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Mobile Apps and the Future of Shopping

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Retail shopping -- and retail jobs -- are on the verge of being completely transformed by a range of new technologies. First among these is mobile, where shoppers are increasing using their devices to shop online for lower prices and to manage the entire shopping experience on their mobile phones.

One good example is RoboShopper, a new Android app that allows shoppers to scan barcodes and then easily look for better deals using multiple comparison shopping services. Since online stores can escape the fixed costs associated with maintaining retail locations, its a good bet that an app like RoboShopper will find a lower price somewhere. Shoppers can also maintain shopping lists on their phones and then email or share those lists, making it possible to scan barcodes with their phones and then complete the shopping process on a larger computer if they prefer.

As smart phones increasingly become the focus of the shopping experience, the primary role for brick and mortar retailers is often degrading into that of a showcase for shoppers who want a physical connection with products -- before they purchase at lower cost elsewhere. Traditional retailers are trying to come up with strategies to combat "showcasing."  According to an article in Newsweek, one of the hardest hit chains, Best Buy, is planning to close dozens of stores, open smaller locations and invest in more luxurious retail settings in the hope that this will drive sales. Other major retailers have inked deals with their vendors to supply unique products (with unique barcodes), making it more difficult for their customers to comparison shop.

Online retailers are offering new delivery options designed to overcome the "immediate gratification" advantage that is perhaps the primary asset of traditional retailers. Amazon now has lockers in many locations where customers can take delivery of orders. eBay is experimenting with same day delivery, and probably has pockets deep enough to continue refining the service even if it means years of losses.

Even those traditional retailers who remain in strong positions are being transformed by mobile. Walmart, for example, has its own experimental program where shoppers are able to scan barcodes and then checkout and pay with their phones -- completely avoiding long checkout lines.  It seems clear that future shoppers will rely more and more on their mobile devices as a way to shop, pay and get help and information about products, even while in traditional retail settings.  This will surely create many opportunities for mobile advertisers to bombard shoppers with targeted offers at the exact moment they are on the verge of completing a purchase. And that would make things even harder for brick and mortar retailers (and especially smaller stores) to retain sales.

Retail has recently been one of the most important job creating sectors of the economy. Nearly every recent college graduate probably knows someone who was unable to land a job that required a college degree and is instead working in the retail sector. However, as technology and online competition transform the retail industry, there is certain to be a significant impact on jobs.

It seems almost certain that online retailers will continue to take a larger and larger share of the pie. In theory, this should not eliminate jobs but rather transition them from retail stores to warehouses and distribution centers. However, Amazon's recent purchase of the warehouse robot company Kiva Systems probably gives us a pretty good indication how things are likely evolve in the future: once jobs move to a warehouse it becomes easier to automate them.  At the same time, of course, technologies like self-service checkout lanes, mobile checkout -- and perhaps sometime soon even in-store robots -- will continue to drive down the need for even traditional retailers to hire as many people.

Big changes are coming to the way we shop and to the number and types of people employed in the retail industry. The only thing you can be really sure of is that your mobile phone, together with apps like RoboShopper or Amazon mobile, will probably play a more and more important role.

Martin Ford is the author of The Lights in the Tunnel: Automation, Accelerating Technology and the Economy of the Future (available from Amazon or as a PDF download). The book argues that accelerating information technology, and in particular robotics and artificial intelligence, is likely to have a disruptive impact on the future job market and economy. He also has a blog at econfuture.wordpress.com.