Top 5 Retail Trends & What They Mean For You
Recently we shared our list of 100+ industry stats that have changed the way we think about retail. Now we’ve pulled out 5 retail trends and we’re sharing our insights with you.
1) It’s All About Omnichannel Agile
- Shoppers now have over 800 possible paths to purchase available to them (Cisco).
- There will be 13.5 billion consumer connected “things” by 2020 (Gartner).
- One in three shoppers has purchased from a company or brand other than the one he or she intended to because of information received in the moment (Google).
Think back 20 years ago. There were no smartphones. No Twitter. No drones or retail robots. Now new digital devices appear out of nowhere and rise to mainstream adoption in increasingly short time frames. This pace of change will only continue to increase, leaving an increasingly complex path to purchase in its wake for you to manage. For this phenomenon, omnichannel gives us little advice on how to manage, other than to do the impossible, optimizing every single touch point to give shoppers a seamless experience every time, everywhere. Ultimately, this approach will only lead to a massive, unmanageable technical and process complexity, high costs and siloed channels.
Instead, brands and retailers need to be laser-focused on gathering insight from consumers in as close to real-time as possible and adopting more agile strategies—not just online, but in-store as well. As Forrester describes it, agile commerce is embracing a mantra of constant change, organizing your brands and stores to “Win Quick or Fail Fast” and “Learn by Doing,” by embedding agility and customer insight into your decision-making processes and shopping experiences. The key is to start by understanding your shoppers and their journeys—concentrating on common customer journeys then designing touchpoints within the context of those journeys, not the opposite way around.
2) Foot Traffic May Be Slowing, But In-Store Conversion Is What’s Alarming!
- Brick-and-mortar sales in the first quarter of 2016 accounted for over 92% percent of total U.S. sales (U.S. Census Bureau).
- 88% of in-store displays go unnoticed by shoppers (POPAI).
- Two in three shoppers who tried to find information within a store say they didn’t find what they needed, and 43% of them left frustrated (Google).
Here’s the thing… If you decided to run an email campaign online, you’d make sure to measure that email’s performance wouldn’t you? Then, if you saw low open and click rates, you wouldn’t just keep sending that email would you? Well, why would you do that in-store? As a brand, chances are you don’t know how many shoppers walk by your brand’s products or displays from one retailer to the next, let alone understand conversion of your campaigns or POP displays. And, as a retailer, chances are you don’t know how many shoppers walk through your categories/departments, let alone understand conversion per square foot.
In-store, what’s working and what’s not continues to be guided by laggard POS sales data, rather than conversion and ROI metrics. However, advances in in-store analytics are changing the way you can look at your physical channels. You can now get real-time insights, including shopper behavior, POP/merchandising/display or category/department conversion and demographic metrics.
With over 92% of sales and the majority of purchase decisions happening in-store, how much are you actually losing?
3) Shoppers Want Self-Directed, Online-Like Experiences In-Store.
- By 2020 a customer will manage 85% of the relationship with a company without interacting with a human (Gartner).
- 69% of shoppers say they would be more likely to buy if given self-help options in-store like digital displays or kiosks (InReality).
- 46% of shoppers stated that they usually know more than the sales associate (InReality).
- Digital interactions were estimated to impact 64 cents of every dollar of spent in-store in 2015 (Deloitte).
- Shoppers who use digital while they shop in-store convert at a 20% higher rate compared to those who do not use digital as part of the shopping process (Deloitte).
Seasoned by online shopping and digital tech conveniences, empowered shoppers are increasingly expecting to lead their own journeys. This expectation has extended in-store. But, while shoppers want digital in-store, they’re past digital for digital’s sake. Shoppers want digital that offers them real value and that’s “similar” to what they’re experiencing online. For example, shoppers want to utilize digital for researching, locating, checking inventory, ordering etc.
To meet this demand and take some more control of the customer interaction (and the data it produces) brands and stores should be looking at interactive signage and displays, store directories and kiosks that allow shoppers to help themselves. Some retailers are even using robots. Lowe’s for example, has been developing OSHbot, a customer service robot that speaks multiple languages and helps shoppers find items. And, Best Buy has begun using Chloe, a robot that retrieves products that customers request from a kiosk.
4) To Influence In-Store Shoppers Use Real-Time Personalized Or Location-Based Marketing.
- One in four shoppers say they have changed their minds while in a checkout line after looking up details on a smartphone (Google).
- 75% of shoppers said they would be more likely to buy in-store if given personalized offers/promotions delivered in the moment (InReality).
- 53% of shoppers are willing to share their current location to receive more relevant advertising (JiWire).
For many, it’s becoming an increasing challenge to influence shoppers in-store. But, location-based marketing via beacons has a proven track record of influencing shoppers in-store. And, while these methods are most associated with pushing coupons and discounts to consumers who are shopping in-store. Beacons are actually useful for a wide variety of retail purposes like product discovery, planning for shopping trips, and aiding in-store pick-up.
Another method, real-time content via remotely managed digital screens in-store can also be used to deliver highly relevant content by day/time, location, region, age or even gender. It has already been shown in the online world that targeted, personalized marketing is more effective than mass. So why, wouldn’t the same apply in-store?
5) Mobile Drives In-Store Sales.
- 50% of consumers who conduct a local search on their smartphone visit a store within a day, and 18% of those searches lead to a purchase (Google).
- 82% of shoppers say they consult their phones on purchases they’re about to make in a store (Google).
- Google searches with “near me” have grown 2.4X year-over-year (Google).
- Following a mobile search, the majority of purchases happen not online, but in a physical store (73%) or on the phone (16%) (comScore).
Mobile doesn’t just drive e-commerce—it actually gets shoppers into local stores, making purchases. Mobile will continue to be an integral part of the shopping experience both in- and out-of-store. Brands and retailers therefore need to have a coherent mobile strategy that provides shoppers with what they want including personalization, promotions, loyalty value, etc. And, it must start playing into the in-store experience where it continues to have the biggest impact.
The reality is you have limited influence on the modern shopper’s complex path to purchase. But, the in-store experience, where over 92% of all retail sales take place (U.S. Census Bureau), is a ripe opportunity for you to start gaining results. Things such as real-time, digital content in-store and self-help digital implementations (kiosks, interactive displays, etc) will increase purchase likelihood. More importantly, advances in in-store analytics will help you get the visibility you’ve been lacking to measure conversion, rather than just sales, so you can really see what’s working and what’s not, adopt more agile strategies and make your physical channels work harder for you.