We often talk of all of the change happening in retail… but is the retail industry actually changing? Or are we just getting over excited? Is this just a natural evolution and we’re blowing things out of proportion? In fact, this essential question is critical to dive into for the Retail Transformation Show. What retail changes are we seeing and should we be concerned? What actions should we take? Discover the answer to all these and more in this podcast episode.
In this episode, you’ll hear:
- Key reasons why retail isn’t changing
- And other key reasons why retail is changing
- The 1 statistic that terrifies Oliver Banks
- What should you do about it?
Is retail change just fake news?
There are many elements of retail which remain unchanged. Important elements such as “the customer is always right” are continually true. And, they continue to want a trustworthy retailer who can serve them again and again.
Other important elements also remain true.
The product is still important
Your product and range must get the quality and price equation right. Value has always been important to customers – and it remains important today.
Plus, availability is obviously critical. Afterall, if you don’t have something in stock, then you can’t sell it. And from a customer’s perspective, it’s a source of frustration, especially if they are specifically looking for a particular product or variant. But still, in retail, we sometimes we overlook this – or don’t give it the attention that it needs and deserves.
Stores and store teams are still critical to the retail industry
Retail remains a person to person business. That is – the retail industry demands human relationships to be truly successful. Therefore, the retail workforce remains critically important.
Whilst ecommerce seems to grab all of the headlines, it is the physical stores that still represent the lion’s share of the retail market. Depending on which source or reference material that you use, physical stores represent 80 to 90% of the market. They still hold a very important share of retail and that won’t be going anywhere anytime soon.
The essence of retail is an exchange of money for product
The classic retail model of “buy – move – sell” still holds true too. And ultimately, retail is still an exchange of money for products and services. Just as it always has been.
Competition has always been present in retail and the fittest businesses will survive. When customers have a choice, they’ll make sure they put their money where their mouth is!
So, in managing a retail operation, you’ll still need to understand the customer. You’ll still need to understand the trends and use your experience and instinct. Plus, it’s important to be able to take action and adjust and tweak things as you go for optimum performance.
So there is a strong argument that retail hasn’t changed.
Or is retail change is really here?
However, whilst there are many elements which are unchanged about retail, there are also huge things which have changed.
The customer is in control now
Whilst the customer is still right, they are also king or queen now. In the consumer led market that we now find ourselves in, the individual consumer has turned into a demanding force with a voice that can be heard around the world. They want visibility and transparency. They want a reason to shop with you. Furthermore – they want you to be actively supporting charities and causes – other than just taking money through the till.
Global supply chains have changed product choice and alternatives
Products and services can be procured from all around the world. Marketplaces have flooded retail with low cost alternatives. Sometimes, low quality too, choice can be a confusing matter for customers now. However, technology means customers have great visibility of the marketplace right from their fingertips. They have access to more knowledge than store staff sometimes – and are still thirsty for more.
The workforce is changing
With the advent of new technologies and new propositions, the total skill set required by the organisation has grown dramatically. In fact, new capabilities are needed which just didn’t exist a few years ago.
With the population and lifestyle changes in the wider world, we’re also seeing people move into the gig economy and take up portfolio careers. They’re choosing what suits them and their lifestyle. The age of 1 job for 1 person is declining. But people also want to be part of something bigger too. So, being clear on the purpose of your whole retail business is essential.
You must be ever present across multiple channels
With this consumer led market that we’re now in, we must be ready for the customer when and where they want. Customers expect more from you than just your physical stores. They’re wanting to see you on social media. They’re wanting to see you on your website. The customer is choosing how they want to shop and engage with you. And if you’re not ready for it then there are plenty of other businesses waiting in the wings – ready to swoop in and woo your customer away.
Convenience continues to grow as a trend. Not just about nearby stores or fast delivery – this is about making life easy and quick for customers. We’re more determined than ever before to wage a war on friction in the customer shopping trip.
There are a plethora of new systems and technologies that allow you to engage and interact across these channels. Plus even more to help you do so profitably. The essence of these systems is the same – but what they do (and what they can do) is significantly different from what we’re used to as an industry.
New models and new data changes everything
Whilst retail remains an exchange of money for goods and services, the details of this transaction are shifting. Subscriptions and rentals are changing how customers pay and interact with retailers. Whilst these models have always existed, we’re now seeing them in product categories that have never seen them – and with a scale that we’re not used to.
Partnerships, franchises and collaborations are also on the rise. Retailers must start to think about new ways of getting to market and consider who really represents a competitor and who could actually be an ally.
And with the exponential rise of data, it’s critical to learn how to use this resource. Many retailers seek data scientists right now which is a big indication that this is an essential new capability. In the dawning world of AI, intelligent decisions are a must to stay one step ahead of the market – or to avoid the inevitable downfall.
Retail is changing and you must transform
So, whilst there are many elements of retail which remain unchanged, there are many elements which have fundamentally changed retail. We’ve seen what happens to many retailers who do not change. Each of these cause me a little pain in fact because they could have transformed. They could have changed. So, if you are reading this, then there is probably still time to transform your operation and your retail business. I’m not saying it’s easy, but it is essential. After all, we’ve already seen how the alternative route ends.
Get help with your retail change and transformation
The journey of retail transformation is tough. There are many different directions to take your retail business and operation. But also, many opportunities to slip up along the way. That’s why, I’ve defined my Transformation Trifecta, to help guide you through the 3 critical elements to make your transformation a success. You’ll have the questions and points to look out for to help you find the challenges and even find out the next steps that you can take from there. Sign up below and you’ll also receive my weekly Retail Transformation Briefing to make sure that you’re continually up to speed with the world of retail transformation.
What do you think?
I’d love to hear from you to see what you think of this podcast episode of the Retail Transformation Show. Reach out to me on LinkedIn or Twitter (@ollie_banks). Or even drop me an email – email@example.com.
I’m looking forward to hearing from you!
If you enjoyed this, then check out these other episodes
Episode 42 and episode 43 with Polly Barnfield OBE, founder of Maybe*. Polly shares a load of golden nuggets about how social media is changing retail – and importantly, what you can do about it, especially if you run physical stores.
You might also like to listen to episode 23 and episode 24. Here, George MacDonald, Executive Editor of Retail Week, explores how retail is changing and hints at what could be in store next for the industry.