Consulting Group. All rights reserved. Key in-store trends shaping the future of retail stores, putting customer experience and efficiency centrally Customer experience trends Enabling innovations Video analytics E.g., biometrics Shelf innovation E.g., AI in shelf In-store AI E.g., Amazon GO Mobile Apps E.g., Target App Changing store formats and store network Retail stores are here to stay, but no one-size-fits all approach, role of store is increasingly driven by customer's shopping mission Transactional stores • Shop & Go E.g., AH ToGo • One-stop-shop E.g., Decathlon Experiential • Showroom E.g., Dyson • Elevated service E.g., Nordstrom Local • Brand Immersion E.g., Apple store • Curated assortment E.g., Ikea urban store 1 Technological and digital innovations in-store Tech innovations across customer journey (discover, in-store & after purchase) enable customer experience trends 5 Evolution of supply chain Innovations in supply chain allow to increase speed, availability and transparency, driving convenience for consumers Smart inventory mgmt. E.g., Amazon Ultra-fast delivery E.g., Alibaba Hema Pick-up options E.g., PUDO4 7 Hyper-personalized and localized propositions As data analytics evolved, retailers identified the value of data (loyalty, demographic & transaction data) Personalized offers (pricing & promo) E.g., Nike+ app Aisle navigation E.g., MapsIndoors Assortment customization 3 Partnerships, alliances and ecosystems Formation of alliances & ecosystems add speed capabilities, enabling to compete on core strengths Tech-led E.g., Google Carrier-led E.g., FedEx Retailer-led E.g., Ocado 6 Omnichannel integration and frictionless retail Integration of omnichannel experience in-store and removing any friction allows to take the next step in customer experience All-in-one App E.g., Starbucks loyalty, order & pay app Frictionless checkout E.g., Amazon GO Self-service E.g., self check-in at hotel BOPIS1/ROPIS2/ BORIS3 E.g., GAP 2 Overall efficiency important across the board With limited employee availability retailers need to think how to best deploy employees in-store several solutions, like HR planning, automated inventory mgmt., ... 1. Buy Online & Pick up In Store 2. Reserve Online & Pickup In Store 3. Buy Online Return In Store 4. Pick Up Drop Off points Additional services (incl. BNPL) Retailers continue to move into offering add-on services to customers, diversifying their portfolio Rental of goods E.g., IKEA pilot Financ. services E.g., Carrefour Finance Adjacent services E.g., BestBuy 4 Buyer credit E.g., Klarna BNPL