What are retail's main changes and trends up to 2010?
The future of the always-changing retail landscape is in the hands of consumers, with factors such as rising fuel prices forcing ordinary people to alter their shopping habits, according to analysts at ACNielsen.
And this challenging retail situation is here to stay, it seems. At the recent Consumer 360 Conference for the consumer packaged goods (CPG) industry, ACNielsen analysed the past, present and future of US retailing.
Coming retail trends According to Todd Hale, ACNielsen's Consumer Insights' senior vice president, the company foresees several changes in the retail landscape leading up to 2010, including:
- RFID (radio frequency identification) technology (see Using RFID for the latest details) will be widely applied to track in-store shopping patterns, stock merchandise, and measure consumption.
- In line with his first prediction, Hale also concluded that self-checkout facilities will be greatly simplified as these RF-based devices become common on supermarket shelves, effectively replacing bar codes with radio identifiers.
- Wal-Mart sales will reach the half-trillion dollar mark as the store becomes a leading source for immediate healthcare.
- More stores will begin to offer valet parking.
- Metal detectors will greet shoppers at store entrances.
- Private Label goods will reach a 20% share of consumer spending.
- Grocers will either go into "big", "value", "niche" - or financial trouble.
- High fuel and heating costs will continue to reduce shoppers' disposable income, causing channel evolution.
According to Hale, "Today's hectic lifestyles have changed the way people shop. What used to be a rather leisurely activity has turned into a rushed, stressful nuisance for some shoppers. Retailers that acknowledge this stay one step ahead of the game. These days, retailers are looking for ways to keep customers is to keep them happy by selling them unique products, getting them in and out of stores more quickly, smothering them with good service, and saving them money."
Retailer survival tips Hale therefore encouraged retailers to keep customers satisfied by altering business practices to focus on personalisation, value and convenience. He also suggested several "survival tips" designed to teach retailers to maximise their growth potential in the face of tightening consumer budgets:
- Benchmark and monitor shopper dynamics both by category and across the entire store;
- Think outside traditional channel categories by better understanding pricing, assortment and promotion strategies;
- Leverage manufacturer expertise to help stay ahead of consumer trends;
- Be quick to accept and quick to discontinue new products;
- Understand that happy staff lead to good shopper engagement;
- Use permission-based e-mail to contact shoppers;
- Develop premium, exclusive brands. It's often a mistake to think that Private Label has to be a low-price alternative;
- Transform frequent shopper programmes into full loyalty programmes.
Hale concluded that retailers that incorporate these basic survival tips into their overall strategy will see immediate results, and that frequent shopping trips and customer loyalty are signs of success that retailers can count on: "Many consumers are not only brand-loyal but also store-loyal. If they feel a store goes out of its way to make their shopping experience more pleasant and less stressful, they show their appreciation with more frequent shopping trips and bigger sales totals."