TR Consumer Forum 2024: All eyes on progress of AI, Web3 and the Metaverse

By Benedict Evans |

The first panel of day two delved head-first into the cutting-edge technologies which could transform travel retail.

The first panel session on the second day of the TR Consumer Forum 2024 covered This  the dynamic interplay of these cutting-edge technologies and the new touch points they create, led by data insights from m1nd-set, and our panel of expert contributors.

Anna Marchesini, Head of Business Development at m1nd-set; Simon Black, Executive Managing Director, Newmark Retail; Jonathan Chippindale, Chief Executive, Holition; and Andy Machin, Managing Director, Kounter Retail all took to the stage to break down the evolving digital landscape and its potential impact on travel retail and consumer choice.

M1nd-set data

Marchesini delved into new research which broke down emerging online technologies, revealed the three pillars of hybrid shopping which form the backbone of a strong phygital offering – a notion discussed in a different context on the first day of the forum – and highlighted some surprising purchase drivers among new-age consumers.

Travel retail is under-performing vs. the domestic channels when it comes to online purchasing,” noted Marchesini, adding: “The Middle East is one of the best regions in terms of online ordering, but Gen Z is, surprisingly not over-indexed despite being online natives.”

Marchesini detailed the various emerging technologies which have a part to play in shaping the retail environment and consumer behaviours.

Marchesini commented further, noting: “Awareness of the value of the service is very low, though interest is high once informed, and actual usage down. Travel retail is certainly viewed as lacking phygital integration, and travellers coming from domestic markets offers a direct point of comparison.”

Metaverse

Black detailed several examples of the metaverse and its multiple uses for a wide array of brands; examples included Decentraland, one of first digital worlds, which saw $1.3bn of initial investment from the likes of Nike to Coca-Cola. Though this platform died a death, it paved the way for AI store management as used by LuluLemon, Color IQ tech for Sephora, and even a fashion show from Ganni, a Danish-Scandinavian fashion brand, ran almost entirely by AI.

“The focus now is shifting to generative AI, and we see that with the brands we work with,” noted Black, adding: “Meta is a great example of this as founder Mark Zuckerberg lost $45bn investing in it. To put that into context, that amount is more than United Airlines has made in the last two years in revenue.”

Black strongly posited retailer focus should rapidly pivot to understanding and utilising generative AI.

“Digital will never rule because travel retail is a physical environment, but my takeaway for the industry is use generative AI to improve experiences,” commented Black, adding: We saw very little engagement three or four years ago, and it was really disappointing, but now we’re seeing engagement from the big retailers, and the fact we’re lagging so far behind actually presents an opportunity for massive growth.”

Holition

Chippindale also offered his outside perspective on the possibilities for digitalisation within travel retail, saying: “Some of the more old school French luxury groups have taken huge strides forwards in the way they’re adapting these new technologies. You don’t see that in travel retail, and I worry that you’re starting tarting to see a splintering of brands across travel retail and domestic.

It’s not a cost thing anymore, some of these tools are ubiquitous and highly affordable; it’s a mindset thing.”

Chippindale also made reference to VivaTech, which was (relatively) recently acquired by LVMH Group. Chippindale said of the event: “One of the criticisms levelled was all these startups are developing a solution and looking for a problem to solve.”

The metaverse is meant to be unified, but it’s very disconnected, it hasn’t really existed yet, it’s the endgame.” Chippindale on the future of the Metaverse.

Chippindale ended with a comment on the attitude of retailers who can sometimes be too reticent to try something new:

“Retailers are all about newness, especially in fashion, and brands look at this tech and then move on, we discard a tech before it’s had a chance to mature into something commercially viable,” he commented, adding: “Innovation by definition does not have a definitive business case, because no one has done it before, it’s expensive because it’s new but it’s sharp-edged.”

Balancing needs and useful tech

Machin explained to the forum how retailers can best incorporate immersive VR environments in a separate but related manner, using the Gaming Point at Manchester Airport as a case study.

“Anyone of any age can immerse themselves in VR, everything from escape rooms to F1 simulators,” said Machin.

“What we have found is that while retailers see it as affecting sales, those travelling with Gen Alpha and Gen Zs can leave them there, and it actually works in conjunction with retail – say with F&B – and we now have retailers looking to incorporate different facets of this technology to increase dwell time, and allow brand ambassadors to work on influencing basket size,” he added.

Machin also walked delegates through a series of interactive AI and digital campaigns which ranged from a shortbread vending machine in Edinburgh to a CustomGBT AI chatbot which could: offer wine recommendations; was contextually aware; and could respond instantly in 31 different languages.

Machin detailed how immersive experiences like this could help, not hinder, retailers, by capturing more of a consumer’s dwell time.

“Brands come to us and they have budgetary pressures, whether its global or regional roll-outs,” noted Machin, adding: Their default is to do the same old, but this tech is extremely affordable, so implementation and budget isn’t a barrier, it’s more about getting brands to think outside of the box, which is why we like to get involved at the concept phase.”

Finally, Machin spoke to the future consumer and their likely demands of a retail environment: “This is very fast evolving tech and it is the future. This kind of thing is is what Gen Z will be expecting. Bricks and mortar retail needs to move past just touchscreens.”

READ MORE: TR Consumer Forum 2024: Ramesh Cidambi gives keynote speech

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