Retail Brands in the Jet-age of Modern Marketing

In recent times, rapid advancements in technology have led to a significant change in consumer behaviour. Because of that, brands wishing to engage these consumers have had to adapt their approach and campaigns in order to remain relevant.

One industry that has been most affected by this change is the retail industry. Today, shoppers rely on their mobile devices to carry out in-store research before they buy any item. Millennials (people between 18 – 34 years old) especially, who have a yearly retail purchasing power expected to reach $1.4 trillion by the year 2020, have essentially disrupted the shopping practice. This disruption has found its way up to older generations. In a recent survey conducted by Accenture, 41% of all retailers admitted to “showrooming”– the practice of researching items in-store and going to buy them online eventually- in order to get the best price.

Now retailers have to deal with the following challenges:

• How to get a proper understanding across the diverse channels of their fragmented customer base.
• How to engage the different customer groups, given the large number of competitors grappling for their attention.
• How to adjust legacy business functions to compete with modern start-ups that have been designed to meet these new customer behaviours.

If it sounds scary, that’s because it actually is. Retail managers should be knowledgeable about the ability of their brands to perform in this jet age. Yeah?

Well, as it happens, the situation of things from the management level is more stable than you can imagine. In fact, a manager at Slatwell Accessories has stated that they are quite optimistic about this new direction of consumer behaviour. According to a recent study by The Economist Intelligence Unit, where 300 managers in the retail industry were interviewed, 79% described themselves as “very” or “extremely prepared” to compete in offering services with value for money.

Also, 76% of interviewed managers showed similar levels of confidence in their preparedness to compete in “product quality”, “great service” and the competence to “function efficiently”. So what are the retail managers not so confident about? In the same study, while a significant number reported high confidence in their ability to compete with technologically-adept individuals, 42% answered with being “quite prepared to compete.”

It is interesting to note that there is a dissimilarity in tone and the priorities of brands that were considered “top-performers,” defined by the following; same store sales, margins and inventory turns.

Top-performing retailers also ranked these development strategies as high:

1. Globalization: The growing competition being determined by global brands and the prospect of their brands expanding into fresh foreign markets.
2. Strategic Partnerships: Clever retailers are discovering new ways to enhance the customer experience through business partnerships, for instance, digital companies and stores working together to provide a user-friendly store experience.
3. Innovative store formats: Incorporating digital media into the retail-store shopping environment and transforming it into a destination experience, is a main concern for top-performing retailers.

Top-performers also had varied perceptions on the importance of different retail trends. For instance, 69% of top-performers who perceive globalization as a significant trend also see it as an opportunity, while just 43% of mediocre performers see it as an opportunity. Globalization too, is a top development strategy, quoted by 43% of top performers and only 33% of mediocre performers.

Competitive marketplaces that can concurrently be partners and rivals to retailers were also perceived differently by each segment. While 52% of top-performers saw the significance of marketplaces as their growth in opportunity, only 35% of mediocre performers thought so too.

Finally, while it looks as if the success in the future of retail is no different from that of its past, the tools and applications have just become more complex. Humans no doubt like to stick to a particular way of doing things, but when presented with simpler, faster alternatives, they will certainly shift to the latter.