Like most things in life, when looking at the future of retail, a good indicator of where we are going is to look at where we have been. Since 2010, the way people shop has drastically changed with social media and technology booms. Not only can we now shop wherever and whenever we want, but everyone is now a critic, and we can get a wide range of reviews about products from multiple perspectives.
That said, some think that retail will change more in the next 5 years than in the last 50. By 2020, members of Generation X will be hitting peak earnings and Millennials will be shopping for their children. The next generation will define the norm of shopping behaviors. This new outlook will impact retail in the following ways:
- Consciousness: It has been reported that younger generations care a great deal about citizenship and want to support brands that are aware of the impact they have on the world. Whether or not a company is doing good and supporting the community will have a direct impact on where people shop.
Kit and Ace, the men’s & women’s luxury fashion company from Vancouver, hosts monthly supper clubs in each store where guests enjoy food and drink from local vendors and share ideas. Also, all store furniture is locally sourced or custom made. This, and the innovative fabrics they use, such as Technical Cashmere™, allows Kit and Ace to charge premium pricing for their clothing.
- Customization: Younger generations are used to having their specific needs tailored to as opposed to fitting in someone else’s box. If they can personalize all their social media, why do they have to compromise with anything else? Diversity and variety will be an important factor for a successful business, but the balance with inventory may be difficult to strike. Innovative retail technologies, such as endless aisle, will help retailers cope with the mass customization
Piol, a New York-based startup, offers bespoke, made-in-New York dresses in 5 styles with over 56,000 combinations. When designing a dress on Piol, the client is asked to share her hair, eye and skin color and is then presented with fabric options based on that information. Piol offers a full refund if the dress isn’t exactly right.
- Care: In the end, retail is about how the customer feels and with the ease of online shopping, customers are more likely to have less patience in a brick and mortar setting. Efficiency and positive customer service will be important so people have a good reason to leave the house. We can expect more emphasis on customer experience and less on products. The advances in retail technology allow store employees to focus on interacting with clients rather than on executing sales.
Shoe stores can now feature size check scanners for instant confirmation of size availability. Instead of running back and forth between the floor and storage room, sales reps can take time to provide meaningful suggestions and help shoppers find that perfect pair of shoes. Once a pair of shoes is selected, there is no need to visit the counter – thanks to handheld point of sales terminal and tap-to-pay smartphone solutions.
These are just a few things that will impact the retail industry over the next 5 years, but there are always more popping up. Another important ‘C’ for retailers is ‘Continuous Learning and Innovation’ in order to keep up with all the coming changes in shopping trends and technology.