Highlights from London Tech Week 2018

The Coresight Research team attended London Tech Week held June 11–17. In this report, we highlight our key takeaways from the various retail-tech events we attended during the week. A follow-up report will focus on some of the notable startups we met.

1. VR: The Client Experience VR Provides Can Make Brick-and-Mortar a Key Component of Shoppers’ Multichannel Experience

In a panel discussion session entitled “Reinvigorating the way retail spaces use VR,” Carin Campanario, Technology Innovation Strategist at travel operator TUI Group, and Alex Harvey, Creative Director at creative agency Infinite Pixel, developer of TUI’s VR experience, discussed the use of VR in TUI’s stores. TUI has adopted the technology to offer a better shopping experience to customers, not just as a “nice-to-have” tech gimmick. By offering a virtual holiday experience through VR, TUI aims to give customers visiting its stores a preview of the vacation they are considering going on. The idea is to replicate what traditionally happens in other outlets such as bookstores, where shoppers can flick through books to get a taste before buying. TUI uses VR to add a storytelling aspect to the shopping experience and to show customers that their planned holiday is all about them having a good time. Both Campanario and Harvey view VR as the future of the holiday brochure. Shoppers can virtually visit the exact hotel room they want to stay in. VR empowers staff with a tool that makes selling easier, by convincing clients to try out new holiday experiences. Sales have generally gone up since the company adopted the VR technology, said Campanario.

2. AR: Retailers Should Use AR to Stand Out and Make Store Visits More Memorable

In a session entitled “AR with purpose: How to make customers open their wallets,” Matthew Cockerill, Head of Studio at creative agency Swift Creatives, discussed how AR adoption in retail needs to come with a clear purpose in mind. Storytelling is a key goal for adoption of AR in-store for retailers. Adopting the technology should serve to make the store visit memorable as well as make the retailer’s offering stand out versus competitors. One example given by Cockerill was of a Scandinavian furniture retailer that adopted AR in its Shanghai store to emulate a snowy Scandinavian environment. When looking at AR, companies need to consider whether there is a consumer need that can be met by AR as well as the likely acceptance among users. They must also assess the commercial viability and their own tech capability, which means evaluating whether the company has enough financial and technical resources to make the adoption of AR possible. How past experience helps: Google Glass failed to take off because of shortcomings with customers’ needs and adoption, as well as because smartphones could also be used for the same tasks and as consumers felt uneasy about wearing the device in public. The Google Glass example shows the importance of finding a valuable use case. Smart glasses have since been adopted in labs or medical practices, where users need to access information and be “hands free” at all times.

3. Consumer IoT/Smart-Home Technology: Brick-and-Mortar Retailers Are Best Positioned to Become the Go-To Place for Smart-Home Technology

We also attended a panel discussion on how retailers are capitalizing on evolving smart-home technology. Panel participants included Tim Potter, Senior Product Innovation Manager at retailer Dixon Carphone, Matti Kahola, Senior Analytics, Connected Home Service Manager at research and consulting company Delta EE, and moderator Bill Ablondi, Director Smart Home Strategies at data and consulting firm Strategy Analytics. We are still at an early stage in the consumer adoption of smart-home devices and consumers need all the help they can get, said Potter. He believes that legacy retailers, rather than pure-play retailers, are best positioned to provide support because of the physical store network. Dixon Carphone stores offer demonstrations to customers on how smart-home devices work together and what they can do. Potter said that the retailer provides support for the installation of IoT devices and engages in activities to educate shoppers on smart-home systems to increase demand. Both he and Kahola agreed that customer support is key to encourage the adoption of smart-home systems. Kahola spoke about how home-improvement retailer Leroy Merlin developed an app to help customers connect and integrate IoT home devices. The app has been well received, helping to make the customer experience more straightforward as well as empowering store staff to help customers in a more effective way and to increase sales.

4. Back End/Operations IoT: Retail and Logistics to Deliver Customer Value Through IoT

At another event entitled “The IoT Revolution in Retail,” Patrick Razavet, Head of IoT at telecoms firm Vodafone, spoke about how IoT is changing the retail industry. IoT is part of the third of a series of technology waves that connected network nodes to the Internet: the first was about connecting computers, the second entailed connecting people through smartphone devices and the third is about connecting things. Infrastructure and hardware-heavy industries such as retail and logistics are among the main beneficiaries of this third IoT tech wave—the technology enables retailers and supply-chain firms to connect assets for enhanced operational efficiency, resulting in increased value for customers. The value offered to the end customer is what matters ultimately. Razavet reinforced the message that it is not the technology that matters, but rather the business outcome that the tech delivers, this was a reoccurring theme at many of the London Tech Week 2018 talks we attended. Razavet noted that IoT applications in retail include:

• Digital buildings: Sensors and CCTV for surveillance and energy management
• Digital stores: Ambient advertising, digital displays, digital fitting rooms and mirrors that recognize the shopper and provide a tailored shopping experience
• Logistics and inventory management: Supply-chain assets tracking to make delivery more efficient and shelves sensors to monitor inventory levels
• Smart parking: CCTV and sensors in parking lots to avoid congestion and optimize parking spaces, particularly at big out-of-town retail parks and malls

Razavet views IoT as an emerging trillion-dollar industry that could generate substantial new business and applications. And the emergence of 5G technology will enable connected objects to react promptly to external factors. For example, a self-driving vehicle will be able to react in real time to another vehicle moving towards its trajectory and avoid impact. IoT is considered critical by 76% of the businesses interviewed for Vodafone’s 2017/2018 IoT Barometer.