The holiday season is over and the weather is starting to warm up. Retailers are replenishing their stores with fresh spring merchandise. Zacks Equity Research recently discussed the retail industry and rapidly changing trends for the future.
Spring means fresh merchandise in addition to Easter items. Home and garden retailers are preparing for their busiest season of the year. Based on recent trends, retailers will not only flood the physical stores with attractive offerings for the season, they will also offer lucrative online deals to capture a larger share of total sales. Omni-channel retailing is not only here to stay but is driving rapid change in the retail industry.
The National Retail Federation (NRF) projects retail sales in 2016 to rise 3.1%, which is higher than the 10-year average sales growth. Online sales in 2016 are expected to increase somewhere between 6 and 9 percent.
On the final day of NRF’s BIG Show in January, Marian Salzman, CEO of Havas PR North America, noted that two trends are here to stay: First is the growing uneasiness in everyone’s lives and the second is an addiction to the tech world. With these trends affecting almost all consumers, it is critical that the retail industry innovate new ways to make life easier for people and complement their love for digital devices.
With the increasing influence of technology on consumer buying patterns, the general retail industry trends set to rule the future are noted below:
- Omni-channel Eliminates Retail Pure-Plays: Omni-channel, which emerged as an option to offer more touch points and multi channels to customers, has gone beyond this simple value proposition. This cross-channel phenomenon now requires every retailer, whether originating online or brick and mortar, to bring together both physical and digital systems to serve omni-customers. Online retailers are coming up with physical or pop-up stores to satisfy customers. The objective is to bridge the gap between a physical and an e-commerce store of any retailer. Macy’s also makes the most of its omni-channel presence with services like click-and-collect. Additionally, the company’s site allows the customer to view the inventory at its local stores so they can check the availability of a product at their nearest store, purchase it and either pick it up or even arrange for same day delivery in some cases. Macy’s mobile app allows customers to scan bar codes of products at stores and check available online reviews or promotions.
- Expanded Payment Options: With the retail industry undergoing such massive change, the modes of payment while shopping have evolved dramatically. The increasing use of mobile payments and the EMV mandate in the United States induces retailers to remodel their payment terminals to accept multiple options like mobile payments and EMV cards. Some of the available solutions include Mercury, Poynt, and the PayPal Here chip card reader, all of which equip retailers with different ways to accept payments.
- Technology-Friendly Brick-and-Mortar Stores: With shoppers becoming increasingly tech savvy, brick-and-mortar stores need to leave their old-fashioned layout behind and improvise by adopting innovative in-store technologies. The simplest way to execute this is though in-store mobile devices, through which customers can make payments, see product demonstrations, gather information and connect to social networks. Retailers are also exploring new ways to use mobile apps in store. Such apps will track customers as they shop and send them to tailored offers on products in sections they are in; recommend items based on past purchases; or allow them to program automated shopping lists.
- Reinvention of Loyalty Programs: With perpetual changes in retail industry trends, the importance of rewards and promotions for customers has been taken over by value, track record and convenience. As a result, the traditional loyalty programs have to be enhanced with customized rewards, great products and buying convenience in order to be successful. Another method that retailers are now adopting to draw consumers involves going beyond purchases to reward consumers for their transactions and engagement. For example, DICK’S Sporting Goods Inc. recently introduced the Move feature to its mobile app, which allows customers to connect their fitness tracking applications like MapMyRun and Fitbit to DICK’S ScoreCard points in order to earn rewards for attaining activity goals.
- Impact of Social Media: Over the past several years, retailers have been using social media platforms to advertise their brands, launch products and campaigns, talk to customers and even make merchandising decisions. Retailers are now selling their products through networking sites like Facebook, Instagram and Twitter, which recently added shopping functionalities. Some retailers who have already adopted this capability include Nordstrom and Target, which are both using the Like2Buy platform on Instagram.
- Emerging Markets: Having tapped a great deal of the potential in the domestic market, the U.S. retail industry has started venturing into emerging markets. Most retailers are witnessing growing demands for their products in countries like Brazil, the Middle East, China and India. Retailers planning to venture into these markets include the likes of V.F. Corporation and Tiffany & Co.
Modern technology and consumers demands for ease and convenience of shopping are changing the retail industry faster than ever before. As things are so rapidly evolving, it is essential that the retail loss prevention professional continually learns and keeps abreast of these changes, their causes and their effects. Shoplifting in brick and mortar stores may remain relatively the same but it’s a given fact that thieves and fraudsters will keep up on the changing trends and technologies and use them to their advantage. LP has to stay in the know and evolve just as fast with preventative measures to deter theft and loss in this new age.