By Nancy S. Mautner
The overwhelming theme at the National Retail Federation’s 2011 Convention (New York City, January 9-12) was that the consumer is more in control than ever before, often moving faster than the retail industry itself. Consumers are demanding, tech-savvy, less brand-connected, and have no patience for inefficient retailers. In order to prosper, retailers have to become customer-centric, communicating with customers both online and in the stores. If you don’t have what the customer wants, when they want it, you will lose their loyalty and lose their business. The event, which is always busy, was jam packed this year as retailers scrambled to try and find that silver bullet that would boost sales, as well as cram on the latest tech innovations. Nearly 2100 attendees and 500 exhibitors representing 70 countries gathered for the event, an impressive increase from the 18,500 who attended last year.
Going Global: One of the biggest issues for retailers is globalization, according to the 2011 Global Powers of Retailing report, unveiled at the convention. Among the findings in the report was a focus on the Asia/Pacific region, which topped regional global sales with US$4.6 trillion, a 35% share of global GDP. Africa and the Middle East have the highest percentage of retail growth, followed by Asia/Pacific and Europe. Those in attendance were also told to expect slower growth in the United States over the next decade, but increased business in China, Vietnam, Indonesia, Turkey, Egypt, South Africa and Colombia, due to a rapid rise in the middle class. Keeping your business dynamic requires keeping an eye on emerging markets.
Marketing To The Mobile Shopper: The latest research from the National Retail Federation (NRF) showed that over one-quarter of shoppers used their mobile device to make holiday purchases in 2010, but more than 60 percent used their device to browse for gifts. The big question facing retailers today is how to bridge the sales gap that results from consumers not feeling confident enough in the security of m-commerce or finding that tiny smartphone keyboard awkward to use. David Dorf, who heads the NRF’s Customer Subcommittee said he expects that, in the near future, smartphones will contain NFC chips, able to store loyalty data, coupons, and payment information. At least one report has Apple already testing a prototype iPhone with near-field communication (NFC) chips inside, which could pave the way for using future iPhones as a mobile wallet. Looking ahead, according to Nielsen, by the end of 2011, 50 percent of the U.S. population will have smarrtphones, a phenomenon that has clearly and dramatically changed the way people shop.
Cutting Costs Or Just Good Public Relations: The green movement is here to stay. Over the next decade, expect to see an increasing number of retailers making dramatic moves toward going green. One area coming under increased scrutiny is packaging. With smartphones that are able to scan barcodes, there soon may no longer be a need to have the same information printed on labels or packaging. That would be a huge step in an ongoing effort by many to remove the cost of paper and cardboard from the supply chain. Some retailers have already started putting items in glass bulk containers rather than in individual boxes and bags.
You’ve Got Mail: Those pesky promotional emails that seem to land in your inbox on a daily basis are losing their relevance. Email lists are not performing as well as they used to because retailers are getting lazy and overconfident. They’re sending them to the wrong people at the wrong time, and the content leaves a lot to be desired. The experts still insist these promotional email blasts, if executed well, are one of the greatest drivers of traffic to a brand’s website.
Selling In China: Who is the Chinese consumer and what do you need to know before trying to expand into China? There’s no simple answer. When it comes to the younger generation of Chinese consumers, brands and retailers should strive for authenticity. Just being Western isn’t good enough anymore. In fact, the youth in China want local brands. Whether it is an authentic Chinese brand or a Western brand tailored exclusively for the Chinese market, the days of the “copy culture” are gone. In addition, items have to be tailored even further because what’s appropriate for Beijing may not work in Guangzhou.
Winning On The Web: What we’ve seen so far is just the tip of the iceberg when it comes to the web’s potential impact on retail. Thanks to the web, it has become a borderless world for shoppers and retailers, and reaching global markets is today’s reality. Retailers have to focus on making sure that consumers have a consistent experience with a brand across all platforms. It is expected that in the next two years, over half of U.S. retail sales will be influenced or impacted by the web. According to Nike, we’ve gone from “bricks and mortar” to “bricks and mobile.”