‘Change’ is commonly associated with the retail industry.
- You get changed in a change room;
- If you change your mind about something you bought, you can exchange it;
- When you pay for something, you usually get some change; and
- Charles Dickens famously used the word ‘Change to refer to the Royal Exchange, where merchants met to do business.
A lot has changed in the retail industry over the years, and there’s a lot more change coming, driven by consumers’ demand for instant gratification, which, in turn, is fed by new technologies and digital disruption.
According to Shopify, global e-commerce was responsible for around $2.3 trillion in sales in 2017 and is expected to hit $4.5 trillion in 2021 – that’s an astounding 246% increase. Mobile purchases accounted for 59% of 2017 sales, or $1.4 trillion.
South Africans were expected to spend R45 billion online in 2018, with R14.9 billion of that spend happening on mobile. Local online spend is forecast to rise to R61.9 billion by 2020, representing a ripe market for local retailers.
Here are more opportunities that retailers can exploit, which show just how much retail will change in the coming years:
- Mobile first. If you don’t have a mobile app, you’re already falling behind. In the US, 71% of consumers have downloaded at least one shopping app. And, in South Africa, consumers were using double the number of shopping apps in 2018 than in 2017, and most have downloaded at least four retail apps.
Before you launch an app, though, be sure to test it extensively, because 21% of shoppers will delete it immediately if it doesn’t work well. With hundreds of thousands of apps to choose from, it can be difficult convincing consumers to download yours. Give them a good reason to, like a discount on their first purchase made through the app.
- Try before you buy. By the time a consumer buys something from you, you can assume that they’ve done some extensive research. You can now virtually view how a piece of furniture will look in your living room before buying it, and, if you like it, you can compare prices across thousands of stores before deciding who to give your money to. Technology has enabled entirely new shopping experiences, allowing us to try before we buy virtually anything. No pun intended.
- Personal touch. Technology enables retailers to engage with customers on entirely new levels. Now, with geolocation, mapping, and beacon technology, retailers will know when a customer walks through the door – or even when they’re close by. They can push special offers straight to the consumers’ phones, enticing them inside to take advantage of their personalised offer. The key here is personalisation. Consumers don’t want the same offers as everyone else. They want to feel special and that the retailer knows exactly what they like.
- Robotic retail. From chatbots to cobots, advances in machine learning and artificial intelligence let retailers better serve their customers by instantly answering queries and speeding up problem solving, like product exchange, handling returns, and letting customers know when there’s something new in store that they might love. According to the International Council of Shopping Centers, 37% of consumers used a digital assistant in 2017 to place orders and create shopping lists.
- Varied payment preferences. Consumers expect businesses to offer a number of payment options, other than card or cash on delivery. More and more South African retailers are even accepting payment in cryptocurrencies and are starting to offer mobile loans.
Clearly, the biggest change that we see in retail is a shift to personal, on-demand experiences. Like walking into a store and being handed the exact dress we’re looking for, in the right colour, and right size, with recommended accessories thrown in for good measure. We’d be in and out and on our way again in minutes. Wouldn’t that be nice, for a change?