[Intern Insight] Imagine the Future: The Transformation of Brick-and-Mortar Stores

In the previous articles in this ‘Imagining the Future’ series, I talked about technological advancements and how it may impact the retail industry. How it can help train employees, or establish the customers’ journey in stores. How it can offer detailed insights at a level previously impossible, and how that can that affect customization, which is so important.
In this article, I would like to imagine how the brick-and-mortar stores will be affected by these technological advancements. After all, if you ask a customer about their shopping experience the first thing that pops into their minds is still the last physical store they visited.
Let’s start with the beginning: What is the current state of the brick-and-mortar stores?
Well, they are still important, that’s for sure! How do I know? Look at Amazon! With pop-up stores and bookstores all across USA – and the new launch of Amazon Go – as a physical location, the largest online retailer has performed a reverse psychology on very unsuspecting customers [Source]! Sure, there are no cashiers and no check-outs, but the question remains:

‘Why does Amazon need to open a real store, in the real world?’

It turns out that customers are not as unsuspecting as we thought! One of their retail cravings is the experience, and nothing creates a better experience than something that reaches all our senses. We live in the real world and although the digital one offers many wonders, at the end of the day we go to sleep and wake up in the ‘here’ and ‘now’!
So what will the ‘here’ and ‘now’ look in the future?
Our lives are cyclical! We wake up, we go to sleep…every day! We look at the ‘kimonos’ from the Edo period and Alexander McQueen transforms them into the new ‘it’ in his ‘Haute-Couture’ Collection [Source]. We look at how food preparation 200 years ago, and Jamie Oliver starts advertising the benefits of growing your own food and eating local products [Source]! If those people from long ago could look at us they would think:

‘What’s so different?’

Would it be so surprising if, in the future, brick-and-mortar stores look just like they do now? Would have the ‘vintage’ feeling? With so many service interactions turning into digital experiences, at one point we will want to go back to the roots of what ‘service’ used to mean. That’s what Amazon is anticipating [Source].
When we analyse the retail brick-and-mortar landscape we notice that stores offer two types of experience designs – boutique self-standing stores, or as part of department stores. The first one offers the sense of exclusivity. ‘No other customer, but you, will ever experience this in-store journey! We are here to make your day special and unique!’. The other conveys the sense of choice.‘You can eat, you can drink, you can shop, you can go onto a roller-coaster! And you only have to move two feet to do these things!’

The truth is that brick-and-mortars must add multiple layers to create the level of complexity that a customer desires to experience. It’s like an onion. The customer enters and assesses the ‘atmosphere’ of the store, forms a first impression, filters the products available, analyses the services and after all this peeling, in the centre, the holy grail of all retailers – the Purchase!

In my opinion, this ‘onion’ is perpetual, simply because customers expect it, anticipate it and desire it! Whereas for the digital customers, if the buffering screen pops up you’ve lost all chance of Purchase!

The transformation of brick-and-mortar stores through technological advancements assumes that technology will help us create a better customer experience. For example, the insights provided by Big Data, as well by the biometrics that start being implemented [Source]. The augmented reality devices designed to help customers make a purchasing decision [Source]. However, the core customer journey will still take place in the brick-and-mortar stores. It’s like Disney, we come back again and again even after fifty years!

This post is brought to you by one of AQ’s Undergraduates, Laura Susnea. As part of our internship programs, undergraduates and classic interns are encouraged to take part in company culture. Laura’s primary project focusses on training programs and eLearning and how best to adapt this to industries under pressure. 

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[Intern Insights] Digitolution: Is digitalization truly green?

Most people have a positive reaction when they see ‘digitalisation’ and ‘environmental sustainability’ in the same sentence. It’s the same feeling we get when encouraged to “go paperless and save trees!”

It’s true, digitising data saves trees. That’s a good thing. However, we all know that the true motivator for most corporations is the bottom line. Honestly, though, we don’t really mind whether they truly care about ‘going green’ because it’s good for the environment.

In addition, IT innovation, digitisation, digitalisation, allow us to cut down on our personal energy usage. It’s a fact that our society has moved to a cloud-based information storage and streaming system. Consider: emails instead of regular mail, conference calls instead of flying in, or online streaming of music and movies instead of taking up space on a physical hard disk, and so on. What great times we live in! All that aside, however, there is little understanding of the negative implications digital actions really have on the environment.

While opinions are divided about our society going digital, we all feel that at least it’s beneficial for the environment – namely, because we assume that digital is greener than paper. Despite the information available, we often turn a blind eye to the unintended consequences of society’s digitalisation.

One of the main points of digitalisation – aside from making our lives easier – has been about reducing our carbon footprints. However, when going digital, we actually create a “digital carbon footprint”.

People often imagine that saving data somewhere ‘on the cloud’ is purely virtually, while in reality the data is stored physically. And the carbon footprint of this physical storage location, the data centre, should not be underestimated!

These data centres can vary from a small room to huge cloud server farms bigger than a soccer field – are not too old yet. In the beginning, the main focus for operators was keeping up with demand. Being energy efficient was not a priority. Today, when setting up one of these centres, issues surrounding sustainability are taken into account more and more [Data Knowledge Centre, 2016].

Still, there is a lot of room for improvement.

The centres consume an incredible amount of energy, as they require a steady flow of electricity to run the servers, no matter the demand. Only 6 – 10% of this energy is actually used, the rest is kept in case of a surge or crash. Spikes for servers hosting data related to online shopping, for example, happen during Christmas times, when all want to buy presents.

In addition, servers need to be cooled down constantly. According to Greenpeace, 50 to 80% of energy comes from coal-generated power – the thought of this is so contradictory, using coal power to keep the digitalisation of society moving forward.

What’s more, the NY Times stated that a single data centre can use more power than a medium- size town and that worldwide data storage uses as much electricity as the output of 30 nuclear power plants.

This creates CO2 emissions. In fact, The Independent wrote that data centres are responsible for 2% of the global CO2 emissions, that’s about the same number of emissions coming from global aviation, and this number will increase! Think about the fact that 2 years ago, 90% of data did not exist! (Mallach, E., 2016).

Besides all advantages innovations such as the Internet of Things, digital supply chains and so on bring, the amount of data that will be created is huge. The Independent further stated that considering the fact that innovations in hardware allow an increased capacity to store data and assuming that a switch to renewable energy won’t happen that fast, it’s still predicted that in the next decade, data centres will use triple as much electricity as today.

So, whilst writing this article, I did not support the environment.

Our seeming to be harmless everyday actions sum up and foster global warming. Whilst sending a text message, streaming movies or music, commenting on social media, we all increase our carbon footprint.

I’m not saying that watching an old-school DVD is greener; it’s hard to compare options with so many factors in play, such as if the DVD is picked up by car and so on. I’m just personally astonished that my online activities are not as green as I believed.

To give examples:

  • One Google search produces around 0.2g of CO2, that’s about the energy used to heat half a cup of water.
  • Sending out 65 short emails is equal to driving an average-sized car for 1km. Even if I do not send out 65 emails a day, I certainly receive too many useless spam mails. An unopened spam mail produces 0.3g of CO2, more than a Google search. This means that the global carbon footprint for spam is equal to emissions produced by 3.1 million passenger cars that use 7.6 billion litres of gasoline yearly.

It’s not only our personal use; businesses shifted to “the cloud”. It’s easy, allows real-time online collaboration between people and gives access to real-time data worldwide. And let’s not to forget, it reduces licensing and purchasing costs for hardware, software and servers.

The good news is that social, economic, environmental and political pressure are pushing big players to publicly commit to using renewable power and reduce both their physical and digital carbon footprints. However, it’s also the countless numbers of small centres that add to the problem. Furthermore, it’s very hard to measure the global carbon footprint that digitalisation leaves behind.

If data centres continue to use coal power or will switch to renewable energy will impact on global warming. A switch to renewable energy definitely would boost investments and thus innovation for green energy.

This post is brought to you by one of AQ’s Undergraduates, Alexa V. As part of our internship programs, undergraduates and classic interns are encouraged to take part in company culture. Alexa’s primary focus is in digital marketing.

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[Intern Insight] Imagining the Future: How Retail Industry Customization Might Evolve

The retail industry is by no means ‘new’ in the general economic landscape. Ever since humans became conscious, developed opposable thumbs and learned that they could use them to create tradable objects, retail started to ‘boom’. It evolved from the Neanderthal trading venison with Homo Sapiens for sturdier clubs, to the beautiful ball gowns tailored specifically for each lady in the glamourous court of France’s Louis XIV. What was the competitive advantage? Easy answer: customization.
Jumping a few centuries forward, the Industrial Revolution enabled us to create more, better and faster. Amidst all these benefits we celebrated the ‘death’ of customization. With the birth of mass production facilitated by assembly lines, we witnessed a levelling of social classes economically as well as socially. After all, we still define ourselves by the objects we own.

Now, customization is back with a vengeance. As we say in Romania – bear with me, the translation isn’t all that easy –  ‘the wheel could even be square but it would still turn at least once more’! We tried so hard to revive this practice of personalization when yet another revolution came to the rescue. This time The Technological one! Digitalization, mobile development, 3D printing… These things have radically changed the retail environment, and have gone a far way in helping to deliver customized products and services.
Will we repeat our previous mistakes?
The Industrial Revolution gave us two alternatives: ‘more and faster’ or ‘customized and slower’. The Technological Revolution transforms these alternatives into one cohesive package: ‘more, faster and customized’. After all, today’s Homo Sapiens is far more complex, and, some might argue, a lot greedier… So, say in 100 years, how will this package evolve?
To answer this question, let’s take a look at three major trends affecting the retail landscape:

  • The rise of the online shopping and its supremacy over brick-and-mortar stores, that gave birth to the omnichannel practice (Lunka, 2015).
  • The shift in the general mindset of the customer towards ‘caring’ for the environment (Nielsen, 2014).
  • The appetite for the luxurious and exclusivist experience (Deloitte, 2015).

So, on top of it being ‘more, faster and customized’, we now also want it to be ‘online, sustainable and luxurious’. We’re not picky at all!

Well, do not fear! I have a solution!

Let’s do an imagination exercise together. It’s December 2116. We wake up, we wash our face, we check the news – which, of course, is displayed on our ‘smart’ mirror (Internet of Things, and all that). We want to dress for work. Maybe a Louis Vuitton skirt, a Chanel blouse, some Gucci shoes, a Burberry scarf…top of my head! Oh, and I forgot, we belong to the middle class.

Most importantly, all these items must be customized for us! I mean, maybe we don’t like our neck so we need to have a specific collar shape for the blouse. We are neither too tall or too short, so the skirt length cannot be universal. The soles of our feet are quite flat so we need orthopaedic features integrated into our Gucci’s.
Now, imagine that we have this robot assistant and all we need to do is to click on the preferred clothing brand and model. This robot measures our body in that specific moment – I don’t know, maybe you gained some weight from one day to another. Then it sends this information to the 3D printer, which uses recycling textile material to print out the clothes, in the desired shape, pattern and colour. Then we go to work, look fabulous and when we come back we can recycle our clothes in order to create new ones the next morning. It’s like shopping every day!

Also read this article: Retail Customer Service: Reality of Retail Industry

So, what are we going to pay for, you might be wondering? For the specific design for that specific brand. After all everything is shifting towards intellectual property! Why not retail? It won’t be long and we will see the ‘Spring/Summer Ready-to-wear Collection’ package on Amazon-like platforms. And if we want the real, live experience? We can go to the flagship store. It would be like visiting the Louvre. Glamorous, educational and spectacular in the sense – ‘Was it really this way clothes were made in the day?”

This is just a picture of the future.

Turning back to the present, the truth is, we are witnessing the rebirth of customization. It has a new shape, a new feel, but it’s there and it will always be waiting for us.

This post is brought to you by one of AQ’s Undergraduates, Laura Susnea. As part of our internship programs, undergraduates and classic interns are encouraged to take part in company culture. Laura’s primary project focusses on training programs and eLearning and how best to adapt this to industries under pressure. 

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[Intern Insight] Just Google It

Just “Google” it

Honestly, I think everybody said this, or it has been said to them at one point in their lives. I mean, every time you quickly want to know something, you go to Google, right? It’s the easiest way.

Have you ever actually counted how many times you “google” something per day? Yeah, I put it quotation marks, as “google” is actually a recognised verb now, since it’s used so often. Crazy how this verb really became part of our society.

Truth is, I don’t think we want to admit it but WE CANNOT LIVE WITHOUT GOOGLE. Google saves my life at least several times a day.

I can hear you thinking: “Well how many times is Google used then in our daily lives?”

Google now processes an average of over 63,000 search queries every second , which is about 3.8 million per minute. This translates into over 5.5 billion searches per day and about 2 trillion searches per year globally. WOW. Yeah, I googled that. Ironic, isn’t it?

Let’s think about our parents for a second, they didn’t have Google. Can you imagine high school without Google? I couldn’t. How else would you write your reports? I mean, they did it all with books and – depending on how old you are – with the worldwide web – yes, Gen Z, that is was WWW stands for. They actually had to really, really search for the content for their reports, in analogue libraries. Using these things called ‘card catalogues’. Don’t ask me, I don’t know how they work either.. Amazing.

Google was founded 18 years ago, by Larry Page and Sergey Brin, while they were Ph.D. students at Stanford University. I bet these guys were just really tired of continuously looking through the “World Wide Web” or those card catalogue things for information. You have to admit, it is quite an extradentary thing to have set up – Google, I mean, not the card catalogues.

Last time, I wrote about videos that give a more meaningful, immersive and better learning experience. Now I am wondering what influence Google plays when it comes to the way we learn. Does it actually support the learning process or does this overload of information only distract our brains?

Again, lots of research is done on this. And well, shocker, the results are divided.

Some researchers have argued that the easy access to information actually really stimulates our brains, giving us the opportunity to focus on other skills. Steve Pinker, a Harvard Psychology professor, reaffirmed this by stating that the Internet and technological advancement are truly the only solutions that keeps us human beings smart. Would you agree on that? Personally, I’m not so sure…

On the other side, you also have those that argue if instant access to information via search engines has a negative effect. Research from Kaspersky Labs has even found that we are increasingly forgetting information, because it’s all stored in external memory – like our smartphones. For example, do you know all the birthdays of your closest friends by heart? If you do, great. I often hear people saying things like: “If not for Facebook, I would have forgotten it was her birthday today.”. This is called ‘digital amnesia’ and it’s rising. A little over a decade ago, people could remember each other’s phone numbers – now? It’s once again stored in our phones. People are ready to forget important information because they know that they can retrieve it from a digital device with internet.

What we can conclude from this is that we have learned to rely on Google rather than on our own memory, particularly when it comes to storing long-term knowledge. The fact that we are able to access information wherever we like, has a negative impact on our motivation to actually memorize information for later on. I mean, why would we? We can find it again in a split second. People with iPhones don’t even have to type anymore, they can just ask SIRI. And now Android isn’t too far behind with that either!

Truth is, Google makes our lives easier, there’s no denying that, but it has also changed the way we think and remember. Without realizing it, we’ve become Google-dependent. It has replaced our need to memorize details. These new habits, using Google for almost everything, interfere in the development of our deep and conceptual knowledge. That aside, I don’t think I have to tell you this, but the internet is full of incorrect information. So, you are never completely certain if what you actually googled is the truth? Maybe we should just go back to card catalogues after all…. Nah, just kidding.

Secretly, I think we are all a little troubled with digital amnesia, also known as the Google Effect…

This post is brought to you by one of AQ’s Undergraduates, Paula van Staalduinen. As part of our internship programs undergraduates and classic interns are encouraged to take part in company culture. Paula’s primary project focuses on training programs and eLearning and how best to adapt this to industries under pressure.

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[Intern Insights] Digitolution: The impact of digitalization on the future

That the Internet, digitisation and digitalisation have changed the way people live and do business is old news. Those changes won’t stop.

To clarify, the differences between digitalisation and digitisation: digitisation is the process of converting information into a digital format, whilst digitalisation is the way many areas of social life are restructured around digital communication and media.

The big question mark giving business leaders headaches and sleepless nights is how these changes will evolve. As things progress, the impact on businesses and society and the implications for the planet change too.

We know that the future is uncertain. This is why businesses always need to stay on the edge. Walking the path between stasis and forward momentum allows businesses to avoid complacency.

Digitalisation makes sticking to a business strategy much harder. In the blink of an eye, all success can vanish because of a new digital innovation that seems to have miraculously popped up overnight. Digitalisation innovates entire systems, not only a product or service.

In an article for Forbes, Rich Karlgaard compares digital technology to a Death Star. At first, it pulls a company into its orbit and wipes out the old and well-established business model. Its next step is to force the business to adapt to the new digital environment laws of the game. Not just once, but over and over again. These “orbits” are unpredictable and can change societies in ways we can’t even imagine. Digitalisation and technology affect all aspects of our daily lives and are not only related to one area. They range from nanotechnology to 3D printing and all the interplay between. The combination of all these makes digitalisation an unstoppable force.

Most businesses are aware of the constant need to adapt to digitalisation and its changes but few realise how little time they have to do so.

The pace of digitalization is increasing exponentially. However, due to the – mostly useful, but in this case, not so much – inherent survival instinct, people think in linear growth.

To highlight the exponential growth and speed of those changes, just think back 10 years and see how much the world has changed.

10 years ago, I bought my first very low-resolution, colour mobile phone with a side-kick alphabetic keyboard. I was sad that I could no longer play the game Snake, which I had had on my previous phone. The media predicted what the first iPhone would look like. I imagined a kind of an iPod phone with a big round wheel to navigate; it took me a while to understand the concept of an application.

To buy this phone, I had to travel pretty far. I also entered several different stores to get different advice on which phone is the best and where to get it for the best price. Today, comparing and ordering can be done conveniently online – with a phone.

Terms such as Social Media, Facebook, YouTube and so on – the list is endless – were fairly new back then. Nobody could have imagined how those inventions changed the way people today interact, socialise, communicate, and work with another.

Every part of our lives today is digitalised. Business operations, products, and even customers are digital. Nevertheless, business leaders often still don’t think in “digital terms”. They struggle with the loss of customer relationships and the need to engage with their stakeholders on a digital level.

What Charles Darwin said in the 19th Century about evolution is also what businesses need to keep it mind today.

“It’s not the strongest of the species that will survive, nor the most intelligent, but the one most responsive to change.”

Today, the size of a business doesn’t matter, it’s agility and the capability to re-invent themselves that gives companies a sustainable advantage to compete in a digitalised world.Digitolution: Digital evolution is such a strong force, constantly reshaping the world with an incredible speed – affecting everybody’s daily life – that it deserves to be a word on its own.

This post is brought to you by one of AQ’s Undergraduates, Alexa V. As part of our internship programs, undergraduates and classic interns are encouraged to take part in company culture. Alexa’s primary focus is in digital marketing.

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