The Changing World of Retail
Apr 07, 2010
by JIM KRESS of Central Oregon Community College
Las Vegas recently hosted the retail conference Global Shop. Although Global Shop does have an international perspective, the many seminars (25) focused on retail trends nationally as much as at the global level. These trends are for both the large chain and the independent retailer. It is a great show for the latest in store design and merchandising, consumer behavior, along with the expansion of digital media and social networking as part of the promotion mix. As far as trade shows go, it is relatively inexpensive. Held each March, it is a worthwhile conference for any retailer to attend. For further information go to globalshop.org. Here are some takeaways from another great show:
Wendy Lieberman, CEO of WSL Strategic Retail, is one of the big guns in monitoring retailing trends and consumer behavior. Her latest research reinforced one of the key themes at the show this year. Demographics is not as important a segmentation strategy as it used to be. The fact is the downturn in the economy has new shoppers going to some of the mass merchandisers and realizing they had a good experience. They tried it, and they liked it. This trend will continue as 53 percent of the consumers surveyed feel the recession will continue for 1 to 2 years and 36 percent think it will continue for at least 3 to 5 years. The consumers’ emotions include fear of debt, fear of overspending, and fear of what is around the corner. These fears are shaping their behavior.
Everyone at all income levels seems to be searching for bargains and value.
Retailers need to respond to this change in behavior by reinventing their store experience and telling their story. While the pressure from the mass merchandisers exists, the small independents still have the service edge. They know their individual customers better and can respond in a more personal way. Make your store a more personal experience, one that creates emotional comfort for the customer. This was another one of the key themes from the show. The trend is to tell your story, to restate the worth of your company’s brand. This was done with two common ideas heard regularly in presentations: “vintage” and “heritage.”
The one growing channel of retail is the internet. Its use is up 13 percent over the past year, whereas every other section of retail has moved down. Mass merchandisers and independents are down 3 to 9 percent. Increased use by women has made this the tool as part of the search (and purchase) process. Consumers are searching for information, greater selection, an increase use of reviews on both products and stores. They also seem to be looking for coupons and better deals. The small retailers needs to work with their manufacturers whenever possible to help create a vibrant Web page that speaks to the customer on a personal level while giving them the product information and reviews they search for.
What happens in Vegas stays on You Tube and Twitter! Such is the expansion of social networking across the retail landscape. The most common question was “how do you find the time?” Most companies are taking resources from their typical media choices (print and broadcast) and expanding into social media. However it isn’t the main promotional tool, it is only one of the promotional tools. Everyone seemed to agree that for the small retailer, the best way to decide if you should use social media is to talk with your customers and determine if they would use it if it were to become available. There was also a strong trend to responding to mobile devices as customers use those tools to search for information about products, promotions and store locations.
Jim Kress teaches retailing and marketing at Central Oregon Community College. This spring term his students will be evaluating local web pages for independent retail businesses. If you would like a free evaluation of your web page, contact him for an appointment. He can be reached at 541-383-7712 or