Retail Observer

RETAILOBSERVER.COM OCTOBER 2016 60 MARKETING TRENDS IN THE EVER-CHANGING WORLD OF RETAIL I n the ever-evolving world of retail sales, using marketing trends to determine the future of the industry can be extremely difficult to quantify. The overwhelming popularity of e-commerce has essentially turned retail on its head and continues to do so to this day. The change that it has brought to shopping, particularly within brick and mortar stores, is nothing short of revolutionary. Every year, industry analysts attempt to make predictions on the which direction retail may go in an effort to shine light on a new reality: industry stalwarts such as Sears and J.C. Penney cling to survival as the American shopping mall rapidly becomes a relic of a bygone era. Identifying the retail trends that will prove prescient is not unlike throwing darts at a board. However, certain trends do appear to have more certainty than others. The continued popularity of internet sales as opposed to in-store sales, the offering of additional payment options for retail sales, the rising popularity of subscription shopping, and the increased targeting of millennial shoppers through non-traditional strategies all seem like good bets for the future of retail. Although it seems more like a retail fact of life more than a trend, it would appear the overwhelming popularity of e-commerce sales will continue unabated to the detriment of in-store sales. According to Walter Loeb's "Why Retailers Must Restructure in 2016" in Forbes magazine, online sales rose 23% in 2015. Loeb writes that the world of retail was not ready for this epic shift in buying habits that has now come to pass. "I believe that many retailers did not anticipate the change in buying patterns and the negative momentum it would bring to their stores. They did not see the rapid shift to online shopping, which often occurs in the middle of the night when customers have ample leisure time." The near universal reliance on smart phones and tablets has also played a large part in this industry phenomenon. With e-commerce rapidly becoming the preferred method of purchase by shoppers, Loeb asserts that traditional brick and mortar retailers will be forced to alter their business structure through staff layoffs and store closures to offset losses in revenue. In order to keep up with the juggernaut of online sales, it is also forecast that retail stores will begin to offer a wider selection of payment options to accommodate customers. With a large segment of the population no longer paying with cash, retailers have no choice but to make alternatives such as Paypal, Apple Pay, Android Pay and Samsung Pay available to the everyday consumer. Subscription shopping such as Dollar Shave Club, Netflix, and Spotify is another hot marketing trend that has potential for continued growth in the years to come. According to Kay Fay's "Online Retailers Think Inside the Subscription Box" in Internet Retailer, "Subscription- based e-retailing is one of the fastest growing online segments, and more traditional merchants like Starbucks and Sephora are adding the box model to their repertoire." The retail industry's efforts to transform millennials into predictable consumers are another recent marketing trend that is likely to continue. Millennials have distinguished themselves from buyers of past generations by the amount of time they spend online researching an item before they actually buy something. Loeb writes of the buying habits of millennials stating, "Millennials respond to good service and do research on the Internet before making a major purchase. They are "real-time" consumers, shopping for today's needs and waiting until the last minute to shop for tomorrow's events." The days of impulse buying appear to be over for this generation. In order to secure them as dependable customers, millennials count on information that will validate their purchase. The marketing trends described are hardly certain in a retail landscape that seems to change daily. The staid, predictable consumer tendencies of the past have now been demolished and replaced with a fluid, ever-changing marketplace where e-commerce, payment by smart phone, subscription shopping, and the consultation of online reviews before purchase are the new reality. Ready or not, the brick and mortar retail stores must adapt to this new environment or risk becoming a dinosaur mired in the methods of the past. John White Appliance Trends John White, EVP of major appliances at BrandSource RO

• Cover