Yesterday’s amazing is today’s expected. That’s a vital point retailers(opens in new tab) need to understand according to Dana Telsey, CEO and Chief Research Officer at Telsey Advisory Group. Telsey provided an overview of the evolving retail landscape during NetSuite’s recent webinar, Revolutionizing Retail, as well as the key trends hitting the industry and the five top things what will transform the future of retail.
Trend #1: Consumers are demanding an experience, something they can touch and feel. This can be seen throughout multiple demographics but has been made imperative by the emerging purchasing power of the millennial generation. According to Telsey’s research, compared to baby boomers, millennials have greater discretionary spending, are tech savvy and demand convenience and digital interaction, while baby boomers often rely on customer service. As a result, forward thinking businesses are adapting to provide an experience for their shoppers in store, from virtual fitting rooms to yoga, and that is only the beginning.
Trend #2: The growth in ecommerce and mobile commerce is dominating market share. Given the shift in demographics where the internet and mobile functions are native to the experience of today’s buyers, purchasing online and through mobile will continue to dominate the buying experience.
Trend #3: Omnichannel and technology are changing priorities and shopping behavior. As we have seen with ecommerce(opens in new tab), a majority of shopping is being done online and the industry has had to adapt. New technology players are providing a more streamlined approach to the omnichannel buying process and shoppers are beginning to expect that experience.
Trend #4: Certain sectors are experiencing growth while others are declining. As Telsey mentioned, retail is a rollercoaster and it all comes back to the prefix re. Reinvent, remodel, and remerchandise. While some stores and business models might be in decline today, they will not be in decline forever. Retailers are having to reinvent themselves, their business models, and their brand strategy.
Trend #5: The retail space shift. Space left behind by struggling retailers is now being claimed by new growing and emerging retailers who want to set up their own brick and mortar operations. Although ecommerce and mobile commerce remain a major part of an omnichannel approach, to much of the industry’s surprise, consumers are still yearning for the instore experience.
Given these transformative trends, what will the future of retail look like?
Personalization, localization and customization will be key. No longer can retailers attract customers simply through targeted ads and promotions. To influence purchasing, retailers need tailored communication and shopping experiences. However, it is not one size fits all. Newcomers have built incredible brands by building an experience around personalization and customization. Along with building a more targeted approach to consumers, retailers will also need to fully deliver on the omnichannel experience. Convenience is key in the new age and payment efficiency; integrated systems and immediate gratification will only continue to dominate as speed and ease of use become the major buying influencers.
International expansion and global reach will also be a driver as brands expand at a much quicker pace. Delivery of international products and services are becoming much easier to produce using new technology that is readily available to consumers. Finally, we will be seeing retailers bring the store to the customer. Along with the personalization of the buying experience and convenience of shopping, retailers will truly focus on what their brand means to consumers and how best they can serve their customers.
NetSuite will also be hosting Dana Telsey as part of our Grow Live Tour in Los Angeles on March 22nd at Montage Beverly Hills and in New York City on March 27th at the Intercontinental New York Barclay both from 8:30 AM – 10:30 AM. Register here(opens in new tab)!