In a fascinating discussion between retail expert Brian Walker and futurist, technological economist, and co-founder of Macro3D, Steve Sammartino, the evolving landscape of retail emerges as a complex interplay between economic forces, AI, robotics, and the human experience.
As we peer into the future of retail towards 2030, several compelling themes surface that will reshape how we shop and interact with businesses.
The Horisontalisation of Technology
Sammartino presents a profound insight into how AI is evolving, describing what he terms the “horisontalisation” of technology. While AI has existed since 1952, it has traditionally operated in isolated verticals—think Google Maps optimising routes or standalone retail systems. However, we are witnessing a fundamental shift towards interconnected systems.
“We’re getting neural networks, which really have a sense of biomimicry about them. They operate a lot like the brain where there’s all of these little nodes that all connect and can interconnect and work together”, Sammartino explains. This shift from symbolic to connectionist AI represents a significant evolution, where systems can integrate disparate information sources and create new insights in ways that mirror biological intelligence.
The Dichotomy Economy
One of the most striking observations is what Sammartino calls the “dichotomy economy” – a growing split in the retail landscape. “We live in a world of Tiffany’s and Costco. It’s either super premium or super cheap”, he notes. This polarisation is evident across various sectors, from retail to technology, and even housing.
The success of this bifurcated approach is exemplified by the world’s wealthiest individuals: Bernard Arnault of luxury conglomerate LVMH and Jeff Bezos of Amazon, representing opposite ends of the retail spectrum. This pattern extends to technology companies, with Apple commanding premium prices while Amazon Go stores eliminate human interaction for cost efficiency.
The Physical-Digital Interface
As technology advances, the boundaries between physical and virtual retail experiences are becoming increasingly nuanced. While Amazon’s Australian presence is projected to grow from $6.5 billion to over $20 billion by 2027-28, the role of physical retail spaces is evolving rather than diminishing.
Sammartino draws an intriguing parallel with the music industry: “Right now, I can get the most perfect version of a Taylor Swift song for free online… Yet, I can’t get a ticket to see her at the MCG or couldn’t to see an imperfect version of her singing live and viscerally”. This observation suggests that human interaction and physical experiences may become more valuable precisely because of their imperfections and scarcity.
The Rise of Humanoid AI
Perhaps the most provocative discussion centres on the potential for humanoid robots in retail settings. Sammartino predicts that by decade’s end, we will have “humanoid robots with soft exoskeletons and micro-movements within flesh-like silicons where unless you touched it, you wouldn’t know”.
The implementation of such technology appears inevitable in certain retail sectors. As Sammartino explains, “I can’t imagine a future of a supermarket or a pharmacy where we will get a human to fill the shelves up if a humanoid robot can do it better, more efficiently, understand the stock, even know when the stock’s changing”.
The necessity for humanoid forms stems from our built environment: “Everything we’ve built since humans became the apex species on our planet is human shaped. Doorways, stairways, cars, cities, buildings, everything is human shaped”. This infrastructure reality necessitates that AI must adapt to our physical world rather than the reverse.
Societal Implications and Challenges
The widespread adoption of AI and robotics in retail raises significant societal questions. Issues of governance, taxation, and workforce transition loom large. “Should there be robot tax? If someone has more robots, should there be tax per robot? How do we redeploy people?” Sammartino poses these critical questions, highlighting the need for careful consideration of how we shape this technological future.
The Path Forward
Despite the seemingly unstoppable march of technology, opportunities for innovation remain. Sammartino offers hope for nimble operators: “Just when you think it’s impossible for the big to be unseated, usually they invent the technology which opens up the opportunity for new competitors”.
The future of retail appears to be one of balance – between efficiency and experience, between technology and human touch. While AI and robotics will undoubtedly transform the industry, the premium placed on genuine human interaction may well increase. As we navigate this transformation, the key lies in understanding how to harness these technologies while preserving and enhancing the aspects of retail that make it fundamentally human.
Success in this new retail landscape will require careful consideration of where to deploy technology for efficiency and where to invest in human experience. As we approach 2030, retailers who can strike this balance while remaining adaptable to technological change will be best positioned to thrive in the dichotomy economy.
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