The end of the retail industry is completely premature. Consequently, there is no data that supports the “retail apocalypse”, the retail industry is simply experiencing an evolution. The phrase “retail apocalypse” suggests that the whole industry is collapsing but it’s hard to support that idea when the data says otherwise. Last year itself, total retail sales, including food services and motor vehicles and parts, grew 4.2%, adding $231.5 billion to the American economy. Although digital transformation is becoming the biggest complication in the retail industry, there are three main reasons to understand this effect: Let’s begin.
First, retailers face a tough slew of questions that must be answered even as the world becomes ever connected through the Internet of Things (IoT) and, of course, through mobile commerce. The brick-and-mortar model needs an update, stat. Retail was an early adopter of data analytics, and brands often ask customers about preferences, many times using back-end data to learn more about interests and behaviors. Collect, analyze and apply insights gleaned. But that model is too slow for today’s consumer.
Secondly, at the core of retail is customer service. Consumers carry around more technology in their pockets than most retail stores had to ring sales not that long ago – and those devices get more powerful every year. Consumers are constantly seeking convenience and if certain retail stores don’t evolve along with consumer expectations, then it will lead to a decline in sales. The retailers that have largely failed are those that haven’t implemented an omnichannel (is a multichannel approach to sales that seeks to provide the customer with a seamless shopping experience whether the customer is shopping online from a desktop or mobile device, by telephone or in a brick and mortar store.)
Lastly, rising consumer expectations have far outstripped retailers’ ability to keep up. Many consumers expect the brand to engage with them on social media. Retailers want their tech-enabled experiences to be “perfect” as soon as they hit the market. Retailers find it difficult to be vulnerable with consumers as they are trying to keep up with how fast consumers receive a perfect customer experience. If there are any inconveniences or bad experiences, customers can easily contact the retailer through their social media accounts. Certain retailers are actually thriving at the high and low ends of the retail spectrum. Many discretionary funds are either shrinking or growing which ties in with the growth of those retailers at the tail ends of the premium and low-priced stores.
In conclusion, retailers have more change, knowledge, and tools to implement throughout the evolution of consumers. Many consumers care about the companies purpose which helps a business thrive. Moreover, shoppers with both premium and priced-based retailers are more likely to recommend these businesses than those shopping in the mid-priced businesses, perhaps indicating that these retailers are better aligned with changing consumer needs and preferences.