Endaba Trends and Predictions 2017: Rise of the Bots

Endaba Group

As the dust settles after a tumultuous 2016 and record-shattering holiday shopping season, it’s time to look at the new year and the new opportunities and challenges.

Already, there are many overarching forces that will shape the marketplace in 2017, including a complex US political climate unlikely to stabilise soon, the UK government beginning their negotiations to leave the European Union after Brexit, and the thawing of Hong Kong’s retail “ice age” and how the economic relationship between China and US will fare.

This week, Endaba takes a look at what could be the disrupting and defining technology trends of 2017 and makes our predictions. As we look to 2017, several common themes emerge: the impact of major votes last year, the progession of “smart,” and the long anticipated arrival of exciting technologies…

RISE OF THE BOTS

1. Artificial intelligence (AI) is going mainstream!

AI is expected to triple in 2017, as brands tap into potential of machine learning and look to take a leading position on the Internet of Things. It has great potential to disrupt the path to purchase. Amazon’s Echo, Echo Dot and Google Home took the world by force at the close of last year. There are many elements to AI that could influence the market in 2017

i. Voice activated shopping will only get louder

Amazon’s Alexa was the breakout tech of 2016. The presence of connected home devices and virtual assistants will only increase in 2017, as Microsoft gets ready to debut their competitor, but as will their relationships with other products and devices and their influence on how, how much and where we shop.

It’s interesting to look at how ordering, particularly on Amazon Echo, actually works. It’s not just about how much we’re buying but also how we are echobuying and what this means for retailers and manufacturers. If we’ve purchased from a category before, the most recent item will be added. If not, we’re prompted with a subset list of products, named ‘Amazon’s Choice’. Customers today aren’t asking for named brand products, just the products themselves! So, how can manufacturers get onto this ‘choice’ list and what are the algorithms and rules driving the retailers? As such, the retailer continues to have influence and power over what’s suggested to customers!

ii. New brand interactions

Voice activated shopping doesn’t stop with Amazon devices. Many brands are partnering with Amazon and leveraging Alexa technology. 2017 is all about making shopping effortless

E.g. Smart Refrigerators – eventually, we want our refrigerators to track our food usage and auto-order items when running low, or at least add to our household grocery list. So far, Frigidaire, GE and Samsung have hit the market with their best options. Quietly at the end of last year, LG Electronics put Alexa in the fridge with their Smart InstaView refrigerator, allowing customers to incorporate any number of Alexa skills into the refrigerator, as well as ordering groceries through Amazon Prime by speaking or checking what’s in their fridge through the app whilst out shopping!

E.g. Alexa on the go – motorists will be able to order products, asks questions and directions from their vehicle. Ford are integrating Alex into its in-car Sync 3 infotainment systems

These are only validations of how successful and widely used Alexa and virtual assistants have already become and will continue to grow in 2017

iii. AI in CRM systems

There is a growing importance and need for AI in CRM systems. Salesforce released their ‘Einstein’ software at the end of last year, which boasts predictive capabilities based on a customer’s previous interactions. Incorporating AI into CRM equals better insights that we can’t get from static CRM systems. It also means customers won’t get continuously spammed with unsuitable or unwanted content.

2. Zero User Interface and the screen-less future!

Customers today want to reduce interactions with screens in favour of their movements, voice, glances, and eventually thoughts, causing systems to respond in their current environment.  This will call for brands to redefine how they communicate with customers and prompt them to think about their brand behaviour. There will be no screen or brand messaging opportunities.  Brands are already falling behind in their attempts to understand the changing customer and their behaviour. 2017 needs to be the year they really step up!

3. Chatbots and conversational UIs

Thousands of chatbots were born in 2016: airline travel chatbots booked lights (Lufthansa’s Mildred); hungry chatbots booked tables and ordered food (Conversable); and there were even banking chatbots (Mastercard’s KAI).

Understanding human conversation and behaviour is no easy task for a human let alone computers, nor is it a cheap feat. However, the potential long-term gains are huge. Customers opt-in, allowing retailers to access lots of rich and explicit purchase-intent data. Retailers can then utilise this to communicate differently with their customers and it’s a customer service that never sleeps! The opportunities are endless

4. Robots hit the streets!

The end of 2016 saw Amazon Prime Air’s first successfully drone delivery – 13 minutes from click to delivery.

Indrone the US, federal aviation administration regulations prevent drone delivery. Whilst they work with regulators and policy makers, in 2017, we could see self-driving automobiles or drones instead! London-based Starship Tech introduced small, self-driving robotic delivery vehicles, which were tested in London, Berlin, Arkansas and Tallinn, Estonia in 2016. Over time, the robots will be cheaper than human delivery workers! Already, Just Eat and Hermes are using them.

That’s our technology trends and predictions for 2017. We wait to see how right or wrong we are in the beginning of 2018 … but no pressure. A lot can happen in twelve months!

Next time, we look at what could happen in retail in 2017