As new technologies are developed that make retail shopping faster and easier, consumer shopping preferences continue to change. We are already shopping in stores that no longer have cashiers to ring up our purchases. Instead, we are monitored via a series of cameras with very little human interaction. What does the future of retail look like?

In 2017, Synchrony Financial produced “The Future of Retail” report that looked ahead to the year 2030. The purpose of the report is to help retailers prepare for what is to come. The report covers everything from automation to brick-and-mortar stores to technology, providing, at times, surprising predictions.

We sat down with Vince Lowe, senior VP and general manager home specialty and flooring with Synchrony Financial. He shares some insight on what is currently influencing consumer shopping trends and how those trends will continue to evolve over time. The following are excerpts of our conversation, which you can listen to in its entirety below.

Floor Trends & Installation: How does home and flooring fit into the Synchrony financial portfolio?

Lowe: I'm part of a Synchrony Home and Auto platform, which is a portfolio designed to support consumers across both industries. My focus is primarily in the flooring, HVAC, or the “Do It For Me” space. So, everything that gets installed inside of your home, think windows, doors, garage doors, outside living spaces. My platform also includes furniture and home furnishings, and auto is part of that platform as well.

We have products in Home that are network driven, so they're accepted at multitudes of home furnishings and home products. But primarily, space is where consumers want to improve the overall structure or quality of the home itself and not the things in it. So think of things attached to it versus things in it. That's where I primarily play.

Floor Trends & Installation: So, renovation?

Lowe: Renovation, you think break/fix, you think an HVAC system goes down or a water heater or my windows aren't working. But there are also things that I want to do to improve my home.

With COVID people obviously take the home very seriously, probably more so than they have in the past. The quality of living in that home is critically important—everything from heating, cooling, appearance and structural quality of the home, kitchen and bathroom models, flooring plays a huge part in that as well. Just about any renovation is going to have some touch to the flooring space.

Floor Trends & Installation: We all realized during COVID how boring our homes were, right?

Lowe: Yeah. Not only how boring they were, but how small they started to feel. So, outdoor living has been obviously a growth category for us. But inside of that, reliability and sustainability are big categories, so think standby power generation. It is critically important for people who are working from home and who are living at home all the time. There are a lot of elements to the home that are not new in terms of what consumers feel are critical to the quality of the home.

Floor Trends & Installation: Something Synchrony offers are trends reports. You provide data on a regular basis. One of the things that Synchrony put out was in 2017. It was called “The Future of Retail Report.” It revealed data surrounding consumer shopping expectations for the future, but specifically, it was looking at 2030. Do you mind hitting some of the high points of that report?

Lowe: It was one of those great reports, and it did not anticipate a global pandemic. But what it did do is talk about the key trends of digital and mobile shopping and the importance of analytics and understanding consumer behavior, the integration of advanced technologies like AI in retail, and how that was going to affect the overall consumer shopping behavior, and therefore sort of inform our merchants and our partners about how they should adapt and change their offerings to accommodate how the consumer ultimately will start to shop.

It focused on how retailers would ultimately have to personalize the experience more. It had to be seamless integrations and seamless paths without friction for the consumer to go from research to purchase. And that's what the 2030 study was all about.

A lot of those trends have materialized. Some of them are accelerated, obviously, because of COVID but the consumer is still on that path.

Floor Trends & Installation: How does data from 2017 differ from now?

Lowe: There are two parts that I really have to answer. How we're collecting that data or how we're, not collecting, but utilizing that data. There's more of it, right? Obviously, there's more people in the process and flowing through a mobile experience or a purely digital experience versus an in-store experience. The omnichannel, meaning I'm shopping in one place and then purchasing in another, is also accelerated. So understanding that behavior and what the trigger points are, is critically important.

I'd say there's an enormous amount of more data just because of the volume of activity that happened during COVID. I'd say the consumer also has experiential needs. Touch/feel becomes critically important. There's always going to be a subset of consumers who want to feel/touch, understand what the color is relative to their home, what the texture is, how it will feel. So, while digital enables a lot of research and speed to decision, it doesn't necessarily close decisions as much as we probably would have anticipated, although consumers are buying enormous amounts in digital. When it comes to the home space, digital is not as pervasive because it's such a personalized and long-lasting purchase, if that makes sense.

Floor Trends & Installation: Is there still a tactile element to flooring?

Lowe: Yeah. Again, technology is taking great leaps with that. So, you have a lot of virtual reality experiences, right? You can take a picture of something and then model that in the showroom, or vice versa. But the merchants who are doing really well are accommodating that but also upskilling their sales associates to really understand what the consumer is coming from.

You know, ten years ago, if you wanted to buy flooring, you or I, an average person, we would have to rely on the salesperson to tell us all about the quality of the flooring, the features of the flooring. We wouldn't know if it was waterproof or not waterproof. But there's been a great leap in that ability to get information, so purchase cycle time is down because consumers can now research more, and they're coming prepared to go two or three questions deep when they get to the store. So there's a definite sales training element and product awareness that the salesperson has to know, because the consumer is already well prepared and well educated about what they want, what they're thinking.

It doesn't just come down to color. It comes down to features, functionality, whether it's pet friendly, whether it's waterproof, and, particularly the flooring space, what the warranties are like. So those kinds of questions become more prevalent in the showroom than necessarily hunting for a particular type of product. They're just so much smarter than they used to be. It's just a different shopping experience all around.

At the end of the day, you've got to make sure the color matches. You've got to take those samples home—whether that's integrated into the sales flow—and ultimately, you may decide in your home. And so, retailers have integrated our products for digital—apply and buy—inside of their flow. So once a consumer gets a product, they feel comfortable with it, they can make the purchase without coming back to the store unnecessarily.

It is definitely a time shortening experience for flooring than it used to be. But the intensity, I think, remains the same. Consumers are very choice driven, focused on long term, and they want to have quality behind what they're purchasing. I'd say that's the big difference in the experience. But overall, I think consumers will continue to push the envelope when it comes to virtual reality and things of that nature to shorten their window to purchase.

Floor Trends & Installation: How do you see AI playing a role in the flooring shopping experience?

Lowe: I think AI has been around longer than we've been putting on the headlines. I think we're guiding people to the next logical step in the purchase. We're guiding people to ask questions, or AI is guiding them to ask questions around “what are you looking for? Do you have a pet? Do you not have a pet?” And it's creating the funnel or the journey for the consumer to go through that shopping experience to make sure they're getting all the features and functions that they want.

I think AI will continue to corral the consumer faster through the sales funnel, but it'll also expand their ability to slow down, choosing and rethinking what they're doing from time to time. So it has a commercial purpose, which is to make sure you get to transaction and conversion. But it also has a consumer benefit of allowing consumers to have a broader funnel at the top to really understand what their needs are.

It'll continue to develop. I think companies will continue to leverage it in order to be better at how they're offering their products.

Floor Trends & Installation: This report is really fascinating, and one of the things that most surprised me is in the retail insights it says “third party, unbiased experts in the form of digital assistance will be popular.” What's interesting about this is it's basically saying that it's going to replace people so that we can get an honest response. We all go into something with our own opinions. So how will that impact flooring and flooring shopping?

Lowe: I think it impacts it the same way it impacts everywhere else. I think there are certain products and services that people will feel comfortable purchasing online and without human interaction. However, I do think there's always the quality of a brick-and-mortar sales experience where you don't have quite the idea in mind, and you're thinking, there's some locations I go into, and it's like a giant box of crayolas. Right? You see everything there. Now, people are there to help guide you and make the picture and the color and the quality that you want. So, it's easy to purchase a shirt or a pair of pants because it's pretty routine or repurchase a pair of shoes that you already have. But when it comes to installing something in your home, it's a large purchase. It's typically a lengthy experience. And so, you want to have a comfort level with who you're purchasing from and understand what the quality of that merchant is.

So, I don't think it's going to replace all of human interaction by any stretch of the imagination. I think where we interact is going to be more selective, and those merchants who set themselves up with expertise will tend to fare better than those who do not. It's not just pick up something off the shelf and go home. Consultative selling, understanding the process because any time you start to tear up your home, something can go wrong or unexpected. I think people will have a certain comfort level of who they're doing business with, and that's not going to change. People trust people, so they need that interaction.

Floor Trends & Installation: Where do you see retail technology heading in the next six years?

Lowe: It's going to be more and more integrated with the mobile and digital experience. When you look at how Synchrony is integrated, it's applied by functionality direct to device, where we're financing on the mobile phone, and then purchasing through an omnichannel experience, digital or in store using barcodes. I think the purchase path continues to accelerate and becomes easier for the consumer to manage. I think merchants will continue to leverage AI and CRMs to engage their customers for not only the purchase that they're looking for, but also the next purchase. Typically, you don't do a whole home at once. You do a room or two at a time, and then you come back and do another room at a time. So it's critically important that the data that our merchants are collecting on consumers’ desires is maintained, and they're engaging. I think that it'll continue to accelerate.

I think the VR for product visualization will get better. When you're doing a kitchen and bath remodel or flooring remodel, you're selling a dream. And you see a lot of things on TV. There's a whole channel dedicated to it, as we all know, or multiple channels. I think that is inspiring people to think differently about their home and what is possible. The merchants are going to have to be able to meet that expectation. You see more designers coming into the space where they're helping consumers realize that whole space versus just a single element of that space and what the implications are. So consultative selling remains critically important.

When you think about redoing a whole room, just replacing a floor for floor, that's pretty easy. But most people don't do that. They're doing more than just the floor. They're doing the tiles, the cabinets, whatever is needed for the whole home. I think where we're going is an acceleration of what we already have, which is virtual reality and AI. But I also think you're going to see an acceleration of consultative selling and design support for people who need it in their home.

Transcribed using Edisource International Newsdesk with AI Smart Assist.