It turns out, the key difference between these two differently performing retail segments was tolerance for failure. Roughly half of retail winners said their company had a "fail fast" philosophy, driven by experimentation, followed by 41% of US retailers that said they aggressively try new ideas and accept that they won't always work. Most non-winners reported their companies were cautious (45%) and wouldn't try new things without some probability of success. Of the respondents polled, fast moving consumer goods (FMCG) companies, i.e. supermarkets and drug stores, were the most likely to use this conservative approach (69%).
Retailers as a whole tend to be conservative, as evidenced by the relatively small number that were willing to try new technologies. Around one-third of the US retailers surveyed were piloting use of artificial intelligence (AI) and virtual or augmented realty (VR, AR) in small areas of the business. Internet of things, robotics and new interfaces like voice recognition were being tested by fewer retailers.
This isn't necessarily the wrong approach. Tech, like AR, can improve the customer experience for shoppers who want to see how a shade of lipstick will look with their skin tone or if a sofa complements their living room color scheme. But experiences aren't always made better, and loyalty isn't achieved by retailers using tech just because they can.
Shoppers are skeptical when they don't see the benefits of retail tech. Past studies have shown that affluent internet users in the US don't use much tech in-store at all and shoppers across the board aren't crazy about the idea of facial recognition in-store or AI choosing—and ordering—products for them.
On the other hand, utilitarian technology like automated returns and location-based mobile coupons would be enticing enough to encourage consumers to shop at those retailers.