Global payments and shopping service Klarna released data last week showing how retailers should adapt to attract customers in the future. That means they would need to invest in artificial intelligence (AI), augmented reality (AR) and robots, which the study says are “likely to dominate the in-store and online landscape,” especially fashion retail.
The results are based on an online survey Klarna conducted in cooperation with the market research company Dynata in April 2023 in five countries – USA, Great Britain, Germany, France and Sweden – and in each country at least 1,000 people aged between 18 and 18 participated 77 years participated.
“In the Western world, about 80 percent of all online purchases are made through search, with the remaining 20 percent based on personalized recommendations. In contrast, in China, 80 percent of online purchases are made through personalized recommendations. This study confirms that consumers in the western world want a comparable shopping experience, which is now available in the Klarna app feed, powered by AI and purchase history data. The next generation of consumers will expect a highly personalized shopping experience, where products find them and not the other way around,” commented David Sandström, Klarna’s Head of Marketing, in a press release.
Although no country-specific data was available, the survey results are fairly clear on how technology will change shopping habits 18 years from now, in 2041. Then Klarna will be 36 years old or the consumers of Generation Z will be 40 years old and together with the Millennials will make up the dominant consumer group. Here are some of the expectations that respondents placed at the top of their wish lists:
personalization
Almost two-thirds (65 percent) of respondents would like the shopping experience to be more personalized in the future, and more than a third (36 percent) are even certain that this will be the case, both in-store and online.
Never try on clothes again
Consumers seem fed up with physically trying on clothes – waiting for a fitting room, having to change in cramped spaces, trying on different sizes, and the like. Almost half (48 percent) want to use virtual dressing rooms, 28 percent want AR, and 23 percent would rely on AI. For example, to get advice on which clothes best suit their body type and fashion style. However, just over half (53 percent) also think they would try on clothes the same way they do today.
Robots are in
When it comes to fashion advice, “well-mannered robotic fashion consultants and virtual personal shopping assistants are in high demand,” according to the study. More than half (59 percent) of respondents are open to the idea of having a robot approach them in-store to take measurements and provide style recommendations, with another 18 percent considering it based on what the robot looks like and behaves.
Additionally, 34 percent of respondents would like access to virtual ‘personal shoppers’ who can make recommendations based on their fashion style and taste when shopping online.
AR to save the store experience
Augmented reality will enhance the future in-store shopping experience – the vast majority (81 percent) of respondents expect this, and more than a third (37 percent) even believe that it will eventually become the standard in retail stores.
“We live in times of great transformation and digital acceleration in all areas of society. As is well known, the focus is on artificial intelligence and the advantages and disadvantages that this technology will bring not only for companies and organizations, but also for end users. This also applies to the future of e-commerce, which we believe will be heavily influenced by new technologies, not only AI, but also virtual and augmented reality and, above all, IoT (Internet of Things),” confirms Bhupendar Singh , Head of D2C and Corporate Marketing at Samsung.
Real-life shopping will remain
It is important to know that virtual reality will not replace the real shopping experience. Less than half (43 percent) of Gen Z respondents believe virtual reality shopping will surpass physical shopping experiences within the next two decades.
Cash is out
Nearly two-thirds (64 percent) of Gen Z’ers and Millennials surveyed agree with the prediction that the majority of physical stores will be completely cashless in 18 years, and nearly a third (31 percent) of them believe this transition is already happening will take place in five years.
Circular economy is assumed
In addition to technological advances, the future of the planet and the growth of the circular economy are also at the center of consumer interest. “The younger generations also agree that the circular economy should take a larger share in the overall shopping behavior and that fashion must become more sustainable in the future,” the study says.
While 52 percent of respondents support more sustainable fashion in the future, 57 percent want the circular economy to take a larger share of the overall shopping industry and around a third believe they are selling (26 percent) and buying used items more often (37 percent) will.
AI predictions
Last but not least, Klarna had ChatGPT, the AI chatbot developed by OpenAI, answer the same consumer survey. Here are the results:
- In ten years, the majority of businesses will be cashless.
- AR will improve the shopping experience in physical stores in the future.
- By 2041, VR shopping will be preferred to shopping in physical stores.
- Delivery of online purchases will be fully automated by 2041, with the help of drones and robots.
- Robots and artificial intelligence will not replace human staff in stores.
“Retail and shopping trends have evolved significantly over the past decade and it’s clear more changes are on the way. Technologies like augmented reality have the potential to transform ailing physical stores and reshape the shopping experience for customers. Recent research from Klarna shows that consumers want more convenience and a more personalized shopping experience – and seamless technology needs to be at the heart of that,” summarizes Kate Hardcastle, UK consumer research expert.