Technology is reshaping consumer behavior, and in turn, reshaping retailing. While the retail environment is ever-changing, we can make some predictions regarding the future of retail by connecting the dots of what we are already seeing in the marketplace today.
1. The difference between online and offline shopping will disappear. While some paths to purchase will continue to be exclusively online or offline, most will consist of a combination of the two. Wherever a shopper choses to purchase, their shopping experience will most likely contain at least one digital touch point, whether it be looking at a product in-store and purchasing online or researching product information online before purchasing in-store. A brand’s online presence will continue to be a powerful driver of offline sales. Brands will see that having an e-commerce presence creates a valuable touch point with shoppers, regardless of where the shopper makes their purchase.
2. Retail locations will increasingly serve as local fulfillment centers. Driven by the pursuit of logistical efficiencies, a growing number of retailers will recognize the value of serving in-store customers and local online shoppers with the same pool of inventory. We are already seeing this with a number of same-day delivery offerings that fulfill orders via local retail stores. Moving inventory closer to point of sale can mean offering greater selection for customers, lower shipping/storage costs, and fewer lost sales due to out of stocks.
3. Retailers will become channel agnostic. The act of browsing, buying and returning merchandising will pass seamlessly between online and offline. Each customer will find a comfortable way of managing flows of product, payment and information between themselves and their retailer of choice. Retailers that can adapt and respond to the preferences of their customers will quickly move ahead of their competitors.
4. Big Data will continue to drive micro-segmentation. Personalization is and will continue to be the currency of the web. Those retailers that can leverage the customer data in ways that are valuable without being intrusive will position themselves to build powerful bonds with consumers. This will drive sales of existing product and provide retailers with a powerful asset they can use to guide new product/service development activities.
5. Price transparency will drive innovation. Retailers unable or unwilling to compete on price will need to differentiate themselves through either a unique shopping experience or distinctive product assortment. Brand marketers will innovate to offer differentiated products to niche consumer segments. Store brands will continue to flourish as retailers uncover ways they can become a destination for a truly unique offering. Continue reading