5 Years Ahead
Recently we polled how our newsletter subscribers’ view e-commerce, and the responses were surprisingly negative. With over 60% of Australian consumers purchasing online at least twice a year, and more all the time, bricks & mortar are feeling threatened.
The fact is retail is changing. Fast. The majority of consumers are budget conscious, technology savvy and globally minded.
You, Retail manager, need to know this, and work with the consumer. Because in five years the retail landscape may look very different from the one you have been used to.
Cash is already a rarity, but within 5 years banks will prefer you not to use cash. In fact, a report by Javelin Strategy & Research estimates that by 2017, only 23% of point-of-sale transactions will involve cash – less than a quarter. While this will definitely reduce register robbery in retail, cybercrime will probably increase.
What you need to do to prepare: Set up a credit card terminal, even if you are a market stall. Many people carry no cash these days anyway and this will only increase.
Accept as many cards as you can. Yes, some of the credit card companies charge exorbitant fees at the moment – but we’re predicting that this fact may change, so keep an eye on fees and rates, and make your terminal as universal as possible. Get a PayPal account, or similar. PayPal is not perfect and may not be an option for you; however you need something equivalent for ease of online transacting.
Every Brick & Mortar will have an online store. Showrooming, currently the enemy of the traditional retailer, will become part of the shopping experience whether the retailer likes it or not. More and more people will follow a buying pattern something like this:
The Customer of the Future Purchasing Method
So if you don’t pop up in their line of sight when they are researching or buying online, you are going to miss out.
What you need to do to prepare: Understand the products you sell, and the way your customers buy. Consumers of the future will only become more information-hungry, so you need to have that information for them.
Get a website. Even if you know nothing about technology, and can’t possibly operate it yourself, you need one. Subcontract the task out; get your nephew to set it up if you like…. the sooner it’s there, the sooner you will be found online.
Big Box Shops will be less common in the real world. Those shops that sell everything, those ones that are the small retailer’s worst enemy? Good news; they will probably become a thing of the past. Look to the US (Australian retail generally tags along behind) to see the mighty falling: Borders, the massive bookstore, closed its 625 stores in 2011, and Circuit City, an electronics superstore with 567 locations, shut its doors in 2009. 24/7 Wall St, an investment analyst company, predicts many similarly large companies will follow over the next few years, being replaced by specialist retailers, expert in one area – places where you ask the sales assistant for advice and they can give you accurate advice, not a blank stare.
What you need to do to prepare: As a small retailer you are already in a good position as a field expert, however, these big box places are still succeeding and growing online. So that’s where you need to be as well.
Internet will be everywhere. Well it sort of is now, with mobile phones, tablets, laptops and desktop computers, however data analyst Cisco.com predicts that by 2017 92% of Australians will be connected to the internet (currently there’s about 75% connected). And between the 23 million internet users they predict there will be 145 million internet-connected devices! That’s an average of 6.3 devices per user.
What you need to do to prepare: Most importantly, you need to adopt the mindset of transparency. It won’t be difficult for your customers to do a quick Google of your company, your product background, your service standards and more. So any skeletons in your company closet need to be cleared out now, so they don’t damage your bottom line then.