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Charting a Course in the New Retail Reality
Retailers face a host of challenges in navigating what has become a complex new retail reality. As our new whitepaper relates, a number of powerful currents are causing the retail industry to undergo a major seachange, including the continuing advancement of e-commerce, the erosion of the traditional department store model, and the rise of new modes of experiential retail, with technology playing a major role.
While traditional retailers like Sears, Macy’s, Kohl’s, J.C. Penny, and many more are on a downward spiral, a new breed of experiential retailers are thriving. Innovative brands like Sephora, Ulta Beauty, Bonobos, Rebecca Minkoff, REI, and Apple are pioneering new modes of retail that deliver richer and more personalized experiences.
At a time when e-commerce, new technologies, and shifting consumer patterns are undermining the traditional retail industry, the new breed of technologies and experiential formats are offering retailers the opportunity to reinvent and modernize their businesses.
All in on E-Commerce
When the CEO of Walmart announces that e-commerce is the company’s main focus going forward, you know the times are changing. And lo and behold, Walmart just announced that it is closing 63 Sam’s Club stores, converting 12 of them into e-commerce fulfillment centers.
This comes at a time when Sears has announced the closing of 103 more Sears and Kmart stores, as the company suffered its 24th straight quarter of sales declines. Sears is hardly alone, as major retailers closed more than 5,000 stores in 2017, with another 1,000 closings already announced for 2018.
In the new retail reality, large sprawling megastores, in general, are being replaced by smaller dedicated shops, including geographically located branches, depots, and specialty businesses like custom printing shops.
Experiential retailers are pioneering more creative and compelling modes of selling. One of the most popular forms of experiential retail is the pop-up shop, an experiential retail format that sprung up and become a $10 billion industry seemingly overnight.
E-commerce has given consumers a taste for easy and reliable product selection and delivery. Retailers like Amazon, Walmart, Rebecca Minkoff, and Apple continue to push the envelope for friction-free shopping, making checkout a breeze and delivering orders within days, hours, and even directly into the home.
Customer Experience Is Key
“Experience” is the keyword and cornerstone in today’s retail world. Online innovators like Amazon, eBay, AirBnB, Experian, Skype, and E-Trade disrupted entire industries through compelling user experiences, and the experiential retail models of today are taking the online and offline customer experience to the next level.
“Omnichannel” is another key retail requirement, with retailers today required to have compelling and coordinated presences across websites, mobile devices, social media services, physical stores, and customer service centers.
In the new retail reality, retailers must coordinate their online and offline experiences to accommodate customers’ needs. Retailers like Starbucks and Apple are delivering compelling retail experiences through exceptional in-store service coupled with mobile commerce. Established brands like Burberry, North Face, and Audi are adding pizzazz to their stores and showrooms through video screens, virtual reality experiences, and holographic displays.
Retailers today are challenged to master and deploy a slew of new technologies that are emerging, including mobile chatbots, geolocation, augmented reality (AR), virtual reality (VR), machine learning, live streaming video, Internet of Things, personalization engines, dynamic pricing apps, blockchain, pods, buttons, and voice shopping devices are cropping up at a rapid pace.
Modern market research tools like online branded communities are enabling richer, more precise, and real-time intelligence gathering, while advanced analytics in the form of AI and machine learning are enabling retailers to operate on Big Data, including real-time streams, to discover the most optimal directions and deliver more personalized experiences at scale.
SUMO Heavy has published a new whitepaper providing a comprehensive overview and analysis of the new retail reality.
It can be used as a guide to understanding the modern retail landscape and to help you plot a course in these turbulent but exciting times.
Click here to download your copy of the whitepaper.
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