(Really) Interesting Times
Well, 2018 certainly was interesting. There was plenty of grist for the pessimists among us, though — for the more sanguine — there was also much to be hopeful about. Yet, for all of 2018’s many peaks and valleys it was a year that suggested more progress than regress when it came to advanced technologies. And signs point to yet another year of steady advancement in areas like AI, Voice, Blockchain and more. As these technologies continue to take root in new sectors there is much to be bullish about in 2019.
First, the disruption and transformation of retail has already been well documented. The Retail D2C revolution in the brand direct economy has illuminated and put pressure on legacy retailers to launch and execute Retail D2C strategies in 2019 — from sourcing to delivery to CRM.
As an investor what’s most interesting about the space is — first and foremost— the urgency. Retail enterprises need to innovate or die and to do so they need help badly. Those companies offering B2B services necessary to survive and thrive in a Retail D2C environment are in a great position in 2019.
Advanced tech also offers a path to real omni-channel marketing in retail which, for the companies and platforms that get it right, will be transformative. I’m talking about connecting the dots between online and offline with technologies like facial recognition, mobile tracking, hyper personalization, etc.
The technology is there. The urgency is there. The market is already being massively disrupted. These are all signs that retail — far from dying — is rapidly evolving and the pace should only increase in 2019. Expect to see a lot more transformative action here.
And, in the Age of Amazon, there is also a huge opportunity for venture groups to invest in those eCommerce-only brands that are already advantaged and moving swiftly against legacy retailers.
For most emerging retail brands there will be essentially two paths to choose from in 2019; 1) build on existing platforms (like, Shopify), or, 2) build outside of platforms like Shopify, a path much more likely for immediate physical retail spaces looking to complement eCommerce strategies. When you’re looking at eCommerce versus a physical-“store-first”-strategy, this latter path offers massive advantages to legacy retail brands.
Another area to pay attention to in 2019 is Big Data (again). The concept of data as the new oil has been around since at least 2006 but there is much to like about this analogy in 2019, particularly as it relates to pure data plays that enrich data and create secondary marketplaces. Processing power and storage have reached a kind of tipping point in terms of speed and cost efficiency allowing the analyses of massive amounts of data in near real-time while storing it all at a fraction of previous costs. Now that we are able to refine data sets so quickly manipulation of this data will create a boon for companies specializing in consumer personalization across a host of sectors as well as create new opportunities for secondary trading marketplaces.
Lastly, Voice and Visual Search definitely arrived in 2018 and are already primed to replace the keyboard in the very near future. There have been massive improvements in the underlying technology, particularly with natural language processing. (It really works!) And when you take into account the seeming ubiquity of devices like Alexa, Google Home and Siri and combine that with demand for apps on the voice ecosystem you have a very intriguing market for investment this year.
Predicting the future is often more art than science, but the continued emergence and blossoming of the advanced technologies underpinning Retail and Data, as well as Voice & Visual search seems undeniable. In all three areas there is potential for explosive growth and transformation in 2019. Businesses supporting these sectors will be buoyed by the revolutions going on here and will be big winners in 2019. And that’s great news for the venture firms wise enough to back them.
