SXSW was once the domain of music and film. Someone’s gotta buy all those super-skinny-jeans and coin terms like mumblecore. Enter retail. Retail has a growing presence at SXSW. Last year SXstyle joined the lineup - a nod to the collision of fashion, retail and technology. This year the festival brimmed with vibrant retailers and industry innovators from Neiman Marcus to Refinery29, all vying to showcase what’s coming in retail 2016 and beyond. Here’s what we found at SXSW16.
In one of the festival’s most crowded sessions, Jeff Xiong (ex CTO of Tencent, the makers of WeChat), Chris Messina (Developer Experience Lead, Uber) and Julia Hu (CEO, Lark technologies) spoke about the rise of ‘Conversational Commerce’.
Messina spoke of the frenzied activity in the communications and messaging space - from Facebook’s $22B purchase of WhatsApp, to the birth of text assistants like GoButler and Operator, to the development of voice assistant from major tech players - Apple’s Siri, Google’s Now, and Microsoft’s Cortana.
Above: The new Quartz iPhone app features a conversational interface
The investment suggests the beginning of chatty relationships with banks, utilities providers, media outlets, and retail brands. The advantage is clear: the brand with the best data wins. With chat, brands who gather more and more contextual information about their customers will leap ahead with superior personalization and recommendation capabilities.
Quartz is testing the conversational waters with a new app - it’s as if your hip friend were texting you the latest and greatest in current affairs. It’s a discussion, a ‘choose your own adventure’ spin on Quartz’s famous ‘Daily Brief’ newsletter. “There are ways to get value out of the app without even opening it” said Zach Seward, VP of Product at Quartz.
Festival culture is growing fast. Festivals spike social sharing, interaction and buying among the young, beautiful and influential - and brands want a piece of that action. In 2015, festival related searches grew by 11%, mobile data usage at Glastonbury exploded by 930%, and Google searches for Coachella 2016 tickets were being made just one hour after the 2015 festival concluded.
Neiman Marcus stamped its commitment to festivals in 2016 with an experiential SXSW pop up dubbed the “School of Self Expression”. The pop up hosted workshops by the likes of Kate Bosworth, a Neiman Marcus Dream closet that tweeted stop-motion gifs in real time, and lockers with trending tech products inside them.
Above: The Refinery 29 School of Self Expression, presented by Neiman Marcus
Nordstrom balanced interactions and transactions in their SXSW pop up pod. The pod offered beauty products and totes as well as cell phone charging stations and photo booths. The micro stores will also make an appearance at Beale Street in Memphis, Shaky Knees in Atlanta, and BottleRock in Napa over the year.
Outside of SXSW Hunter is rethinking its strategy to capitalize on its strong festival ties. The heritage brand ditched London Fashion Week in place of the ‘Festival Innovation Summit’ - a tech and market focused breakfast that brought together minds from Google, Live Nation and JWT to discuss how to build ongoing relationships with festival-goers.
SALES ASSOCIATE 2.0 (NOW WITH AI + SERVICE DESIGN)
In 2012 Doug Stephens predicted the future of retail would hold ‘less people, more performance’, meaning that cashiers and others performing routine tasks would be replaced by technology, leaving only people that can provide highly intimate service and experiences. This year, SXSW was alive with ideas on how technology is helping retailers reshape the role and duties of the sales associate.
Ex-Amazon product leader Orkun Atik recently launched AI-based shopping app Mona. In the panel session 'A Personalized Shopping Experience (Minus the Person)’ he spoke of the limitations of most existing recommendation engines that are organized around relationships between products (think of the typical ‘if you like that, you might like this’ suggestion). He explained that the next frontier is personal, two-way engines that link a customer’s unique preferences with the products and services being sold. AI will be supported by human experts behind the scenes to create a future that leans less on search and more on targeted suggestions that strike at the right moments.
Atik emphasized that AI is just technology. Retailers must incorporate design and people to blend smart suggestions into customer behavior to overcome learning curves and avoid being creepy. “The easiest way to personalize is to ask” he said, “give people choices that allow them to personalize their own experience”.
So that’s a wrap from SXSW. The brand activations in the form of tattoo parlors, giant Ferris wheels and virtual reality Happy Meals have packed down. What are your bets for what’s big in retail 2016?
Disclaimer: The statements and opinions expressed in this article are those of the author(s) and do not necessarily reflect the positions of Thoughtworks.