for brands who can market to all the senses, ‘smell this leather jacket, I’m going to have to buy it’.
tingling tastebuds Life in virtual reality could soon get a whole lot tastier, and now a digital simulator can transmit the taste of virtual food and drink to the tongue. With the possibility of many health benefits, providing a satisfaction with no physical side effects, retail could provide consumers with a guilt-free experience.
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TREND FORECASTING
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TREND FORECASTING Katie Ford Beth Carpenter Amy Beadle