Retailing is on the verge of technology breakthroughs that will revolutionize shopping for consumers and provide a profitability and productivity boost for businesses, according to a new report from Dr. Sherry Cooper, Chief Economist, BMO Financial Group.
Cooper noted that businesses need to act quickly to compete with international retailers coming into Canada.
“It is especially crucial that Canadian retailers embrace new technology if they are to successfully compete with American and European retailers opening their doors across the country and shipping for free. Canadian retailers could leapfrog the competition by taking advantage of these advances, but they need to act quickly because it is already happening in the U.K., Europe, Australia and the U.S.,” Cooper said.
One example of these new technologies is kiosks – similar to airport scanners, that will do a free 10-second body scan for customers. These scanners, available in many U.S. shopping malls, take about 200,000 measurements in 360 degrees using low-power radio waves. The numbers are translated into personalized shopping guides for body size and shape. The kiosk then prints out a list based on the style, size or brand a shopper is interested in. The retailer pays a fee each time they show up in a personalized recommendations list.
Other innovations include technology that consumers can use at home to find garments that fit perfectly. The new software uses a webcam to measure a person dressed in dark clothing standing in front of a light wall. Other “virtual fitting rooms” create an image or “avatar” based on measurements sent in by a shopper and show how you would look in various pieces of clothing.
The report notes that clothing makers, armed with body data collected from shoppers, could sew better-fitting garments and more accurately forecast what sizes to stock. Retailers would save on labour needed to fold and re-hang rejected garments. An estimated 20 per cent of apparel bought online is sent back.
“The confluence of smartphones, 3-D printers, parametric technology and other digital technology will change retailing dramatically, eliminating traditional fitting rooms, check-out lines and expensive inventory and returns. This will be a win for both business and the consumer and one way to enhance productivity,” said Dr. Cooper.
“Canadian entrepreneurs have shown a remarkable resiliency and ability to change to meet the evolving needs of their customers. The retail landscape is one area where advancements in technology hold the potential to both enhance the customer experience and also improve the productivity and the bottom line of retailers larger and small,” said Cathy Pin, Vice-President, BMO Commercial Banking.
“With an attractive interest rate environment and credit availability, for many businesses now is the ideal time to make important investments that will help them grow over the longer term,” added Pin.
A full copy of the report is available here.
About BMO Financial Group
Established in 1817 as Bank of Montreal, BMO Financial Group is a highly-diversified North American financial services organization. With total assets of $525 billion as at April 30, 2012, and more than 46,000 employees, BMO Financial Group provides a broad range of retail banking, wealth management and investment banking products and solutions.