Retailers are going to have to offer a richer and more personal shopping experience - both online and on the high street - if they are going to increase sales during the coming year, according to a global retail trends and forecasts report from Play.com's operator, Rakuten.
In a year where the global economy expanded at a slower pace than many had hoped, retailers worldwide continued to see sales grow considerably on the web. Estimates have suggested that the global e-commerce industry would generate some US$1.2 trillion in sales by the end of 2013, driven largely by rapid growth in Asia and the changing shopping habits of consumers worldwide.
But during 2014, global e-commerce sales are expected to top US$1.4 trillion for the first time as more consumers use mobile and tablet devices to shop. However, 2014 will not be a year for retailers to rest on their laurels. Shoppers are looking for a richer, more personal shopping experience and retailers must reassess both how they sell and what they sell if they are to thrive.
Consequently, Rakuten has outlined its top five global trend predictions for the retail industry, as follows:
- Content shopping will be king
The lines between entertainment and shopping are blurring further and 2014 will see more retailers offer shoppers a richer, content-led shopping experience. Driven by the media, which have become retailers in their own right to bolster dwindling revenues from advertising and subscriptions, savvy retailers are using multimedia content to make the shopping experience more engaging. Retailers recognise that shoppers are no longer satisfied by the vending machine model of the last decade; they want to be entertained and informed as they browse the web and make purchasing decisions.
- Social will steer retailers' stocking decisions
Social media's power to influence what people buy is widely recognised and in 2014 it will also influence what retailers sell. The rapid growth of social curation communities like Pinterest, where consumers curate their own collections of products that they like, offers retailers access to invaluable insights in near real-time, something that traditional market research simply cannot compete with. Savvy retailers will use social shopping communities as a temperature check for popular product trends and use this insight to inform and refine stocking decisions accordingly.
- Omni-channel will require a single customer view
Retailers understand that shoppers often interest with them through multiple channels, but what actually happens along this journey can be a mystery. In any given day a shopper could interact with a brand on multiple devices and through multiple platforms, from mobile browsing in the morning, to lunchtime shopping on a work laptop or liking a product in a social news feed later in the day. In 2014, a top priority for retailers will be to join up the dots between these channels so that a more comprehensive customer profile can be developed. Insight garnered by analysing the purchase journey of shoppers will help retailers to streamline the channels through which they sell and personalise the shopping experience, helping to boost their bottom line.
- Hyper targeting will take the online personalisation in-store
The long-held dream of being able to target shoppers in real-time, with relevant and personalised, location-based offers took a big step forward in 2013 with Apple's launch of iBeacon, which allows precise, low-cost indoor tracking in stores. There has been much excitement about the prospect of hyper-targeting shoppers on the go and in 2014 retailers will begin to take this proposition more seriously. We expect to see a number of high profile trials of hyper-targeting technology as retailers grapple to deliver the highly personalised experience that shoppers now expect online in their high street stores.
- Mass customisation will make products feel personal
Consumers today don't just want run-of-the-mill products, they want something that's unique and reflects their personality. Retailers understand this and we are seeing more companies offer personalised products, from custom engravings to the ability to select bag zip or pocket colour in advance. As this trend gathers pace in 2014, there is a huge opportunity for small to medium enterprises to carve out a market niche against bigger retailers, while adding value to existing products through customisation. Furthermore, the concept of customisation should extend beyond the product itself; retailers need to look at how they can offer a more customised shopping experiences online by using insights gathered in customer profiles.
"In 2014, retailers will have access to more information about their customers' preferences and shopping habits than ever before. Used intelligently, this insight will not only shape what products retailers stock but also how they market and sell them," concluded Shingo Murakami, managing director for Play.com. "So, as more shoppers embrace multiple channels when shopping, retailers must take steps to better understand the journey that customers take. This will give them the understanding they need to develop relevant content and personalised deals, and ultimately help to generate more sales."