January 10, 2018 20 Retail Experts Predictions for 2018 (II): The ‘Retail Apocalypse’ Myth
Following up on the previous post, we continue sharing what our experts revealed. In this part of the survey, we wanted to know what is going to happen with this so-called ‘retail apocalypse’ that the media has been talking about.
Is e-commerce going to take over brick-and-mortar? Are physical stores going to disappear? How is retail going to reinvent itself?
Keep reading to discover the answers.
The ‘Retail Apocalypse’ Myth Through Retail Experts Predictions
In the second part of our survey, we asked our expert respondents:
The “Amazon effect” is feeding into the retail apocalypse, as sales slump and stores close at retailers like Sears, Macy’s, and Toys R Us. Brick-and-mortar stores are struggling to keep up with their online competition.
What are your thoughts on the future of stores?
1) Stores are not going anywhere
Their reaction to this so-called ‘retail apocalypse’ was that it’s merely a “restructuring” of retail, a “redesign” of stores, or even a “call-to-action” to retailers.
As a matter of fact, retail is always evolving and this time the evolution is being led by innovative technologies like AI, real-time data, new software solutions and more.
“The biggest myth circulating today is that Amazon killed Sears and Toys R US. Every un-informed business journalist starts articles about retail bankruptcies with a reference online retail.
What we know for sure is that retail capacity has grown by 30% in the last twenty years. We can also see chains have refused to invest (Sears) and update their brands and in-store experiences (Toys R US). They deserve their fate. Internet taking 10% off of their sales is the final blow, not the main cause.” – Mark Satov, Satov Consultants Inc.
The media has been insisting on the idea that retail is dying but, as Brian Kilcourse from Retail Systems Research puts it, “people will always want to shop – it’s how they shop that is in flux“.
Brick-and-mortar stores won’t become obsolete. They will become different. In fact, smart retailers aren’t struggling to keep up with their online competition. They are embracing their own online operations in order to provide consumers with maximum flexibility in the way they can shop and buy. – Mike Cassidy, Signifyd
Our reporter from MediaPost states that stores are not going away, but the shopping experience has changed forever.
Rather than shoppers participating in a serial exercise, as in ‘I’m going shopping now,’ they are always and continually shopping. This new “Mobile Shopping Life Cycle” means that retailers need to be interacting with consumers on an on-going basis, not only when in a physical store. – Chuck Martin, MediaPost
2) Those that adapt will survive
Stores are in for a major redesign; one that focuses on an experience that blends the best of the digital shopping experience with the best of the physical shopping experience. If stores try to “stay the course”, and merely be a physical place where demand and supply meet, they will fail. – Brian Kilcourse, RSR Research
Brick-and-mortars need to change the way their traditional ways and integrate digital into physical, focussing their efforts around providing the best shopping experience – one that online stores like Amazon cannot.
Stores should ask themselves “what can I do that Amazon can’t?” The answer is…plenty! Consumer relationship with Amazon is purely functional and practical, our relationship with a retailer delivering great customer experience through great immersive stores is a far closer, more intimate relationship. – Andrew Busby, Retail Reflections
The act of buying commodities will become less of a chore. Players like Amazon will make this part of retail easier through offerings like auto-renewals, one-tap purchases, and same-day delivery. […] Meanwhile, the experiential side of retail — the part that involves discovering great products and socializing with others — won’t be going away.
How can stores survive? They need to create more compelling experiences. They need to evolve their store formats to cater to different markets and needs. Most importantly, they need to offer something (i.e. products, experiences, services) that people won’t find on other channels. – Francesca Nicasio, Vend Retail Blog
The Retail Doctor, Bob Phibbs, emphasizes the importance of store assistants and their human touch.
To grow brick and mortar will take a renewed emphasis on employee selection and retail sales training. People aren’t putting down their phones to have a beacon show them where the underwear they browsed online is – they’d just stay home. – Bob Phibbs, The Retail Doctor
Flexibility, convenience, information and reviews about products, and recommendation systems are traits from eCommerce that may be less obvious to recreate in a physical shop. However, technologies like product discovery apps are increasingly helping to bridge this gap.
And while there are things in the retail sphere that online shopping cannot replace, there are many aspects of eCommerce that can be adopted by physical stores.
Stores are not going away, they are getting smaller, acting as pickup locations for online orders and in some cases, offering more experiential perks — from food to classes. – Barbara Thau, Forbes
3) How does the future of retail look like?
The future is more about blending online and offline than choosing one over the other. Stores will need to bring in digital features, allowing consumers to interact with the products and the brands, and in the process stores will get a better understanding of consumers’ behaviors and needs. – Renato Müller, Käfer Studio
It’s all about merging all touchpoints into a single omnichannel experience where brands are constantly interacting with their customers and forging valuable relationships.
The mind-boggling amount of choice on the market right now is leaving customers confused and overwhelmed. A few decades ago there were five brands of running shoes. Now there are 20,000! For that reason, retailers have to become experts who can help their customers select the right products.
Shoppers want to be informed about products before they buy. They want to experience the products, understand them, and have convenient and unique experiences in real stores. Nobody wants to go to the shop just to pick up a box. – Markus Linder, SMARTASSISTANT
Interestingly, Natalie Berg mentioned that purely online stores are more at risk than physical retail. They lack that human touch and the ability to create immersive experiences.
Nevertheless, the future will not be physical or digital – it’s the blend of both that will retailers to keep growing, bringing customers to their online store as well as to their brick-and-mortar store.
The store of the future will be less transactional: instead, it must become a hub for both experiences and fulfillment.
Immediacy is no longer unique to brick and mortar: today, you can order a pair of shoes at 9am and be wearing them by lunchtime. Store-based retailers must capitalize on community, service and leisure while also ensuring a frictionless in-store experience.
Technology will continue to play a huge role in achieving the latter. In summary, we’ll see a growing divergence between functional and fun shopping. – Natalie Berg, Planet Retail
The online-offline divide will end as they merge into a combination of both, and another way of categorizing retail will emerge. There will be:
- A more functional and convenient way of shopping for purchases that require little involvement and can be automatized, versus
- Experiential shopping, where both technology and the human element come together to turn shopping into a fun activity.
Meet the experts
See again the list of experts that contributed to this round-up, providing great insights as to what to expect in the retail sector this new year.
|Andrew Busby, Founder & CEO at Retail Reflections United Kingdom|
|Barbara Thau, Contributing Retail Writer, Forbes United States|
|Brian Kilcourse, Managing Partner at RSR Research United States|
|Bob Phibbs, CEO at The Retail Doctor United States|
|Chuck Martin, CEO at Net Future Institute & Editor at MediaPost United States|
|Craig Patterson, Editor-in-Chief, Retail Insider Canada|
|Francesca Nicasio, Content Strategist & Retail Expert at Vend Retail Blog United States|
|Jasmine Glasheen, Writer & Generational Marketer at Retail Minded United States|
|Jeff Kagan, Wireless Analyst, Telecom Analyst, Speaker, Author & Consultant United States|
|Khahlil Louisy, Editor-in-Chief & Creative Director at BONNE New York United States|
|Joe Skorupa, Editorial Director RIS News United States|
|Krista Fabregas, Retail Analyst at FitSmallBusiness.com United States|
|Mark Satov, Founder at Satov Consultants Inc Canada|
|Markus Linder, Co-Founder & CEO at SMARTASSISTANT United States|
|Melissa Campanelli, Editor-in-Chief at Total Retail United States|
|Mike Cassidy, Lead Storyteller at Signifyd United States|
|Natalie Berg, Retail Insights Director at Planet Retail United Kingdom|
|Nicole Leinbach Reyhle, Founder of Retail Minded United States|
|Nikki Baird, Managing Partner at RSR Research United States|
|Renato Müller, Senior Content Strategist at Käfer Studio Brasil|