Happy New Year! On to 2021…bold predictions for a better or simply a “normal” year!

Happy first week of 2021! I hope you all had a safe, happy and most importantly healthy holiday season. While the latest trip around the sun has challenged us many ways, there is a light at the end of the tunnel and hopefully better times ahead. Better, simply meaning more normal times! But let’s look at some BOLD predictions for what 2021 might hold in store for us.

Blanket prediction, with multiple Covid 19 vaccines having been approved and now getting into arms, the globe will move towards controlling the virus and allowing the world to put this pandemic behind us. Let’s hope this comes to fruition sooner rather than later. But what else can we expect?

• Stores are not dead…they’re continuing to evolve. Okay I might sound like a broken record, and yes this trend is not unique to 2021. But what is going to be different is the impact Covid 19 had on retail as a whole and stores in particular. It has been well documented of how the lock downs adversely impacted physical stores, restaurants, bars and a plethora of service business that could not be done over Zoom, Teams or Google meet. From a retailer perspective, 2020 accelerated a number of store shuttering, by some accounts doubling the closures from 2019. While brands like GNC, Pier 1 and Chico’s are closing stores, you still see other players such as Amazon, Warby Parker, Bonobos, Indochino and Peleton opening physical locations. We are not seeing the end of the store, we are seeing the accelerated evolution of how the physical store is being leveraged. Yes it will continue to be used to attract and drive traffic to come in and acquire inventory. But will take on an ever growing role – service center (think Apple genius bar), a return center (look at Kohl’s and what they have done with Amazon) or a micro fulfillment node (look for grocers to push this usage). As we emerge from the lockdowns, savvy brands and retailers will continue to rethink and retool how stores fit into their overall strategy. They will not be blindly shuttering those assets.
• Sustainability and the circular economy drives consumer behavior. There is no doubt that what we saw in 2020 was a massive acceleration when it came to ecommerce. And with those mountains of online ordering creating a tsunami of goods being delivered to our front doors, this will invariably lead to a return tidal wave of coming the other way. The amount of returns and how retailers and brands will handle this volume is potentially more than a headache for the industry. Forward thinking retailers will see this as part of a larger theme – sustainability. Returns are a part of the circular economy that has been growing. It is not only the amount of product coming back into the supply chain, but also how retailers will strategically address this as their overall go to market. How do retailers and brands ensure that sustainability is not an afterthought but is integrated throughout the business? Consumers’ sustainability awareness, are deciding factors in how they spend their money. Retailers and brands need to keep this in mind with regards to how they approach all aspects of their businesses – from sourcing to returns.
• Automation gets closer to the consumer. Yes I know, the robots have been here for a while now. But we will automation start getting closer to the end consumer. Granted robotics have already made their way into our homes – see the Roomba. When it comes to our supply chains, automation has been a presence for decades. Starting on the manufacturing floor and now pushing into the sourcing, warehousing and distribution parts of the supply chain. Look for automation to push into consumer spaces in 2021. From sanitization robots keeping public spaces hygienic, robots focusing on security and automation that will function amongst the public to complete order picking or store replenishment. We will also see more usage of automation in the last mile fulfillment, from Kroger to DHL, companies will seek to leverage autonomous robots and drones, to get our stuff to us when and where we want it. Look for automation to become a greater part of our lives, from our homes, to how we get products delivered to our doors and when we are out in public. Hopefully this is not the start of Skynet…
• Not your parents’ point of sale. My first prediction is the store is not going away it is changing…same can be said about point of sale (POS). The days of static, fixed cash registers has long been eclipsed by mobile and cloud based POS. But even this is evolving. POS will become untethered. Only requiring an internet connection and digital interface, modern POS will occur almost anywhere these two tools are present. You might say, so what, we already knew this…but this will expand into social media. We are already seeing a surge into Facebook, Instagram and TikTok to allow for transactions to occur on these platforms. We are finally seeing it come to content via your television (I remember working on a report in 1998 while at Forrester talking about this possibility). We are not far from science fiction shopping where QR codes and other scannable objects will be sprinkled through out our physical world allowing us to interact and shop almost anywhere. Advertisement on a billboard, scan the QR code to purchase. Walking through a park and there is a nice flower arrangement in a planter, take a picture via the PictureThis app and connect with local florists that can sell you the arrangement or individual plants. Our “limitations” to participate in commerce will continue to crumble, as POS becomes omni present. Retailers and brands need to be prepared to service demand anywhere and anytime…in locations not imaginable a few years ago.

Let’s hope that 2021 proves to be all that we hope for. Especially with regards to a wide spread vaccine. Captain obvious comment – but the ability to spread the vaccine globally will be a massive driver to getting the Covid 19 nightmare behind us. Fingers crossed this continues to march towards reality in the first half of 2021. What we did learn from 2020 was the major shock to our system accelerated the thinning of the herd. It also will reveal with brands, retailers and supply chains are best prepared for 2021 and beyond.

Happy New Year to everyone. Here is to a boring and normal 2021.

Dropping a $0.10 on what to expect in the next decade!

Rather than simply talk about what we should expect in 2020, let’s look at what we might expect in the next 10 years! As we close out this decade there is much to be expected in the world of supply chain, retail and technology overall. So let’s make the call on what you should look for in the third decade of the 21st century.

• Are you a retailer? A brand? Who cares. We have been seeing this convergence for a while now, but the next ten years the evolution will be complete. Go to a Target or Costco and look at how much private label product is available. Costco’s Kirkland private label accounts for $75 billion worth of sales – a major catalyst for their growth. Or look at the number of stores from brands such as Aritzia and New Balance to name a few. We all know that brands have been able to go direct to consumer, digital has only accelerated this phenomena. The next 10 years will see this trend to accelerate and when we reach 2030 the only way we can determine if you are a retailer or brand will be via SIC codes. Bottom line, regardless of what your SIC code labels you as a retailer or brand, you will have to be hyper aware of the consumer, and how you meet her needs.
• Rise of the machines! Okay that might be a little too dramatic, but automation becomes the norm rather than the exception. My old boss – Ray Wang – made the prediction that the roaring 20’s will be the “autonomous decade.” 100% agree. I was penning the draft of the blog and then saw Ray’s piece! I need to get my content out sooner. Back to the prediction, look for the next 10 years to see a blurring line between automation and human action. From the warehouse to the manufacturing floor to delivery, machines and man will continue to compliment one another. While we will see some human roles being taken over by machines, we will also see new roles for humans as some of the tedious actions are taken over by autonomy. Whether it is greater robotics complimenting the worker on the factory floor, increased automation leveraged in fulfilling our orders or leveraging smart machines to get stuff to us (more in my next prediction) we are in for an acceleration of autonomous assets becoming integral in our day to day lives.
• The challenge of last mile delivery will have been solved, via the machine! Speaking of the autonomous decade! The challenge of getting goods into the hands of consumers, at a safe and profitable manner continues to elude the players in the industry. In 2030, we will wonder why we ever thought we needed products delivered in rigid windows. Rather over the next decade we will begin to enjoy flexible fulfillment on our time. As the last mile network becomes more evident and flexible, we will be able to enjoy receiving our goods where and when we want them. More products will be manufactured at that last mile, via 3D printing. This will redefine how we view warehouse. More autonomous options will be leveraged to deliver – think last mile drones and autonomous vehicles. Our homes will start to add not just mailboxes, but receiving bays for the autonomous delivery vehicles. This will allow for round the clock fulfillment to be offered. Imagine a drone being able to deliver your packages at 3:00am to a drop box in your driveway. As the glut of delivery vehicles places a greater strain on our existing infrastructure, governments will have to become less restrictive on how drones and other autonomous vehicles are leveraged.

• A new economic giant from Asia, but not China. India will assume its place as one of the global super powers in the next decade. According to the world economic forum, but 2030 India will be second globally behind China in terms of GDP. China is predicted to be at over $64 trillion with India at over $46 trillion, with the United States a distant third at $31 trillion. With China and India also accounting for over 2 billion people – some predict that India will over take China as the most populous country over the next decade. India will continue to keep the title of “world’s largest democracy.” As this democratic powerhouse continues to grow economically, look for that large swath of consumers to have their say in the global economy. Supply chains, manufacturing, products, marketing, etc will all have to adapt to this emerging consumer powerhouse.
• China will lead in facial recognition and other AI technologies. But their stance on issues such as privacy will lead to a backlash in Western democratic societies. Much like the issues Huawei has faced with expanding into territories such as the United States, an increasing number of companies coming from China will face similar hurdles. Much has been written about China and their usage of facial recognition from being able to monitor who is jay-walking to grocery stores that are going cashier-less via paying through facial recognition. The Chinese government will continue to push for expansion within the area of deeper AI. The question will become, how will this impact the ability of Chinese companies and technologies to expand into markets such as North America and Western Europe, where civil liberties and privacy are staunchly defended as important rights for their citizens. Just look at social media start up – Tik Tok. As a Chinese company, they are under greater scrutiny from Western governments wary of how privacy and data are being used. As China races ahead with such technologies as AI, their overall stance on data privacy will act as an anchor as to how far their companies and technologies can truly take hold globally.
• Socially aware retail becomes the norm. Rather than simply looking for the best deal, consumers will look to be more social aware when they are shopping. Whether it is for a garment that uses renewable materials, shopping for groceries that have a responsible CO2 footprint or a vacation that leaves a small environmental footprint. Savvy brands will provide clarity into how socially conscious their products and services are – clearly outline how products are manufactured, how they are moved and stored, the raw materials being used and even what will happen with the products that are not sold. But it will not be simply how they get product to market, they will look internally as well. Do their employees have to drive far to get to the office? Are they using renewable energy to “keep the lights on?” Consumers will demand transparency into all these aspects as they lean on this information when making buying decisions.

So the roaring ’20s will be an exciting decade. More robots, especially those delivering my latest Bonobos sports coat to my house at 4:20am. Asia will continue to rise as a global power center, but possibly led by the Tiger not the Dragon. 10 years is a long time. And when you add the accelerant of digitalization one can image how fast changes will be coming at us.

Happy New Year!

Happy New Year

Happy new year to all. May you close out 2012 with friends, family and loved ones. Here is to 2013 and a fresh start!

 

Happy New Year!!! Chinese style

Happy Chinese New Year to all…the year of the Golden Rabbit. Attributes of the Rabbit:

• Compassion
• Sensitivity
• Flexibility

Happy New Year to all!