The Future Of Shopping

Napoleon once dismissed Britain as “a nation of shopkeepers.” The description is still apt, but if researchers are right there may soon be a lot fewer of them.

The Centre for Retail Research’s analysis of how UK retailing will change by 2018 predicts that total store numbers will fall by 22%, from 281,930 to 220,000 with over 300,000 job losses. The High Street will continue to suffer with around 41% of town centers losing 27,638 stores in the next five years.

The economy is not the only thing to blame. Shopping habits are changing radically as more people buy online or via their mobile phones. Indeed, the share of online retail sales will rise from 12.7% in 2012 to 21.5% by 2018, according to the Retail Centre’s 2013 report.

“There is a revolution going on,” says Paul Coby, IT Director at John Lewis, a British High Street retailer that opened it first store in 1864. Online-only stores such as the UK’s Net-aPorter are opening pop-up brick and mortar outlets. And retail stores are going digital.

John Lewis: ‘Is the technology adding something the customer wants? Is it going to help their shopping experience?’”

If pundits are right soon anything you have earned in the online or offline world will be digitally recorded and automatically deducted at time of purchase, no matter where you buy.

And, since payments are mobile, soon they will no longer be tied to old-fashioned cash registers, freeing sales assistants inside stores to help customers check out and pay from the aisle or the changing room, according to predictions made by PayPal CEO David Marcus.

Window shopping is set to take on a whole new meaning: city dwellers out for a stroll will scan items on mannequins with their mobile devices and click to buy and ship, even if the high-street store is closed for the day. And context-relevant location-based shopping experiences are expected to become the norm. In an aisle of men’s suits, for instance, a consumer could pick one out and the sensor on the garment would interact with the shopper’s smartphone to direct him to a nearby rack for a recommended accessory, such as a tie or a belt, including personalized content.

Re-imaging The High Street

A competition run by the UK’s innovation agency, the Technology Strategy Board (TSB), hopes to find new, technology- driven ways of reinvigorating UK High Street retailers. The first phase of the project, announced June 1st, includes £2 million in funding for 21 projects. The TSB will invest up to £6 million in a second phase. The value of individual contracts in the second phase will be up to £1.2 million.

Projects funded in the first phase include:

  • The Town Pound: A project that will trial the concept of a national network of local e-currencies. The project’s ultimate intention is to create a network of locally-branded currencies on each High Street. The project promises a range of benefits to retailers and shoppers, including one-stop online shops for each High Street and a click-and-collect service.
  • Beyond Clicks and Bricks: A partnership that includes Microsoft, Kent County Council and others, will trial augmented reality technology — allowing shoppers to point their smart phones at shop fronts and view tailored offers — as well as next generation retail ‘spot market’ technologies that allow shoppers to take advantage of targeted offers.
  • Targeted Offers: A plan to provide free High Street Wi-Fi in order to provide shoppers with details of High Street stores and deliver targeted offers, specific to the shopper’s position. The project also aims to boost the local economy by providing a support service for local retailers, helping them to develop their online presence and analyze local shopping trends.
  • Omnichannel Marketing: The project aims to attract additional shoppers to Leeds Kirkgate market, by developing an online presence. The aim is to ensure that the 157-year-old indoor market, where shoppers can find everything from fresh food and fashion to flowers, hardware and haberdashery, can match the convenience of large high street retailers. A 3D digital platform will map the indoor market and allow shoppers to navigate from home and click to collect.

In this new world merchandise and promotions must not only be consistent across all retail channels, adapting to consumers who want to use different channels simultaneously, brick-and-mortar retailers will need to personalize offers according to a consumer’s purchase patterns, social network affinities, website visits, loyalty programs, and other information gleaned through data mining.

Against this backdrop, John Lewis has decided it should bring innovation in from the outside, engaging with start-ups for the first time, via an incubator.

“We have no monopoly on good ideas. JLAB [its incubator] is about what we don’t know,” says Coby, the retail chain’s IT director. “It is about genuinely opening up to what tech can bring and opening ourselves to what customers want from us. We know our customers want to buy things and want a relationship with John Lewis and we want to give them as seamlessly as we can a great assortment of products across all channels.”

The company has made a good start on adopting an “omnichannel” strategy that blurs the lines between mobile, Web and HighStreet outlets, he says. But it needed to find an efficient way to interact with young tech companies on what’s coming next.

JLAB “was really born out of frustration and guilt,” says Coby. His inbox is always overflowing with pitches from start-ups. “I think every salesperson in Western Europe must have gotten my email,” he says. “There was frustration in knowing there was gold and uncut diamonds in all those emails and guilt because it was impossible for me to give them the time they deserve. What I wanted was to create a structure, an innovation funnel for all those great ideas.”

More than 200 start-ups applied to be part of JLAB. With the help of mentors, John Lewis whittled that number to five finalists.

The incubator is a chance for John Lewis to figure out if what’s hot in tech makes sense for its customers. Take the case of Beacon, a low-energy Bluetooth technology, which is being promoted as a way to offer real-time personalization and customization of offers for customers in-store. Coby is approaching the technology cautiously. “We have to look at how to engage customers in-store,” he says. “But I think we have to ask, ‘Is the technology adding something the customer wants? Is it going to help their shopping experience?’”

Today legacy cash register systems are not Internet-connected, putting bricks and mortars at a competitive disadvantage. When you shop online a site knows every detail about you. You could enter a brick-and mortar-store every day for a week and they wouldn’t know.

If Beacon technology is not the answer to engaging customers in-store something else might be. “Creating an incubator is a great way to understand all the ideas that are happening out there and expose ourselves to those,” says Coby. “We are hoping to build great companies and great products out of it but most of all we want things that will delight our customers.”

John Lewis Incubator Checks Out What’s In Store For Retailers

The five start-ups that made it to the final stage of JLAB, John Lewis’s first-ever technology business incubator, are targeting everything from 3D room planners and in- store digital engagement to wireless sound systems and smart labels for after-sales care:


What it does: An in-store digital engagement system which uses proximity and iBeacon technology. Currently, retailers don’t know when their best online shoppers arrive at a real-life store. Localz is designed to let retailers know they have arrived as they walk through the door.


What it does: An after-sales service that uses smart labels to increase customer engagement. Smart labels enable consumers and retailers to track a product’s lifecycle and make on-going service or repairs easier to handle.


What it does: An in-store digital engagement system designed to help retailers better understand their customers. In-store sensors track customers’ behavior as they move through the store, allowing retailers to better understand them and to offer them more personalized and efficient services.

Space Designed

What it does: An online app which allows consumers to accurately create and view virtual 3D versions of rooms in their houses so that they can then add potential new furniture purchases and see how they might fit in.


What it does: A wireless Hi-Fi system that can stream music from any platform to multiple rooms.



John Lewis decided to create the incubator, which officially opened on June 9th “because no one knows what the store of the future will be — it will always be a moving target,” says IT Director Paul Coby. “The incubator is about taking good tech ideas and testing them to see if they work in a business environment.” The five will get dedicated office space at JLAB’s London hub, located in Level39, as well as initial funding of £12,500, access to John Lewis proprietary technology such as platforms, data, and APIs and access to the full mentor panel.

Following a 12-week incubation period, the JLAB panel will select a winning company. The company will receive up to £100,000 in further investment and the chance to trial its solution in-store. Should this be a success, their solution may be implemented across all John Lewis shops.

• Those interested in knowing more are invited to a JLAB London Tech Week event taking place on June 19th at 18:00 on Level 42, One Canada Square, Canary Wharf. Register at



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