Guardian Labs: Friction Free - commerce in the customer age

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Guardian Labs

Friction Free - commerce in the customer age

Why the internet of things will sweep away the supermarket

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The rise of connectivity and the internet of things is making it possible to buy anything – tickets, petrol, clothes – exactly when it suits you. Welcome to the world of contextual commerce
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Contextual commerce will mean that banks cards are stored on a range of devices, from smartphones and watches to clothes and cars. Photograph: mixetto/Getty Images

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An array of emerging technologies are enabling merchants to begin creating a world of seamless shopping, in which the barriers to commerce will disappear. Pushing a trolley around a supermarket may soon be a thing of the past; stocking up on the necessities of life will be achieved with just a few clicks on a smartphone.

At last year’s Mobile World Congress, Facebook co-founder and chief executive Mark Zuckerberg said he hoped that virtual reality (VR) would become a “killer application” of 5G, the next generation of mobile broadband. Due to launch in 2020, 5G promises download speeds up to 50 times faster than 4G.
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Virtual reality shopping is shaping up to be an effective way to remove the friction from shopping. For example, China’s e-commerce giant Alibaba has unveiled a virtual reality system where shoppers pay for goods while wearing VR goggles simply by nodding their heads.
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New technology is having a transformative effect on the retail sector. We are on the cusp of a new age of connectivity with the development of the internet of things. This will usher in an era where everyday objects become shopping terminals. Connected cars will monitor their owners’ needs and learn about their shopping habits. At this year’s Consumer Electronics Show in Las Vegas, Honda revealed an in-car payment system that notifies the driver when they get close to a smart fuel pump or parking meter that accepts payments from the car. The driver selects the amount of fuel they want or programmes in the parking time. The amount is then displayed on their dashboard. They simply press to confirm.

Amazon’s Dash buttons also set a direction for frictionless commerce. A button for, say, a detergent brand is placed by the householder’s washing machine. The consumer simply presses the button when they need a refill and the system’s one-click ordering process will make sure the product is sent to their home.

These examples illustrate the way technology is moving retail into an era of convenience and context. Consumers will be able to purchase goods and services “in the moment”, rather than sitting down to work out a shopping list and then ticking off the goods as they buy them.

This “contextual commerce” is already happening on mobile devices, social media platforms – for example, buyable pins on Pinterest – and aggregator websites. When consumers visit price comparison sites for financial services, flights or other products, they can purchase the desired product directly on that site, rather than be redirected to the merchant’s website. If friends are on a messaging app discussing a band, a button allowing them to buy tickets to the band’s next gig appears. There’s no need to search around for dates and tickets – the opportunity opens up as the context arises.

Contextual commerce is still in its early days, but with increased connectivity and social media engagement it is forecast to grow. But let’s not forget the leisure shopper. As digital technology makes buying simpler, this will create a space for physical stores to provide shopping as theatre. Stores will be able to offer showrooms for fashion, specialty foods, electronic goods and furniture. Retailers will link into consumers’ social media profiles as they enter the stores, connecting to their mobiles via beacons. They will use this personal data to recommend goods in-store and make offers, guiding shoppers around the store and turning the trip into an entertainment experience.

The trend towards friction-free shopping will require simple, one-click payment methods. Credit card and banking details will be stored on a range of connected devices, such as smartphones and smartwatches – even clothes and cars. Payment will be made with the wave of a hand or the turn of an ignition key.

Seamless shopping will make life easier. But retailers need to ensure that shopping remains vibrant, gratifying and fun, as it grows ever more convenient.
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