In November, subject matter experts at Demandware did what a lot of thought leaders do that time of year – they went out on a limb with predictions for the year ahead. What’s different about the predictions that the global team at Demandware made? We are owning what we said.

We are at the halfway point of 2016 and are presenting a “report card” of sorts, revisiting our predictions and rating our performance with a star system from 1-5. One means we were completely off base, while a five puts us in Nostradamus territory.

Scroll down past the infographic for a more detailed explanation of our score. How do you think we did? Do you agree with our assessment?

[Infographic is being reformatted – check back ~8/22]

RAMA RAMAKRISHNAN, Chief Data Scientist

Prediction: Machine learning will drive voice-based intelligent assistants. Machine learning will expand beyond shopper personalization to positively impact merchants and marketers in the form of a Siri-like intelligence assistant that pops up occasionally with insights and recommendations.

Grade: 3 stars

Reason for Grade: Consumer application of voice-based assistants has made some strides (Amazon, Google, Facebook, Apple and Microsoft are investing heavily) and talk of chatbots has been all the rage for several months. However, it is still very early days – too early to say that merchants and marketers have been positively impacted. That said, we have no doubt that intelligent machine learning will dominate customer service, personalization and other aspects of retail in the not-too-distant future.

 

JULIE ROUSSEAU, Industry Principal

Prediction: Retailers will realign their organizations. 2016 will be the year of organizational change, as attention turns to the significant organizational challenges required to deliver effectively on the omnichannel promise. The dissolution of the boundaries between ecommerce and the rest of the organization will gain momentum.

Grade: 4 stars

Reason for Grade: Retailers the world over are focused on putting the customer, whether they shop online, offline or both, at the center of their initiatives. That requires significant organizational realignment including newly defined roles and responsibilities, reporting structures, and new roles altogether. This is hard work and takes time, but it is happening, and the dissolution of boundaries between online and offline has unquestionably gained steam.

 

DANIEL RECKLING, Industry Principal

Prediction: Alibaba will struggle. They are huge but have ceased to innovate. They are challenged in China and have yet to successfully enter new markets. One year after its record IPO, Alibaba shares have lost more than one-quarter of their value. Many global retailers stand to gain ground and Chinese ecommerce consumers have shown a new willingness to buy directly from brands rather than through massive marketplaces.

Grade: 4 stars

Reason for Grade: Alibaba’s shares have lost more than 12% of their value since our November 5, 2015 prediction. JD.com, its chief stateside rival which has just partnered with Wal-Mart, has encroached on its market share and has outpaced Alibaba’s revenue growth for seven quarters. But the game will become even tighter for marketplaces in China: The wildly popular messenger WeChat opened its doors for commerce and direct to consumer interactions. With more than 700 million active monthly users, the app became an internet unto itself. In fact, capitalizing on the WeChat commerce function was a major topic at our Demandware Roundtable in Shanghai this March – a discussion that’s relevant for all verticals.

 

ERIC OLAFSON, Senior Vice President, Business Solutions

Prediction: In-store payment will evolve dramatically. Retailers will implement mobile POS systems, beacons, sensors and other touchless technology…that makes paying for merchandise feel like stealing.

Grade: 2 stars

Reason for Grade: We’re just not there yet. In-store payments powered by mobile wallets will transform the point of sale, but it’s been a slow process, as there have been delays in implementing the required infrastructure. But we’re bullish. It’s not a matter of if but when. According to a Business Insider Intelligence study, US in-store mobile payment volume will hit $75 billion this year, and will reach more than half a trillion by 2020.

 

VINOD KUMAR, Senior Manager, Analytics and Intelligence

Prediction: Gen Z will become a bigger force in online commerce. Generation Z (those aged 12-17) will become a larger percentage of online commerce in North America, driven in large part by integrated experiences between ecommerce sites and social media.

Grade: 4.5 stars

Reason for Grade: Gen Z is the first generation to literally grow up online. An astonishing 46% spend more than ten hours a day online. They may not have a lot of their own money but they are influencing household purchases; 93% of parents of Gen Z say their kids have at least some sway over family spending. These young guns, who number more than two billion globally, have spending power of more than $44 billion in the US alone. According to nSites Consulting, a global research agency, “They’re the biggest, richest, most independent generation so far.”

 

ELANA ANDERSON, Senior Vice President, Global Marketing

Prediction: Push marketing will make a comeback as retailers look to remove as much friction from the buying experience as possible, and enable consumers to buy products not just in their store and on their site, but at the point of interaction. At the same time, the traditional divide between marketing and commerce at many major retailers will start to collapse in 2016, resulting in these organizational functions coming together.

Grade: 4 stars

Reason for Grade: Push notifications, which allow retailers to contact consumers through a browser, even if they don’t have that retailers’ web page open, are being used in increasingly higher numbers, to great effect. Upwards of 90% of web push notifications will be seen, and are ten times more effective than email marketing. The click rate of web push notifications is more than 25% vs. less than 10% for email. At the same time, mobile has enabled consumers to make purchase decisions on the spot, giving retailers a prime opportunity to push relevant content and offers at precisely the right time.

 

GRAEME GRANT, Vice President, Business Solutions

Prediction: Data-driven decision making will replace gut instinct. 2016 will be the year that the majority of retailers move from intuition-based decision making to data-driven decision making, creating, among other things, a severe talent shortage of data scientists, which are already in tight supply. Scrappy startups will leverage data science to battle the bigs. One example: 4-year old Stitch Fix has employed fifty data scientists.

Grade: 4 stars 

Reason for Grade: Data-driven decision making has clearly moved to the forefront, which is partly evidenced by the predicted data scientist shortage. A 2016 survey found that 83% of respondents confirm a shortage, up from 79% last year. Stitch Fix was a pioneer in leveraging data and sophisticated algorithms to personalize the shopping experience but, as we predicted, it’s not alone. According to Inc.com, “savvy startups are using data technology from day one to maximize their customer conversion and impact.”

 

ROB GARF, Vice President, Industry Strategy and Insights

Prediction: Last mile fulfillment providers will drive instant gratification and retailers will further leverage and extend their stores as fulfillment center in an effort to compete with Amazon Now. Google will begin to position its self-driving cars as a retail fulfillment method as retailers continue to look for innovative ways to defray the profit-crushing expense of free shipping and returns.

Grade: 4.5 stars

Reason for Grade: Google has indeed filed patents for a self-driving car (a truck, actually) to deliver packages to specific destinations. Uber, GM, Lyft and Amazon are also investing heavily in this area as retailers grapple with the incongruous problem of shipping faster, for free, while maintaining profit margins. However, it will be several years before we receive our goods from autonomous driving cars. To leverage their stores and reduce shipping costs, American Eagle Outfitters and Target, to name just two, have significantly ramped up efforts to use their stores to fulfill orders.

 

ALAN BUNCE, Vice President, Product Marketing and Community Marketing

Prediction: The term ‘omnichannel’ will become a passé, dated term as the number of shoppers buying products from multiple channels, on multiple devices, outstrips those who only shop one channel. ‘Omnichannel’ will be replaced by a more apt term like unified commerce, which refers to a single commerce platform that gives retailers a unified view of customers, inventory, etc., across all channels.

Grade: 5 stars

Reason for Grade: While the term ‘omnichannel’ hasn’t been eclipsed (yet) by ‘unified commerce,’ this prediction has come to pass more dramatically than all the rest. Starting with the NRF Big Show in January, every major industry event in 2016 has featured presentations from retailers, analysts and thought leaders that stress a customer-centric view of retail that obliterates any notion of a “channel” and focuses on a shopping experience that just – is. Indeed, a Boston Retail Partners report found that 78% of retailers planned to be running their business on a unified platform within five years.

So overall, we didn’t do half bad. In fact our average score of 3.88 stars is entirely respectable given the volatility of our industry and speed of change. Stay tuned in Q4 for Demandware Predicts: Retail in 2017.

Reporting by Liam Sullivan