Why I don’t believe in “The Retail Apocalypse”

So much is being written about a “retail apocalypse” and many spent 2017 talking about the death of brick and mortar.

However, despite what pessimists might say, shoppers and data are telling us a slightly different story and the stats just don’t support such a doom and gloom situation…

  • 4,080 net new stores opened in 2017 (more than the number of stores that closed)
  • 71% of US shoppers still prefer to buy in-store (even if the product is available on-line)
  • 85% of US shoppers want to shop in-store because they want to “touch and feel” before they buy
  • 66% of millennial find store associates “extremely important to their shopping experience”

Sure, certain categories like Fast Fashion and Beauty have taken a hit in-store, but 2017 saw significant store count growth for the Dollars (General and Tree), value brands like T.J. Maxx, Grocers; Lidl and Aldi and beauty brands Sally Beauty and Ulta are demonstrating that brick and mortar retailers are still essential in today’s shopping ecosystem.

An evolution is taking place and brick and mortar retail is at the core.

What is changing are shoppers expectations and what they are looking for when they walk into a store. The right assortment at a good price is no longer enough. Today’s shoppers want more AND they want what they want immediately and they want to have an enjoyable experience. The “currency” of shopper satisfaction is now comprised of Value, Convenience, Discovery and Experience tightly wrapped in Personalization and topped with a shiny bow that is Technology.

While this may sound complex, it represents an opportunity that brick and mortar stores are uniquely positioned to deliver if they take advantage of all of their assets and ensure they are working together toward a common goal of delivering on what the shopper wants. By leveraging an entire store environment, associates on the floor, internal systems/operations and the right technology, retailers can create a “surround sound” affect to ensure the shopper walks out satisfied.

To do this, brick and mortar retailers have to abandon the “one size fits all” approach and move towards having a variety of store footprints that can deliver different brand and shopping experiences. Showrooms, express, pop-up, shop in shops (and a few that have yet to be revealed) all have a purpose and are here to stay. Within those store types, successful retailers can define the role of their associates and provide them with the proper tools and tech to support all shopper needs from basic fulfillment to expert advice. Systems and operations must move beyond self-check-in and inventory-control to be truly connected and assist in the delivery of a seam-less, frictionless, even channel-less shopping experience. That is what shoppers want and expect today – even if retailers aren’t structured to deliver it that way. Connecting on-line to off-line is a retailer problem, not a shopper’s, and connecting all of their systems and operations is the way to do it and make it personalized.

Brick and mortar retailers must become more agile and nimble, accept that partnerships and acquisitions are necessary to remain relevant and succeed. And most importantly, retailers must understand that piloting, testing, measuring and learning are essential and critical to continued success.

Written By: Tracy Faloon, TPN Chief of Client Integration

 

Sources: IHL Group, TimeTrade survey, ChargeItSpot Study, Fortune, ChargeItSpot Study

CES2018: Reflections and Looking Forward

After a few days’ rest and some time to digest my experiences at CES 2018 last week, one things for certain: we are moving at a consistent and fast pace into some pretty amazing times. And I’m not talking about robots. Well, maybe I am… as long as they do not call me “master”, because that’s just weird.

No, I’m talking about the convergence of technology advancements that are all happening at once. In previous years, many felt overhyped. But now I feel certain in my prediction that my kids won’t need to learn to drive a car. It’s like we are headed to a new point on the horizon. And it’s going to be glorious… well, and quite scary for some.

AI is the new data

Last year’s CES was overrun with sensors providing data and metrics. Now artificial intelligence is here to provide the big “so-what” to all that data. AI enabled was the term to use when talking about personalization for all manner of items ranging from sports to health to food. While AI is the underlying tech connecting all the items below, 5G is providing the bandwidth.

Everything is connected

Sensors, IoT, whatever… now my toilet is connected and my baby’s bottle is tracking feeding.

The connected home was in full swing at CES. And, as opposed to last year, “smartified” products told a more complete story. Of course to a hub/each other, but also to content services like how whirlpool partners with yummly or how a folding clothes machine wants to be your fashion expert. And how will we interact? While many of the appliances sported touch screens, the dominate interface was voice.

Voice is the Interface

Since Alexa boomed onto the CES stage last year, we’ve been talking about the emergence of the conversational interface. Well, it’s here. Prior to the show, there was tons of discussion about who would win? Alexa or Google Home…. Despite Google’s best effort, I still felt Alexa had the upper hand with integrations, shopping, and being embedded in household objects. But a greater feeling was how similar the situation was to iOS v Android and there’s room for both (maybe Bixtby as well?) to coexist. With the rise of voice, inevitable questions come up like how will it impact mobile usage (people will use mobile less) and what does it mean for brands (a voice driven world will be a game changer).

Autonomous vehicles are close

Yes. I know they are actually here. But they are getting closer to being a reality for me. And I can’t stop thinking about how it will impact delivery. It’s become easy to imagine my Amazon/Blue Apron/Pizza packages will be delivered by a self-piloted shipping pod (Dominos and Ford partnered to show a pizza test solution right out of a recent Black Mirror episode).

We aren’t getting enough rest

Last year, we weren’t drinking enough water. “High tech” water bottles were everywhere. This year, AI driven mediation, sleep, and rest technology was peppered throughout.

The evolution from “I bought it online” to “it’ll be here in 2 days” to “it’ll to here in 2 hours” is on the trajectory to “Ben, this is your future assistant. Just letting you know I saw you had a stressful day. Your kid will be home from practice on Pod XYZ in 45 minutes. She has not done her homework yet. I’ve warmed up the shower for you to relax in and have picked out the family dinner for the evening. The ingredients are in the fridge.”

Or maybe it won’t say that. It will just do those things as we move from convenience and personalization to prediction.

Written by: Ben Gauthier, TPN VP, Innovation + Technology

2013: The Year of Deal-Seeking

Google released its top-searched items of 2013, and Kohl’s, JCPenny and Nordstrom graced the top spots on the apparel brands and retailers list.  Following the top three included Forever 21, Old Navy and Macy’s.

What do these retailers have in common?  All were searched along with terms that indicated shoppers were looking for a deal or price reduction.  For example, Nordstrom shoppers were most likely looking for Nordstrom Rack in their searches.

But this trend of looking for good deals is not exclusive to online retailers.  Shoppers are also more likely to negotiate prices in-store, thanks to multiple resources.

Brick and mortar shoppers now have an arsenal of never-ending resources in the form of smartphones.  Price-checking in-store, or showrooming, has quickly become the norm, and retailers have had no choice but to find creative ways to fight back and ensure in-store sales remain strong.

Best Buy is one of those retailers and is offering a price-match guarantee this year.  What does this mean?  Customers can bargain.  Prices are no longer set in stone.  If a shopper finds a cheaper price online, Best Buy will work with them to keep that sale in-store.

The future of retail is changing rapidly and with each new technological advancement, shoppers get smarter about what they are willing to pay for products and services.  Brands and retailers will also have to continue to get smarter, adopting new technologies and policies that will ensure both in-store and online channels thrive.

Social Media, Branding Superhero

Inc. Magazine recently featured a post about whether social media is more advertising or PR. The author believes that social media can be either, depending on a marketer’s goals or objectives. My Millennial opinion: Social media is its own entity.

PR is message and communication management, a key aspect of social media. Advertising is focused on business strategy and achieving measurable results based on set objectives. Any social media promotional campaign that depends on conversion as a success factor harnesses the skills of advertising.

I agree with the author that social media can be what a client needs it to be and can lean toward PR or advertising, depending on the objective. But, as a whole, social media is the future…happening now.

The fact that social media can tackle the demands of PR and advertising in one fell swoop gives it a power that neither PR nor advertising can have on their own. It’s a medium that gives anyone the power to become a brand — and that’s exactly how my generation is using it.

We are setting the future of business by branding ourselves without the assistance of PR or advertising, but instead using social media. And thanks to this special medium, when consumers set trends on Facebook, Twitter or the like, brands tend to follow in their footsteps. If you’re wondering who is really in control…look no further. Consumers and Shoppers. They hold the power in today’s dynamic retail ecosystem.

And mark my words, the more prominent social media becomes, the more brands will begin to test its limits in ways no one could ever imagine with PR or advertising alone.

Feature photo credit: ViralBlog