Retail – It’s Time to Evolve or Die
Every morning we are greeted with the news of another struggling retail giant closing stores or posting profit warnings. Our retail environment is changing, it’s fast and it’s brutal.
The internet is often portrayed as the harbinger of doom, causing the death of the High Street and shopping centres. The Darwinian concept of “survival of the fittest” has never been more apt; today’s retail environment requires a willingness to adapt and re-evaluate what the buyer wants.
But for those who can change and adapt quickly and correctly, real opportunity awaits.
It would be fair to say we all buy online, however results showed that 89% of shoppers still go to brick-and-mortar stores to evaluate and purchase products — validating the value of the in-store experience. This is something we have seen at Halo through our on and off line marketing and promotional strategies for retail customers where we have created online shopping experiences, complemented by in store promotions that transition the consumer smoothly from one to the other. We still want to interact with what we buy. It’s understanding this interaction that is vital to survival.
Customers want an omni-channel experience where the customer can be shopping online from a desktop or mobile device, or by telephone, or in a bricks and mortar store and the experience would be seamless.
Manhattan Associates recently commissioned research that surveyed 2,000 retail professionals and 2,000 consumers. An overwhelming 77% of shoppers said they expect a seamless experience across channels, most of who said that consistency across channels would keep them loyal to a brand. Unfortunately, in most cases, this has yet to be achieved with 68% of respondents reporting they perceive noticeable differences between online and in-store shopping.
Brick-and-mortar retail is far from dead, but those retailers who fail to hear consumer desires for a new shopping experience risk extinction. For forward-thinking brick-and-mortar retailers, there’s a distinct way forward ― invest in technologies that break down the silos of information in your organisation and provide your employees the information they need to deliver a seamless omni-channel experience.
Retailers and landlords need to work together to re-purposing space, and create new leasing models.
ECommerce is growing and growing fast, yet only 17% of consumers are strictly digital. Retailers need to control the environment and enhance the shopping experience. They need to bridge the gap between online and instore, with strategies that combine online and instore into a cohesive customer experience.
At the World Retail Congress in Madrid, Kingfisher Chief Executive Veronique Laury laid out stark choices for retailers if they wish to thrive in the future. Legacy retailers can create modern businesses but the old models need to be adapted for the consumer. She also said that you cannot layer technology on top of stores. “People will have a different role, she said, reflecting that of the 78,000 people the company employs across Europe, “in the future we will probably need a little less but less in some roles, more in others.”
Kingfisher started the digitalisation of its business three years ago and Laury said that because as a DIY group it sells “projects not products”, there was a myth that this will not be sold online.
“Not true,” she insisted. “At Screwfix, 28% of sales are online. I really think you need to have both.
Amazon has kicked every other retailer to go a little faster. Their key has been the focus on customers, showing the way forward for all of us.
“If you think of a retailer as simply between the product and the consumer, then Amazon have won the battle. So we need to talk more about the offer, you have to do something more, around the service or the offer.”
To determine the future direction of the business she said Kingfisher would stick with what the customers want, not the business model. “It’s a challenge because you have to change the way you do everything,”she said, advising: “Be bold, brave, test and don’t wait until you know the answer. No-one has the answer.The real difference is the pace and how fast you have to change. Either you change or die.”