The retail industry has seen many changes over the course of the past year.
Supply chains, for example, experienced massive overhauls. The concept of "supply and demand" was literally, figuratively, and technologically transformed overnight to meet consumer needs despite the debilitating restrictions that hammered down brick-and-mortar retailers.
Necessity is the mother of all invention, of course, and the technology sector was quick to develop solutions that supported the changing times. Technological advancements emerged in the form of telehealth innovations, contactless payment options, robotic delivery methods, and even new eCommerce upgraded solutions that harnessed the power of advanced artificial intelligence and machine-learning personalization capabilities… and the list goes on.
These advancements and innovations are here to stay. The retail industry has been opening back up, which means that both brick-and-mortar and eCommerce retailers are going to have to re-envision how they do business, and gradually implement new solutions to stay current, if they want to stand out from the competition.
Heading into the future, retailers will face the following five challenges:
- • Almost Every Interaction Will Become Digital
- • Experiential Spending Will Evolve
- • "Privacy" Will Become a Battleground
- • Social Commerce Will Dominate
- • A Brand's (Unethical) Past Could Come Back to Haunt Them
As intimidating as those challenges may appear, there are actionable upgrades you can implement at your retail business throughout the next year that will naturally help you overcome those challenges and stand out from the competition.
A great starting place is to commit to the following five improvements:
- • Increase Operational Flexibility
- • Focus on Digital Marketing Strategies
- • Inspire and Retain Employees
- • Meet Rising Consumer Expectations
- • Implement New Technology Solutions
In this article, we will look at the coming changes in retail, the biggest emerging trends within the retail industry, and the next steps you can take to ensure that your business keeps up with the evolving retail landscape.
COMING CHANGES IN RETAIL
The role and purpose of physical retail stores has shifted, plain and simple. Over the course of the past year or so, we saw smaller retailers permanently close in a domino effect while massive corporations like Amazon ate up the dying little guy's customer base.
Savvy brick-and-mortar retailers who were determined to stay in business quickly launched eCommerce sites, but soon struggled to compete with the Big Box retailers who had perfected their online operations and offered the lowest prices possible.
Startups, small retailers, and newly formed eCommerce stores went through yet another trial-by-fire, refining process that only allowed the best to survive. Based on the traits of those surviving businesses, we can now look back, reflect on what they did right, and adopt their strengths.
Those surviving retailers did what they had to do, and you should too, if you want to be ready for the coming changes in retail. Let's take a look.
Less Products & More Experiences
The days of consumers relying solely on physical stores to purchase their goods and necessities are disappearing fast. With online behemoths such as Amazon devouring the king's share of the consumer wallet, small brick-and-mortar retailers will have to pivot their funds away from inventory and towards in-store experiences if they want to draw in a crowd. By narrowing the variety of on-shelf inventory offered in-store, smart retailers are able to use the vacant space that results to host experiential activities. This type of retailer is called a "concept store." Nike's flagship store located in Times Square has an indoor basketball court. This is an excellent example of a concept store that draws in a huge crowd.
Less Conversions But More Converts
The primary purpose of retail marketing will no longer focus strictly on converting consumers into customers, which places an obvious emphasis on "selling." Instead, retailers will market their brands in such a way that inspires consumers to want to stand with the brands themselves. Rather than buy goods, consumers will first buy into the brand that is selling the goods. When consumers fall in love with a brand's ethos, ethics, and values, they quickly become converts. By placing an emphasis on turning customers into this type of "convert," retailers will effectively gain customers who are disciples of the brand itself.
Less Interruptions & More Value
Collecting customer data should be considered an art, first and foremost, and not a sterile set of technological protocols. The art of collecting customer data takes finesse, excellent timing, and minimal interruptions. The typical customer data collection practices among retailers, which involves various methods of asking customers for personal information, has started to backfire. Customers have become annoyed by the mindless, robotic interruptions they encounter whenever they're simply trying to shop online. Artificial intelligence isn't impressive when it's presented in the form of a rude robot that won't take "no" for an answer. Offer your eCommerce site visitors the value they're looking for, instead. By offering customized, enjoyable website experiences first, you'll have an easier time of collecting relevant personal information from your visitors later.
Less Traditional & More Ephemeral
Today's younger consumers, who will dominate the consumer market for the next fifty years, are insatiable. Whether their short attention spans are a virtue or a vice is irrelevant. Their browsing habits and shopping preferences will dictate which retailers end up succeeding and which will go under. For the average millennial, the only kind of mall they're interested in is one that resembles an art gallery. By offering plenty of visual stimuli with artistic pop-up installations that convey interesting messages, brick-and-mortar retailers can attract and entertain the kinds of customers who will post photos of every stage of their shopping experience on social media.
Less Average & Much More Remarkable
The entire retail market has been contracting and expanding like a woman in labor, and the birth pains experienced by retailers today is no less excruciating. The new, experiential, ethics-based retail businesses that are currently being birthed during these changing times will be extraordinary. Any ordinary retailers who happen to be standing today will topple to the ground tomorrow. As the future unfolds, the retail industry will slowly kill off the "average" businesses, making room for much more remarkable retailers. It's time now to keep up with emerging retail trends, which is what our next section is all about.
KEEP UP WITH THESE EMERGING RETAIL TRENDS
The business analysts, tech developers, and marketing specialists at FTx Solutions got together and compiled a list of the six biggest trends that have begun to emerge in the retail industry. If you want to stay ahead of the curve, build strong relationships with your customers, and elevate your brand in such a way that increases your revenue, then bear these emerging retail trends in mind as you analyze your business and implement new solutions.
A convenient melding of eCommerce and social media, "social commerce" offers consumers a way to shop on their favorite social media platforms. By offering your customers a native, in-app shopping experience on social media, you will not only greatly increase your chances of retaining your current customers, but you will also become discoverable to new customers who are searching hashtags to find retailers like you.
Influencer marketing has quickly evolved, and it was never that easy to begin with. What began as a marketing strategy that used the partnership between an influencer and a brand to promote the brand's products has since been infiltrated by traditional advertisers. Consumers can tell, too, and they don't like it. When social media users see their favorite account post overly polished, professional photos of their idol posing with branded items, all they see is an ad. This has totally defeated the purpose of partnering with an influencer, which is why influencer marketing that actually works uses authentic, candid, unrehearsed, and unscripted social media photos and videos.
Ecommerce Into Brick-and-Mortar
My, my, how the tables have turned. Brick-and-mortar stores have bent over backwards to launch eCommerce sites and many of them ended up permanently closing their physical doors in favor of focusing solely on their online operations. So, why would we include the opposite scenario on our list of emerging retail trends? Because it's true and you need to know about it. Ecommerce brands are now opening physical store locations. A prime example of this is Amazon. The online retail giant recently opened Amazon Fresh, a grocery store in California, and we can expect more Amazon stores to crop up across the country.
Augmented Reality Shopping
The increase in online shopping has necessitated swift technological innovations so that at-home shoppers can experience in-store shopping… or get as close as technologically possible to the real thing. This is where "augmented reality" comes in. Augmented reality, or A.R. for short, is the customer-side experience of machine-learning A.I. that is designed to provide online shoppers with a virtual reality experience of a store's physical products. A.R. helps customers conceptualize physical products by providing highly realistic digital versions.
Ethical & Values-Based Brands
In the era of cancel culture and virtue signaling, a brand could be obliterated in the blink of an eye. If you think your competitors aren't willing to hunt seven-years-deep into your Twitter account until they find a "questionable" tweet they can use to take you down, think again. Say what you will about cancel culture, it's here to stay because the people who ascribe to the cancel culture mentality are here to stay… and they're also paying consumers. Brands that have strong ethics and place their values at the center of their business are going to succeed as the future unfolds.
Faster Than Same-day Delivery
If shortened attention spans are a dominant character trait in today's millennial consumers, then impatience is right up there alongside it. Years ago, the speed of delivery for online orders was never really criticized. Receiving a package a week after placing an online order was acceptable if it meant keeping delivery fees as low as possible. And for anyone who wanted their order delivered ASAP no matter what the cost, a two-day delivery timeline was considered great. But COVID changed all that. Throughout the past year, consumers became experts at shopping online and began to judge and rank eCommerce sites based on the expediency of their delivery methods. The result? Not only do today's millennial consumers want their orders shipped same-day, they want them delivered same-day, too. The future of retail will include drone delivery in order to fulfill faster than same-day delivery expectations.
THE NEXT STEPS FOR YOUR BUSINESS
Now that you understand the coming retail changes and the biggest emerging trends in the retail industry, it's time to look to the future. What steps can your retail business take today to stay ahead of the curve? We've put together five "next steps" you can use. Each one focuses on improving a different area of your business. These are the actionable steps that we implement for our clients and we're confident they'll work for you, too.
Make 1:1 Personalization Your Goal
Right now, personalizing your marketing campaigns so greatly that each customer receives a distinctly personal message isn't possible. But with today's technology, you can come pretty close to 1:1 personalization. Segment your customers into the smallest, most specific groups as you can for the time being, and send out campaigns that are customized for each group.
Implement Tech Upgrades
Very few retailers currently utilize the latest technological solutions, but that doesn't mean you shouldn't implement the tech upgrades that you can afford today while educating yourself about the technological advances that are soon to come out. Brick-and-mortar retailers should invest in digital signage, an intuitive Point-of-Sale system, a customer loyalty rewards program, and the best digital marketing they can afford, which should include redesigning and / or redeveloping their business websites. Online retailers should invest in digital marketing solutions with an emphasis on social media marketing, and it never hurts to launch a loyalty program, as well, so long as your eCommerce site includes all the technological bells-and-whistles.
Provide Enhanced Experiences
Today's shoppers are looking for experiences in addition to looking for products. In the future, this consumer expectation will naturally evolve into a need for highly personalized product recommendations and an augmented reality shopping experience that might even include intelligent virtual shopping assistants. Start meeting consumer expectations right now by providing enhanced experiences today whether you own a brick-and-mortar retail location or an eCommerce store.
Market Brand Authenticity & Ethics
Regardless of how you have been framing your marketing and advertising messages, you can reshape them right now. Instead of straightforwardly promoting your products, try indirectly promoting them by placing your brand's ethics at the center of your marketing campaigns. This tactic will help consumers perceive the authenticity of your brand, which will ultimately cause them to emotionally connect with your brand. Once this personal relationship is formed with your brand, consumers will be eager to buy from your business.
Emphasize Customer Appreciation
It's impossible to appreciate a person if you have no idea who they are, and it's impossible for a person to believe you appreciate them if they know you don't understand the first thing about them. Customer appreciation starts with getting to know your customers. Show you know who your customers are by offering them discounts and deals on their favorite products. The final key to customer appreciation is making sure you provide excellent customer service that offers multiple channels of communication including phone, chatbots, social media DMs, and even responding to questions in the comments sections under your blog articles.
IS YOUR STORE READY FOR THE FUTURE OF RETAIL?
FTx provides retailers with the business solutions they need, and we're especially excited about one particular solution that will be coming to market soon—FTx Commerce.
As an online ordering platform, FTx Commerce will provide retailers safe, secure, and efficient online ordering solutions that include curbside pickup and delivery service options. Though FTx Commerce has yet to be launched, you can use limited aspects of the platform with FTx Cloud POS.
Be sure to sign up for our newsletter to be the first to know when FTx Commerce is fully formed and fully functional. At that point in time, the complete FTx Commerce SaaS package will easily integrate with your current POS system, offering retailers like you an online ordering platform you can trust that ensures your inventory is always accurate and updated in real time. Contact us today to find out more about FTx Commerce and what this SaaS solution can do for your business!