Amid loads of reports that the high street is struggling in comparison to online shopping, we had a look at the retailers who are thriving in 2019 and how brick and mortar stores can take inspiration from them to up their game in the current climate.
So, what retailers are doing well and why?
Retailers at the high end of the market selling luxury items are doing great as well as those more affordable retailers on the high street. Brands in the middle of the spectrum seem to be struggling the most, especially those with physical stores.
Online-only store ASOS is having huge success. Maybe that is because they are listening to their customers’ needs and providing solutions. You can not only purchase goods from ASOS by visiting their website on your desktop or mobile, but you can also purchase via their App or social media, making the shopping process easier.
The high street only store Primark is smashing it without the need for an e-commerce website! They like to entice people into their stores with their clothing range that is unique and affordable. Over the past two years, Primark has opened 90+ additional stores in the UK, including the biggest Primark ever in Birmingham that has five floors. They are looking to improve the in-store customer experience by introducing a Disney themed cafe, a barber and a beauty salon.
Missguided is doing so well online, they decided to hit the high street. With new designs added monthly and 250 catwalk-inspired pieces added weekly, they are giving their audience a reason to stop by on a regular basis to keep up-to-date with the fast-moving fashion industry. As well as adding new lines, they are heavily focused on the value of their products.
The impact of technology on Retail
Technology has had such an influence it has made everything go online. Whether that’s your weekly food shop, buying clothes or even online dating. The expectations from customers are that they can find exactly what they are looking for quickly and also be able to have them delivered as soon as possible. Because of this ‘ASAP’ demand, we have seen an increase in retailers offering schemes, such as Amazon Prime, that cover next day delivery or in some cases, even same day delivery.
The shopping process has changed dramatically in the last decade going from only being able to shop during set opening hours to being able to shop any time you like and in any location you like. Retail going online has meant people can even shop internationally without having to leave their own home. All this has been made possible by the technology we have today.
Technology has also meant retailers can be more specific with their marketing efforts. Whilst you get more interaction from actual people shopping on the high street, the experience is nowhere near as personalised as it is online. Being able to check analytic tools to better understand their audience has meant better retargeting, and therefore an increase in sales, with a unique shopping experience for each customer.
Technology is slowly eliminating the need for physical labour by removing manned checkouts and replacing them with self-scan checkouts. This has been a very popular option for supermarkets especially Tesco, Asda and Sainsbury’s. To find out more about this, check out our blog post on how AI is affecting the Retail Industry.
Some retail stores have even closed physical stores and opened up as an online-only store which, in some cases, has saved their brand. There are brands such as Amazon and ASOS who started off online, who have understood customer needs and stayed online.
What we think might be in store for the future of Retail
When trying to forecast the future of Retail and get ahead of your competitors, it’s vital to examine some of the customer behaviours around shopping online and in physical stores.
One of the main benefits of shopping in physical stores is the immediacy; people can buy their products and take them away then and there, without needing to wait for delivery. Next-day delivery is becoming more and more popular, with 25% of shoppers even saying they would abandon their purchase if next day delivery wasn’t available, according to a report by Gartner L2.
We have already seen Amazon offer same-day delivery for products, with talk of a drone delivery service that could mean customers could receive their purchases within a couple of hours. As more and more online retailers invest in faster delivery, we could see the same-day benefit of brick and mortar stores become obsolete.
With Climate Change, Carbon Footprints and the Environment in the spotlight at the moment (for good reason), it’s no surprise that we’re seeing brands championing sustainability. Brands like Matt & Nat, a vegan brand who create products such as bags and shoes using recycled materials like plastic bottles. Or, Elvis & Kresse, who tackle the problem of leather waste by recycling surprising items like fire hoses into luxury items.
As consumers are becoming more and more aware of the environmental impact of the retail industry, could we see more of a shift towards ethical sourcing and sustainability? We hope so!
Innovation and Experiences
It’s no groundbreaking revelation to say that, on the whole, people like original things. They also like brands with a coherent brand identity. This could be part of the reason why we are seeing a sharp decline in the success of department stores like Debenhams and House of Fraser; people are being offered too many products.
Department stores operate differently to other high street stores, prioritising ‘sales by square foot’ and therefore packing as many products as possible into the available space. In contrast, the sleek and streamlined layout of Apple stores is minimalist in comparison, and yet Apple sales are consistently high.
The shopping experience, on the whole, is disjointed too. In a large department store, purchases need to be made over a number of different floors, with a sometimes confusing store layout that is difficult to navigate. Compared to an online experience, where several departments can be visited from the comfort of a sofa, department stores seem unnecessary and outdated.
To lure customers back into stores, brands are investing more and more in ‘experiential shopping’, which provides shoppers with an elevated experience. Flagship stores like Topshop at Oxford Circus offer additional activities such as a Bubbletea station and a hair salon, and the new Primark in Birmingham contains the first-ever officially licenced Disney Cafe outside of its resorts and cruise ships.
When it comes to online purchases, customers love to shop but hate to pay; the process is often too long and too messy. From a CRO perspective, a streamlined checkout process definitely has the potential to boost sales, but some brands are going even further.
UBER bills customers automatically for their rides, allowing them to pay without even realising it. This seamless experience is could have the potential to push brands to even more success, particularly on mobile devices where two-thirds of customer dropouts are due to bad customer experiences.
Consumers in 2019 have ever-rising expectations of brands, especially when shopping online. Brands who fail to respond to the demands of their customers are being left behind. Consumers are no longer so brand loyal; if they feel as though their needs aren’t being met they won’t stick around, they’ll go elsewhere, so it’s vital that brands listen to their customers to keep them engaged with their brand.
Our final thoughts
At this moment in time, we still think the high street is alive, and customers are still craving that in-store experience, including the benefits of being able to try on before you buy without having to order three different sizes of a single pair of jeans to send two of them back. However, with retailers looking into delivery within the hour, this may impact the necessity of being able to pop to the shops to purchase something you need that day. To keep up with the competition, retailers need to listen to their customers and find out what it is they want – and be prepared to make some changes.
What do you think the future has in store for the Retail Industry? Let us know! Tweet us @honcho_search or get in touch on Instagram or LinkedIn to share your thoughts. Like keeping up with the latest news and industry updates? Sign up to our newsletter!