Retail trends from around the world

With global uncertainty on the political, financial and retail fronts, several new trends are emerging that will have a significant impact on Australian retail. There are five global retail trends in particular that all retailers must be aware of!

The challenge then is how retailers steer through this sea of uncertainty whilst charting new courses for the shifting tides, to ensure that they’re well positioned to emerge as the economy strengthens. The retailers that will re-emerge in a stronger position will be those who have held true to their positioning and demonstrated a commitment to continued innovation of thinking, investing in emerging trends and ensuring that they are fit for business.

Never is this more of a truism than in the centre of global retail, Europe and the U.K. My recent tour of European and British retail, including meeting with the international retail experts alliance group, Ebeltoft, only served to emphasise my view that the following key trends will have a major influence on Australian retail.

1. TECHNOLOGY

TREND: Make absolute use of technology in retailing to heighten shopper experience and connect your customers. Getting your product to your targeted and connected customer, through your unique proposition, seamlessly delivered with technology driven metrics is the key.

Connection through technology is a worldwide social phenomenon and switched on retailers are featuring prominently on social media sites.

Social tailing is important: Facebook and LinkedIn are all driving consumer choice and influencing consumer preferences, with links into online social cocooning and the ability to influence consumer taste, for instance how Susan Boyle reached millions virtually overnight. Consumers want connection (on their terms), security and paradoxically some excitement. Interestingly the trends of internet usage are overtaking the use of the traditional communication medium that we know as television.

A powerful example of retail shifting the boundaries and the use of technology via social media is Threadless. They’ve engaged an online community to develop their product and be engaged in all operational steps to launch. They launched a new t-shirt concept online, where the public were invited to give their opinions of the t-shirt designs via a member voting system. The most popular designs then progressed through to the next stage where they were assessed on their saleability and production quantities. Then at each later stage players were rewarded, initially by money from sales and secondly by having their name enter the annals of Threadless. This merging of on-line retailing and off-line sales has created a new mode of in-line retailing with a store in Chicago, bringing people and ideas together through social technology.

2. GREENTAILING

TREND: Being seen to be green is the buzz cry of today’s retailer. But being green to be seen is much more than this for an enlightened retailer and their increasingly savvy consumer.

A report titled Environmentally Friendly Retailing says while 2007 saw high-level sustainability commitments from the retail sector, 2008 was more about the delivery of more efficient operations and stores, better supply chains and changes to product ranges. The report also documents the plethora of green announcements by retailers around the world in recent months, with IKEA, Wal-Mart and Tesco among those demonstrating the most serious commitments by focusing their business around green goals as they work to maintain green credibility. 

Consider retailers such as Wal-Mart, Tesco openly promoting green as an element of the new order retailer both for energy consumption supporting the corporate citizen and as a key strategic differentiator.

3. LIQUID RETAILING

TREND: Another key trend is Liquid Retailing, which reflects the evolution of retail format to meet a growing consumer demand for flexibility and technology in their shopping experience.

Department stores are changing; it’s less about department and more about co-ordinated lifestyle, that is, showcasing food, a living/dining room and all it encompasses.

In addition, pop ups are emerging which provide quick entrance and exit for retailers trialing new concepts or exploiting seasonal lines. Liquid Retailing asks the following question, is the traditional shop really just a passing fad as retailing can occur regardless of space and with rapidly changing context? In store WIFI systems for scanning product via the mobile phone is a technology enhancement that embodies the liquid retailing philosophy through creativity, immediacy and innovation.

A supermarket that takes your order online while you pick up offline is a good example of a trend leading liquid retailer.

4. TRUST

TREND: The current uncertain climate has manifested itself socially into retail through the need for trust. More than ever before, consumers want—and need—to trust their retailer; and to trust what a retailer delivers. This translates into pressure on retailers to step up and improve customer service, improve knowledge of their customers and improve fitness for business across all touch points.

Trust as a concept has existed in retail for years, however the need for it to be more transparent is growing at a rapid pace, and arguably is linked to increasing array of choice and need for trusted brands. Earning a customer’s confidence and maintaining this trust transcends all retail touch points from social issues through to in-store delivery and follow up.

An example of the changing retail landscape is French giant Geologic Village, a wholly innovative concepts that incorporates a store and a vast green playground that allows customers to try out the equipment and follow technicians as they test new products. They can go fishing with designers and provide feedback on the prototypes and even suggest new types of fishing rods. This thinktank of ideas develops greater trust in the brand, and flows quality feedback and ideas through to the designers to improve their product delivery.

5. GLOCALISM

TREND: Glocalism is a fascinating new trend. It’s seeing the merging of the traditional values and structure of the past with modern thinking and infrastructure.

Desigual in Barcelona is a store with a uniquely creative style and innovative collections constructed to look like an outdoor market through its display. Similarly Bols, a Dutch distiller, established in the 16^th century, has launched a new concept that dovetails past and present by means of historical references. Imagine Rembrandt and original cash registers, set amongst a high tech environment that offers customer a multi sensory interactive experience with the brands famous cocktail.

What does all this mean for Australian retail?

During the good times retail businesses can achieve growth with lazy practices, but today it’s imperative they cut the fat productively in all aspects of the business: excessive merchandise, untargeted communication, poor people management and operational costs. With up to 75 percent of customers not purchasing after entering a retail store, the focus needs to be on best practice and converting current customers.

With the global uncertainty it’s vital for retailers to understand their positioning, their point of difference in the market and stay true to their brand. It’s not a time to be chopping and changing direction without a clear, concise plan and vision. It’s vital to address the present with a strategy and implementation disciplines yet it’s also key to look to the future and embrace the shifts in consumer needs and wants to ensure that emergence from the current climate positions you ahead of the pack.

Innovative new practices that think outside the square box of retail, where all customer touch points are excited, available 24/7, relevant to a segmented audience, motivated and inspired, is the catch cry of the new global practices in retail.

– Brian Walker is managing director of the Retail Doctor Group:www.retaildoctor.com.au. European insights from the Ebeltoft Group www.ebeltoft.com