Is AI The Future Of Retail?

Disclosure: I am a Microsoft Advocate.  I have been provided with access to some of the company’s new technology – a Surface Book 2 – for evaluation purposes, as well as getting privileged access to some Microsoft Canada executives.  In return, Microsoft has asked that I share any opinions and insights with readers of this blog.  They have not asked me to guarantee anything – nor have they attempted to influence what I post. All views are those genuinely held – I’ll happily explain the basis for them.

Is AI The Future of Retail?

Walk down any mains street and you might think that retail is dead. Online is the future – of commerce, from customer acquisition, fulfillment and retention according to many experts. The days of traditional retail are, if not actually over, well on the way to extinction. A news story in yesterday’s Canadian Business Kickstart AM email quoted an Axios story predicting 75% of malls in the US will close according to J.C. Penney CEO Mike Ullman.

Retail Disruption

But not so fast. Retail is changing, but it’s not dying. In my world – the startup world – the mantra is disrupt or be disrupted. The list of companies that have failed to heed the warning is long – Kodak and Blockbuster are two well-known examples – but just because the businesses failed to adapt doesn’t mean the segment ceased to exist.

When I explain to people that my business is retail-first I get many raised eyebrows. It’s expensive, they say. I have to drive traffic, they argue. Wouldn’t it be cheaper to focus on e-commerce? The problem is that I still have to drive traffic to a website. Digital marketing isn’t cheap. And, e-commerce is still transactional – there’s very little opportunity to start conversations or to understand customer need. e-commerce is a very impersonal experience… and don’t get me started on chatbots!

From Online To Main Street

There’s also another trend that doesn’t often get talked about when discussing the future of retail – an increasing trend for online retailers to establish physical retail stores. Amazon GO is the best example, and their recent acquisition of Whole Foods Market demonstrates Jeff Bezos’s commitment to physical retail. In Canada online-first retailer Indochino is another great story of how a company started online and evolved to main street retail stores.

My decision to lead with a physical retail approach for COMMS.BAR is the result of many years research. Having studied companies like Apple, whose retail stores did (and probably still do) hold the record for retail revenues per sq. ft, Nordstrom, Starbucks and, in recent years, Microsoft it’s the right approach for my business. More accurately, it’s the right approach for my customers. Apple is headed in the wrong direction, in my opinion.  Nordstrom and Starbucks are works-in-progress, and Microsoft’s Retail Store strategy doesn’t currently get the recognition it will.  I’ll explain my reasoning for these opinions in a future post.


The key to successful retail in the future will be blending physical and digital to deliver the service that customers want. It’s a term that I started to describe as Physital – a combination of physical and online that uses technology to create the experience that customers want – which will likely change depending on the situation they are in. They key to successful retail will be delivering the same customer experience regardless of whether they are in a physical or digital store. Many customer engagements and transactions will likely use both.

Technology in physical retail is an area the commands a lot of column inches in the last 18 months.  AI (artificial intelligence), VR (virtual reality) and AR (augmented reality) have been positioned at one must-consider technology for retailers looking to survive.  The problem is that many of the articles I read every week talk in general terms about the technology and its value.  There is little written about how retailers can implement new advanced technologies.  There is little, if anything, written about the challenge of integrating technology into existing workflows and in-store customer experience to creating competitive differentiation and tempt customers and prospective customers to visit a physical location – rather than shopping form the comfort of their couches.

AI. The Future of Retail?

In the last few weeks as part of my relationship with Microsoft, see disclosure above, I’ve had the chance to talk with Microsoft Canada’s Digital Industry Lead – Dave Rodgerson.  Having spoken with him at the #FutureNow event, I asked for the opportunity to continue our conversation with him on camera.  The location was the Microsoft retail store in Mississauga’s Square One mall.

I started by asking Dave about his vision of the future of retail.


Tagged With: , , , , , , ,