According to a recent study conducted by Buy Now, Pay Later platform Klarna, consumers are eagerly embracing shopping technology. The study, titled “Future of Retail,” surveyed over 5,000 consumers across five countries and analyzed the potential evolution of the shopping landscape in partnership with retail expert Kate Hardcastle.
The research indicates that Gen Z, the upcoming generation of shoppers, will prioritize in-store shopping over virtual reality experiences but still long for technological innovations to enhance their shopping journeys. In fact, 81% of Gen Z individuals are expecting augmented reality (AR) to enhance their in-store shopping experiences. This reflects the preferences of future consumers as Gen Z and Millennials will become dominant consumer groups in the next 18 years.
Personalization is also a key factor for shoppers, with 70% expressing a desire for more personalized shopping interactions. Despite this, 42% of respondents believe that retail will continue to exist both online and in physical stores. Traditional ways of trying on clothes are also expected to change, with only 44% of Gen Z individuals anticipating using fitting rooms. Instead, 40% are interested in virtual dressing rooms, 18% prefer AR, and 23% are interested in utilizing artificial intelligence (AI) to receive fashion advice that aligns with their body type and style.
The study also highlights the growing demand for “well-mannered robot fashion advisors” and virtual personal shopping assistants. Half of Gen Z respondents are open to the idea of being approached by a robot in-store for measurements and style recommendations. An additional 21% are open to the concept, depending on the appearance and behavior of the robot. Furthermore, 34% of Gen Z individuals express a desire for access to virtual personal shoppers who can provide tailored recommendations based on their fashion preferences during online shopping sessions.
Both Gen Z (81%) and Millennials (75%) view AR as a means to enhance their in-store shopping experience. However, virtual reality (VR) is not expected to replace the in-person shopping experience, with only 41% of Gen Z individuals and 38% of Millennials believing that VR shopping will surpass traditional shopping within the next two decades.
The study also highlights consumers’ evolving environmental consciousness. Over half of the respondents from all generations agree that the circular economy should play a larger role in the retail industry. Additionally, 52% believe that the fashion industry should prioritize sustainability in the future, and almost one-third of consumers anticipate engaging in the buying and selling of pre-owned items more frequently.
David Sandström, Chief Marketing Officer at Klarna, drew parallels between the European and Chinese shopping experiences. Sandström noted that in the Western world, approximately 80% of online purchases are driven by search, while only 20% are influenced by personalized recommendations. In contrast, China’s online purchases heavily rely on personalized recommendations, accounting for 80% of transactions. Sandström added that the study’s findings illustrate a desire among Western consumers for a similar personalized shopping experience.
In conclusion, Klarna’s research suggests that consumers are ready to embrace shopping technologies and expect continued personalization in their shopping experiences. Gen Z and Millennials are key driving forces in shaping the future of retail, with a strong preference for augmented reality and AI-guided shopping experiences. Retailers will need to adapt and integrate these innovations into their strategies to meet the changing expectations of consumers. Sustainability and the circular economy will also play significant roles in the future of the fashion industry, with retailers that prioritize eco-friendly practices and pre-owned shopping options likely to resonate with a growing number of conscious consumers.
Useful links:
– Klarna’s Annual Global Shopper Survey Report: The Power of Social in E-commerce
– Retailers Looking Toward Technological Investment to Harness Millennial Buying Behaviours
