Exactly what is innovation? Here is what I think it means in retail:
Innovators break through barriers.
They use ingenuity to overcome obstacles.
They don’t play by the rules.
They crack problems.
They are unafraid to assume risk.
They fail forward.
These are important to think of as being on one end of a spectrum and on the other are such characteristics as evolving over time, making incremental gains, doing a good job better, and continuous improvement.
While useful, these are everyday goals. They should be part of everyone’s job description (or life mission) but in themselves they will not guarantee a retail organization will succeed today.
Up Close and Personal Tech
At the upcoming Retail Experience Summit, (RES) which is hosted by RIS, innovation is one of the event’s primary themes. The focus begins on day one with the first session, which is called Tip of the Spear Technology. (Click here to find out more about RES.)
In this session, retailers will see, learn and test drive cutting-edge technologies presented by 10 startup companies dedicated to the retail space.
Keeping abreast of startups has become essential for both individual and corporate success for retailers today. In the Tip of the Spear Tech session retailers will get an ideal opportunity learn about a broad range of emerging technologies in the following key areas:
- Optimizing shopper returns
- A new platform for automating and managing text campaigns
- Advanced online search
- Coin currency digitization
- Retail shelf analytics platform
- In-store navigation
- In-store robotics
- Video analytics
The session is hosted by i2i Labs, which is based in Rogers, Arkansas, a location close enough to the Bentonville headquarters of the world’s largest retailer. No doubt, there is a reason why i2i is located there and why it is home to a thriving technology ecosystem.
The founder of i21 Labs, Bryce Paden, calls his company a “tech commercializer” instead of a startup accelerator, which drills home the point that there is no magic to a startup unless it becomes a commercial success and delivers benefits to its clients.
The same is true for innovation, in general. It is not magical unless it produces measurable success.
Retail Innovative Case Studies
There are many examples of retail enterprises breaking boundaries, taking big risks and delivering positive results. A few of these include:
- Target didn’t wait to build the innovative technology it needed to solve last-mile delivery inefficiencies. Instead it bought an emerging startup Shipt in a bold move that brought the mass merchant a robust last-mile ground game and AI-powered software with a large database of highly accurate shopper profiles. With Shipt in-house, Target is set to create retailing’s first national same-day delivery service.
- What is truly innovative about the Amazon Go store is the work it did to create highly accurate computer vision. The secret sauce in this project is a massive amount of AI, machine learning and a long lists of specially created algorithms, which were needed to accurately identify products, validate purchase behavior, and assign purchases to the correct shopper. In the process of writing these algorithms, Amazon decided that AI was so important to its future that AI must permeate everything it does company-wide.
- Nike’s new Melrose store in Santa Monica represents a bold shift to a data-driven, hyper-local approach to product assortment based on the purchases and behavior of loyalty program members in surrounding zip codes. Not only are purchases factored into the algorithms but also such other factors as mobile-app searches and engagement at the store’s Sneaker Bar (a lounge area), Fit Zone (fitting rooms) and Trial Zone, where shoppers test sneakers by running on a treadmill or dribbling a basketball.
- Walmart just announced it is bringing robotic automation to its super centers to improve click-and-collect efficiency and reduce the growing burden of omnichannel labor requirements. Large stores will be fitted with 20,000-square-foot extensions and Alphabots (robotic carts) that retrieve high-velocity products and then transport them to associates who will complete final processes and deliver them to customers.
- The new Container Store flagship in Dallas, which will feature 18 shoppable interactive screens, will support customers as they shop for complex solutions to home improvement. By deploying so many interactive digital screens, the Contain Store enables shoppers to do their own searches and problem solving, and, if they choose, to work with associates to create collaborative designs using photos and/or videos from their own homes.
Innovation is not important for innovation’s sake. Nor is it synonymous with technology. Innovation is only important if it makes shopping easier, more convenient, and more fun for the customer.
To be effective, innovation needs to become part of a retailer's DNA just as it is in a retailer's DNA to create a great customer experience. When those two things converge you will deliver a powerful result.