2014 Retail Experts Survey & Predictions Retail is always an exciting, dynamic and somewhat challenging space. We have assembled some of the brightest minds in Retail to provide you with their opinions on how technology, e-commerce and social media will change the way Retailers do business in the future. Iâ€™d like to sincerely thank all of our Retail Experts for taking the time out of their busy schedules to share their knowledge and opinions. I trust you will enjoy (if not always agree with!) the insights provided by our experts. I would love to hear your thoughts on these predictions, so please feel free to comment. If you found the information useful, share it with your friends and colleagues.
Key Findings and Predictions from our Panel
Online sales will continue to have a huge impact on how Retailers operate their business. They key is seamlessly blending the in-store and online experiences. Cloud technology will allow Retailers to improve operational efficiency, improve the control they have over their business and reduce operating costs. Smartphones already allow consumers to have absolute control over the way they purchase products – this will become more prevalent than ever. The way that products move into and out of the Retail store will change as cloud technology allows for more reliable and accurate data to be accessed. Lead times will reduce. As consumers become less loyal to individual stores, Retailers must engage on a deeper level using multiple social channels to stay connected with their customers. Retail is competitive – it’s time for Retailers to take control of their business…and their future success.
Meet the Experts
Antony Welfare has been a retail and Ecommerce expert for over 20 years, with experience from international multi-channel retailers; Marks & Spencer, Sainsburys, Dixons Retail and Homebase. The last few years have been working with smaller entrepreneurs, online stores and fashion brands.
Director of RetailPotential.com Twitter: https://twitter.com/AntonyWelfare Facebook: https://www.facebook.com/AntonyWelfare
Phil has over 30 years retail experience working in the UK for Safeway and Asda. He has held positions from Regional Management responsible for over £340M a year, Head of Central
Operations and latterly Head of In-store Marketing for Asda. – See more at: http://retailremedy.com/team#sthash.rATwEwQp.dpuf
Managing Partner of RetailRemedy.com Twitter: https://twitter.com/retailremedy
Stuart Bennie is an experienced consultant who has extensive background gained in the retail, wholesale and IT industries. Having worked throughout the world, he has gained a global perspective on the drivers behind business. Stuart has worked in high growth companies and understands the challenges that rapid development engenders.
Director of ImpactRetailing.com.au Linked In: - http://www.linkedin.com/pub/stuart-bennie/5/18/a0b
As a Retail Consultant and Conference Speaker my work allows me to help retailers from as small as a one person business upwards. I particularly enjoy helping family businesses to grow and prosper. In my global work I see new trends in merchandising, display, social media marketing, general retailing, culinary eco-tourism and lifestyle retail.
Retail Guru at JohnStanley.com.au Facebook: https://www.facebook.com/johnstanleyassoc
Retail Guru with 30 Years experience in Retail. Worked my way up from being the best salesperson in the State of S.A. to Managing Million Dollar Businesses across many and various sites. Now a Mentor to Retail Businesses Worldwide.
CEO & Founder of RetailRescue.com Twitter: https://twitter.com/Retail_Rescue Facebook: https://www.facebook.com/retailrescue Linked In: http://www.linkedin.com/in/retailrescue
Nancy is a retail strategist, with over 25 years experience in retail, marketing, strategic planning, wholesale, product development, customer service, training & manufacturing in a diverse range of retail environments & product categories, in Australia, Asia, USA and Europe.
The Retail Miss Fix It at MagnoliaSolutions.com.au Facebook: https://www.facebook.com/NancyGeorgesRetailMissFixIt Twitter: https://twitter.com/NancyGeorges Linked In: http://www.linkedin.com/in/nancygeorges
Mark is a highly skilled qualitative/quantitative researcher with experience in consulting and research management. He has particular expertise in applying customer based insights to drive increased sales and profits, and to leverage emerging technologies that can add value to shoppers.
Director of ShopScience.com.au
Twitter: https://twitter.com/ShopScience Linked In: http://www.linkedin.com/in/markfletchershopsscience
The Insight Q1: Which consumer trends will have the biggest impact on Retail in 2014? ANTONY: Mobile Commerce, Social Commerce, NFC Payments (Near Field Communication). PHILIP: The move to mobile application of consumer browsing will be the start of a sea change in the way we engage with brands. It is unlikely to transfer to full completion of the purchase but selection will become increasingly important on mobile devices. STUART: Internet sales will continue to grow as consumers move more and more towards this purchasing option.
JOHN: The consumer looking for a weekday convenience and weekday experience from the same retail brand. This means retailers will need to be more astute at social media and bricks retailing. BRYAN: The two biggest trends will be the ability to create an experience and loyalty marketing that is non-obtrusive and relationship focused. NANCY: I think customers are looking for value and authentic connection – real life connection and service. MARK: Increasing expectations of seamless omni-channel retail experiences across all channels. Increasing valuing of their personal shopping data leading to greater expectations of retailers in both
the sophistication of their individualised offers, and in the payment (in various forms) for accessing shoppersâ€™ data. Increasing expectations of superior customer service from retailers, e.g. the level of service delivered by Uniqlo.
Q2: How do you feel cloud technology is going to change the way retailers operate? ANTONY: Cloud technology will allow retailers to break free from the wires and servers world that ties down their systems to physical places. Cloud technology will embrace wireless and Near Field technology to give the shopfloor staff freedom from fixed points, allowing more customer interaction. It will also allow data to be captured and used anywhere, on any device allowing a more rounded customer record. PHILIP: Retailers will become braver in their use and trust of the cloud technology. Mainstream retailers will not embrace its potential just yet but their e-commerce arms will be investigating and probing its uses. STUART: Significantly. Retailers are notorious for not wanting to outlay a lot of money. Many have been burnt. Almost everything will be in the cloud one day. JOHN: Cloud technology will reduce operating costs for the retailer.
BRYAN: Cloud technology will give retailers the ability to maintain control of their business, regardless of their own personal proximity. With the ability to keep all data synchronised in a â€˜liveâ€™ manner, it will provide immediate answers on the state of the business, even in a multi-store environment and across all channels. You can be in another country and remain in control.
NANCY: More agile, less cumbersome paperwork and processes, accessible from more places, information at their fingertips. MARK: Greater integration of procurement, logistics and operations leading to reduced operating costs.
Q3: Which specific technologies will have the biggest impact on retail in 2014? ANTONY: Wireless in store technology, Loyalty/Promotional targeting via mobile phones and NFC. PHILIP: iBeacon technology will get a lot of the media coverage as it starts to be rolled out, yet much of this will be initially negative until it is embedded and its benefits understood. STUART: The smartphone has to be impactful as more and more apps appear and also payment options via the phone. JOHN: The key trends in technology that will have a major impact is the consumer becoming more savvy with their smart phone and using it as a tool to communicate with the retailer. ‘Showrooming’ will continue to grow in importance and retailers will need a strategy to tackle this new consumer shopping habit.
BRYAN: Loyalty software including mobile apps. Interactive digital signage e.g. virtual ‘try this on’ screens and apps. Interactive Social Media. NANCY: Geo-locational / location based marketing…. because the customer is using it not because retailers understand or are using it properly.
MARK: Retailers encouraging in-store e-commerce ordering to reduce stock holding and offer broader ranges. Digital shelf labelling delivering more than just price information leading to a revolution in shopper purchase processes as they realise that they no longer have to rely just on price and packaging to make their decisions. Home product scanning with integrated shopping list apps to reduce the hassle of online grocery ordering.
Q4: What are the most important changes occurring in ecommerce that will affect retailers? ANTONY: The total integration of the customer experience online and offline. More use of social media for promotions and selling. PHILIP: The growth of the bricks brands e-commerce as they have finally woken up the need for a unique offering above and beyond their in-store offer on-line. STUART: Retailers will continue to harness their channels and communicate with customers one on one. Market segmentation is disappearing. The market segment is now one consumer.
JOHN: The most important change is the adaption of the smart phone as a marketing communications tool. BRYAN: In the past we were concerned about ecommerce not having the overheads of a bricks and mortar store, thus they can discount more. Now many that sell online are opening their own shop fronts, which should help to ‘level the playing field’ again. However, online sellers tend to have highly efficient data systems, which will give them stronger insights into what sells best and what doesn’t, so these new competitors should not be taken lightly. NANCY: Onsite: more suggestive, fluid sales process – easier browsing and selecting generally – it’s portable – customers shop when and where they want.
MARK: Brands encouraging in-store e-commerce ordering to reduce stock holding and offer broader ranging.
Q5: What are the most important emerging trends for Merchandising, Inventory & Supply Chain Strategies? ANTONY: More consolidation of hubs and distribution all in one for the multi-channel experience. PHILIP: The supply chain is becoming shorter as more trust is given to purchase on-line, although this is a stream rather than a river it will reduce both lead times and inventory cost in the years to come. STUART: Automatic replenishment by suppliers is one of them. Merchandise planning is still in its infancy for many retailers. More responsibility will be pushed onto suppliers for reporting on work in progress and on delivery. JOHN: The rapid emerging trend is retailers providing solutions rather than product. Inspiring merchandising that stimulates the consumer is the way forward. BRYAN: Efficient data capture and analysis is the most important trend for all of these. Once you know the types of product that sell best in your demographic, (including age groups and price points), you can then alter everything to suit. Merchandising will then focus on promoting to the correct target market. Best-selling lines will always be maintained and buyers will only look at new ranges that suit your relevant market. Supply chains will need to provide the appropriate quality at the correct price points and meet associated levels of demand.
NANCY: New stock regularly. Volume over margin. Being able to access stock in response to sales â€“ no more stock piling or waiting 3 months for the bulk of stock to arrive.
MARK: Brands taking increased responsibility for their own retailing, e.g. Nescafe stores. Shoppers demanding greater accountability in terms of ethical sourcing and origins, and ingredient information, e.g. allergies. Shoppers demanding more individually tailored product offerings, e.g. wider range of sizes, wider colour choices, and faster turnover in styles.
Q6: How is customer loyalty going to impact retailers in 2014? ANTONY: Technology and social media should improve loyalty giving retailers more data rich content to allow better targeting of promotions and offers. PHILIP: Brand loyalty is difficult to establish and easy to lose and the digital loyalty to brand even more so once the hygiene factors of ease of use are dealt with. I expect more promiscuity due to the online channel but geared around the same principles as always, understand the customer you win, failure to do so pushes them to your competitors; an on-line that is a click away. STUART: It has been impacting for years. This will continue as customersâ€™ expectations increase.
JOHN: Customer loyalty as we knew it in the past has gone. Consumers are not loyal to a brand anymore and retailers are having to work harder to engage with the consumer. BRYAN: Loyalty needs to be the number one focus for any retailer in 2014. Just 20% of your customers provide 80% of your income, so building a strong loyalty base is paramount to success. A mere10% increase in loyal customers can easily be the difference between foreclosure and a highly profitable business. NANCY: GREATLY â€“ the customer is more fickle and less loyal. Therefore customers who are loyal must be maintained and constantly paid attention to so they continue to stay loyal to the retailer. They donâ€™t stay loyal for historical reasons anymore.
MARK: Shoppers will increasingly demand that their loyalty is earned rather than paid for. Those retailers who can make this fundamental paradigm shift will reap remarkable returns.
Q7: How should a retailer take advantage of Social Media in 2014? ANTONY: Use it or lose the customer!! Social media is here to stay and growing â€“ all retailers must use it and learn how their customers want to shop with them using social media. PHILIP: Do it themselves rather than through an agency. Take control of the content and the real engagement of its customers. STUART: Not sure. Some retailers are taking this seriously and sending their social media interaction off shore. Others are doing nothing. It has a place and will continue to grow.
JOHN: Social media is an essential part of the marketing kit. All retailers need to be using it to engage with the consumer. BRYAN: Most retailers use Social Media incorrectly and thus they attain very little traceable benefit from it. The key to success is to encourage interaction as a way of engaging interest and getting more than just follows. Make your Social Media page informative, interesting, engaging, rewarding and fun. Then, once you have their attention, start thinking of ways to turn followers into buyers by getting them to visit your store. We do extensive training sessions on this subject, so it is difficult to explain in a short paragraph. NANCY: USE IT! Understand it. Understand how their customers use it. Start the conversation. Build a strategy. Execute. Evolve and adaptâ€Ś. MARK: Actually learn about social media and how shoppers use it in their lives and shopping, and stop viewing seeing it in a simplistic one-dimensional manner as either a cheap advertising medium
or a cheap customer service channel. Integrate the appropriate elements and aspects of social media into all components of their retailing, e.g. multi-dimensional strategies for marketing, service, merchandising, logistics etc.
Q8: What is your over-all most influential prediction for retail in 2014? ANTONY: Technology is there to allow data rich data on your customer – make sure you are getting the best and most comprehensive view of your customers. PHILIP: Despite the impact of new channels things remain the same as always for retailers. If you understand your customers and deliver for them they will keep on coming back. Be confused about it or sit on the hedge (like M & S / Morrisons) and you will start to have brand erosion. STUART: Internet sales are growing primarily for two reasons. Price and variety. This is a major influence for 2014 and beyond. JOHN: The large retailers will continue to dominate the commodity end of retailing and smaller niche retailers will be recognised as the specialists. Do not get stuck in the middle. BRYAN: Those that both move with the times but also stay steadfast to the ‘old school’ ways of building customer relationships will have the greatest success. Use the modern technologies to identify the best market for you and develop buying habits around this. Find a point of difference, e.g. develop a niche, and promote it. Give the best experience a customer could hope for, both instore and online, (including social media). Capture customer details and then reward them with appropriate relationship building activities, not impersonal mass marketing. Generate the “Wow Factor” and you will succeed.
NANCY: The old rules don’t apply. It is time for old fashion customer service (in all of its aspects not just face to face) with digital integration. The bricks and mortar store is where the magic and theatre happens – not primarily transactions but the place of connection, inspiration and relationship building! MARK: That those Australian retailers who actually accept that unless they are genuinely world class, and are constantly evolving all aspects of their business to ensure that they continue to meet global standards, will be the only ones who survive the next few years. Basically, for a variety of social, economic and technological reasons, the decades of ‘easy money’ in Australian retail are finally over.
Conclusion Well there it is! Predictions from our panel of Retail Experts. One thing is for certain, Retailers must embrace change and use technology to enhance their business and stay ahead of their competitors. How will you take advantage of the changing face of Retail?