Year of spoiled shopper, warns FGRT report
More than ever before, spoiled shoppers want more, want it their way and want it now, says a new report from think tank FGRT (formerly Fung Global Retail & Technology).
This trend will further splinter consumer spending and favour retailers with strong identities, as well as nontraditional channels and non-retail categories, says the report, 18 Retail Trends for ’18.
“Specialist retailers offering ever-more choice will continue to peel dollars away from mid-market behemoths,” writes FGRT MD Deborah Weinswig.
Sponsored by Celect, a cloud-based predictive analytics platform that helps optimise inventory for retailers, the report details five key consumer and retailer demands that will drive change this year…
- I want to shop on my terms: Consumers will switch more of their spending from conventional retail to new and alternative formats and channels, as retailers scramble to offer new choices and reshape their physical estates.
- Make my life better: Shoppers will value life-improving services from retailers and technology firms.
- Give me a better experience: Brands, retailers and technology firms will offer new types of interactions, rewards and experiences.
- Let’s collaborate: Rapid industry change will prompt retailers to collaborate with technology giants (including Amazon), logistics technology vendors and social-media influencers.
- Make it faster: Retailers will use technologies as diverse as the blockchain and 3D printing to make their supply chains smarter, and as a result more fit for a more competitive market.
Consumers will demand to shop on their own terms by using new and alternative formats, and to be provided with life-improving services as well as new experiences and rewards from retailers, brands and tech firms. Meanwhile, retailers will seek to collaborate with companies spanning services providers to tech giants, and to speed up their supply chains.
Brick-and-mortar retailers will increasingly collaborate with brands, services and other retailers in order to gain benefit from their physical networks.
Retailers also will collaborate with social-media influencers and with companies that enable cross-border e-commerce.
Technology will continue to remake the shopping experience, and adopting tech early is one way traditional, large-store retailers can fight back against more specialised upstarts, says Weinswig.
In particular, artificial intelligence (AI) will help retailers offer individual consumers tailored interactions, including shopping recommendations, and personalised mobile-commerce portals and promotions.
Another notable trend will be consumers shifting their grocery shopping to unstaffed, high-tech convenience stores, which are already spreading in China. The report says it expects droves of consumers elsewhere in the world to start buying groceries from such stores.
These innovations will cultivate an ecosystem of technologies as retailers seek to partner with tech firms. The ecosystem will include major payment apps to automate the checkout process, using innovations such as facial recognition for payment and AI for inventory management, plus emerging self-checkout offerings that enable shoppers to scan and go rather than wait in line.
Meanwhile, blockchain technology will provide a springboard for more FMCG and grocery brands to bypass retailers and sell directly to consumers.
FGRT expects the online luxury market to grow as well, given the recent launches of luxury sites from Alibaba and LVMH. New and expanding luxury platforms are expected to continue to steal sales from high-end department stores.
More retailers will integrate their online and offline propositions with cross-channel formats and services this year, says the report. This will include Alibaba Group moving into department stores and opening hundreds of grocery stores.
Instore, multisensory experiences will become mainstream as part of immersive brand storytelling, says the report. These experiences will variously incorporate VR, sound, taste, scents and temperature.
Meanwhile, mobile will become increasingly central to shoppers’ engagement with retailers at all points, from browsing to paying to customer service. Retailers must be ready with mobile-first loyalty programs, payment methods and personalised homepages, says the report.
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