A Year of Retail: The Lessons Learned from 2018
A Year of Retail: The Lessons Learned from 2018
It’s no secret that 2018 was a difficult year for retail. Toys R Us led the demise, closing 735 stores worldwide, this negative trend continued with Maplin and Poundworld going into administration and Mothercare falling into Company Voluntary Arrangements. It was a potpourri of social-politics, financial failings and fear-mongering with Brexit.
Retail hasn’t been the only industry to suffer. Major leisure brands have taken setbacks, and even football attendance is down, with popular London clubs such as West Ham reporting a decline of as much as 22% over 2017/2018. Would-be customers are more cautious with money, and this nervousness is a domino-effect that can quickly turn into a tsunami, with retail among the first in its course.
It was not all doom and gloom, however. There were brands that not only weathered the storm but increased in sales during 2018. And this is where it gets interesting. What did they do right?
Enhanced Customer Experience
Christmas shopping is the annual reminder that the high-street isn’t dead, it’s just waiting for an experience. When you think of Christmas, you’ll think of presents and late-night-shopping. During this time, retail utilizes the senses, sights, smells, sound, everything excitement. It’s now January, so you might not think this is relevant. However, it is the perfect indicator of what customers want, retail to offer an experience.
Features like AI and Machine Learning are at the forefront of experiential retail. With brands utilizing AI from efficiency in manufacturing to customer-facing robots. Brands like Cortexica have developed image-recognition technology, which John Lewis recently integrated, allowing customers to upload images of clothing and find near identical items. AI is also tackling queue-times, with Amazon Go implementing a ‘Just Walk Out’ system – Futuremart stores in China have gone one step further with their Happy Go system, offering discounts based on how much the customer is smiling.
While AI and in-store tech serve the purpose of saving time and money, the potential greater merit is in creating an experience for the customer. By digitalising and using physical space in innovative ways, retailers can increase loyalty, interest and align with the modern-day tech-savvy customer.
It’s positive to see so many omnichannel retailers reporting growth. Mountain Warehouse, Smyth’s Toys and Lush are examples of brands that reported significant growth (including a growth in sales of 22% for Mountain Warehouse). Omnichannel has great strength in depth. Online to offline, customers require a seamless journey that is accessible across a variety of platforms. It’s the same reason Amazon are now creating physical stores; by expanding their sovereign to street shopping, they are utilising the data-collection potential and visibility of omnichannel retail.
By merging physical platforms with tech, retailers can give new life to brick & mortar and prove that despite the popularised saying, the high-street isn’t dead.
In today’s digital era, it’s important that retailers provide accessibility to their customers; through apps, high-street stores, in-store tech, click & collect, whatever it is, customers need the stimulus and visibility that only omnichannel retail can provide.
Last year proved how important differentiation is for the customer. Retailers who embraced tech and provided a ‘why’ instead of ‘what’ were more successful. In this way, 2019 offers an opportunity for retailers to get ahead while others still lag in a stubborn approach to change.
The main thing to take from 2018 is that you can never get sleepy in your strategy. The customer is constantly evolving, and this requires a constantly evolving way to engage them. Retail has been through many of these challenges before, and sometimes, it’s that kick that propels them forward to greater success.
If you’re interested in bringing experiential retail to your stores, Timico’s depth of IT provides the perfect infrastructure to build and maintain tech-driven retail. By digitalising your stores, Timico help create hubs that are ‘always open’ as well as the infrastructure for data capture, analytics and smart phone capabilities to keep you ahead of the game. Contact us to find out more.
Jan 23, 2019
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