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5 ways 5G will impact retail

Last month, mobile phone network Three ‘switched on’ its 5G service in London through an immersive experience with fashion designer Henry Holland.   

The “Living Room of the Future” initiative saw visitors able to try on mixed reality headsets from Magic Leap, to enter into a world consisting of everything from a mindfulness moment, to a gaming experience and the delivery of (virtual) House of Holland shoes by drone to your door. 

5G is expected to ramp up in 2020 on a global level. Further cities in Switzerland, Spain, Germany and Italy have already begun adopting it. Meanwhile, in the US, although four cities have turned on the signal, the technology is tied up in a trade war, since China’s Huawei is the dominant 5G supplier. Regardless, the latest Ericsson Mobility Report predicts there will be more than 10 million 5G subscriptions globally by the end of this year, and that 5G population coverage is forecast to reach 45% by 2024.

In it simplest sense, 5G is just a faster version of 4G – about 20x the speed in fact. That coupled with almost no latency, means the new networks will nearly eliminate lag time. This is big news for mobile of course – opening up paths to purchase in even the busiest of crowds for everyday shoppers. 

But its existence will also help power other tech advances, from machine learning to digital realities. Add in features like low energy consumption and higher reliability, and it brings an opportunity for the retail industry to enhance the consumer experience in the physical store with a number of seamless real-time functionalities, leading to increased engagement and conversions. 

As a result, now is the ideal time for retailers to start planning how their stores and interfaces will look when 5G becomes widely available. Here are 5 ways we see it having an impact… 

Connected Spaces

Connectivity in our physical stores, means devices that can constantly exchange data with each other – also known as those under the header of the Internet of Things (IoT). To do so, they need a fast, reliable network that doesn’t require too much power. 5G networks will achieve a 90% reduction in power consumption, guaranteeing up to 10 years of battery life for low power IoT devices. This means, for example, that more retailers will have access to smart shelves like the ones Amazon implemented in its Amazon Go stores. This technology uses dozens of sensors to provide real-time inventory visibility and update pricing according to demand. 

Key tech we’re tracking: dynamic pricing, automated checkouts, connected fitting rooms, automatic replenishment

Amazon Go Store
Immersive Experiences

Augmented and virtual realities use a lot of processing power and cellular data. With the increased capacity of 5G networks, retailers will be able to create richer, more detailed experiences when integrating their physical and digital worlds. This will make technologies that we’re already experimenting with, and seeing consumer adoption of, only more of a possibility. The result will mean shoppers are able to immediately check product materials or ingredients through the use of smart glasses or their smartphones, for instance. Those same apps will also guide customers to the products they want by projecting directions into their field of view in real-time as they navigate the store space.

Key tech we’re tracking: immersive interfaces, gamification, wayfinding

Puma’s new flagship store with gamification
Higher Efficiencies

Artificial intelligence will also thrive on IoT devices via 5G. That’s not to say the AI algorithms themselves will change, but that the higher network will enable more accurate real-time data to flow, ultimately facilitating smarter systems. In retail, for instance, managers will be able to delegate more operational and inventory decisions to automation. This means greater efficiencies as well as accuracies on things like forecasting inventory quantities so as to optimize stock levels, leaving sales associates to spend more time on customer care. Having stock in the right place at the right time will also decrease the risk of losing customers to competitors, as product availability will be more accurate. 

Key tech we’re tracking: retail analytics, inventory visibility, demand forecasting, endless aisle  

Walmart’s endless aisle
Personalization

With lower latency, retailers will also be able to respond to purchasing patterns and behaviors with immersive, tailored content in real-time. Implementing 5G in-store will allow for greater interactions and data collections between sales associates and customers. Real time data could be tracked to create personalized adverts or offers based on the preferences of individual customers, helping to increase the incentive to buy. 

Key tech we’re tracking: marketing automation, personalized promotions, AI recommendations, product search tools, clienteling

Nike’s Melrose store
Fulfilment

The implementation of 5G will also revolutionize logistics by improving  efficiency in fulfilment tasks and increasing the speed of transportation. Greater connectivity and improved reliability will help communications between brands, couriers and consumers. The full capacity of 5G will eventually also enable the roll out of automation in transport and warehouses, thanks to improved processing of the vast amounts of data required in real-time. 

Key tech we’re tracking: smart warehousing, robotics, automated vehicles

Lowebot assisting a consumer

Additional reporting by Larissa Gomes.

How are you thinking about retail innovation? The Current Global is a transformation consultancy driving growth within fashion, luxury and retail. Our mission is to solve challenges and facilitate change. We are thinkers and builders delivering innovative solutions and experiences. Get in touch to learn more.

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business data Editor's pick technology

Cambridge Analytica whistleblower on the trends connecting fashion and politics

Christopher Wylie - Cambridge Analytica
Christopher Wylie

The similarities between fashion and politics are much stronger than people think, says Christopher Wylie, now widely known as the Cambridge Analytica whistleblower, in an exclusive conversation with Vogue Italia.

Why is someone who blew the lid on the Facebook data scandal talking about fashion? Canada-born Wylie was studying trend forecasting at the University of the Arts London while working at Cambridge Analytica, and has spent much of his career exploring links in culture.

Much like fashion trends, politics is cyclical, and encompasses the idea of presenting an aesthetic, or narrative, he explains. “Trends are just as important in politics as they are in fashion; just that rather than an aesthetic trend, it might be an ideological, behavioural or cultural trend,” he says. “You need to keep track of all kinds of trends in politics because you need to know if you come out and say something, what the adoption of that will be six months down the road. And is that going to help you win an election.”

Given the nature of his role at a data business, unsurprisingly he also has a big view on the impact of artificial intelligence and machine learning on the fashion industry too.

Fashion’s intuitive nature is not only hard to measure in trends, but also incredibly complex for machines to learn, he explains. He believes fashion is contextual because its trends and aesthetics are hard to quantify. “How do you define bold? If I go to a black tie dinner but I’m decked out in camo, I’m actually wearing quite muted colours, but it’s quite bold,” he exemplifies, saying boldness is contextual, depending on where you are.

“How do you tell a computer about that? Amazingly, with fashion, is that not only is it visually and aesthetically really enriching, computationally and mathematically it’s really hard. It’s a hell of a lot harder than politics.”

Computer vision could be the solution, he says, because an outfit is essentially visually-encoded information. In that sense, it is human beings who would need to look at pictures of people wearing clothes and choose the relevant adjectives that describe what they look like. They then need to work closely with computers to teach them about fashion.

“Everybody needs teaching, even computers. You learnt fashion in the first place, so the computer needs to learn fashion from people as there are no machines that know fashion yet,” says Wylie.

Digital influencer Margaret Zhang wears Vetements
Digital influencer Margaret Zhang wears Vetements

We saw this movement towards focusing on the human earlier this year at SXSW. While every conversation was underpinned by the concept of artificial intelligence, the topic kept highlighting the sense of instilling humanity in all interactions – from robots learning from humans, to humans being freed from minimal tasks to focus on what matters.

Another strong theme from SXSW – and one permeating consumer trends full stop today – is around the lack of trust in society. The Edelman Trust Barometer has reported a straight-line decline for 25 years, and Wylie likens the rise of ironic fashion such as Vetements to this too. “If you have a lot of designers who are starting to make stuff that is ironic – or stupid like the €200 DHL t-shirt – and people are buying it, it’s because you have a total collapse of trust in institutions, including fashion institutions,” he says, adding that this is where fashion and culture in general have a lot more power than they give themselves credit for.

The Vogue Italia interview otherwise covered Wylie’s involvement in the Cambridge Analytica and Facebook data scandal more broadly, and exactly why he decided to go public with the information.

For more on the future of data regulation and privacy, listen to our episode of TheCurrent Innovators podcast with Amnesty International’s Sherif Elsayed-Ali.