The UK retail market is constantly evolving and as a retailer you must change with it. The retail landscape is very different to a decade ago with potential customers having more options and higher expectations. As a retailer you must act now to ensure you keep your existing customers and gain those potential customers out there.
I believe there are certain trends that are having a significant impact on the retail industry: demographic variations, multi-channel, mobile commerce, personalised messages and changes in distribution. Each of these trends can influence your retail sales, but if you can adapt to all of them they will give you the benefit of becoming a prosperous and very successful retailer.
Different demographics have different needs. There are now many different sections of society which are segmented by age, all of whom buy from you in different ways and have different preferences.
Maturists born pre 1945
Baby Boomers born 1945-1960
Generation X born 1961-1980
Generation Y born 1981-1995
Generation Z born after 1995
As you can see from the above list there can be a vast difference between groups, but all of them could be your potential customers. As a retailer you must be able to communicate effectively with all of them. You need to ensure your older customers still get the personal touch by letter or email, where your younger customers will prefer text messages and interaction on social media. Always remember that different demographics can react differently to different communication and content.
There are many different routes you can take to communicate with your customer. Previously in years gone by you had a brick and mortar store and customers came in and bought your products. Now they can order from a brochure, order online, review online and also still come to your brick and mortar store. According to We Are Social, the UK currently has a population of 64.91 million people. A huge 92% of these people are Internet users, creating a huge potential for your e-commerce business. In 2015 77% of UK Internet users made a purchase online so it is imperative you have a presence online as a retailer. Even though a lot of potential customers do their research online, they still like to come into store to see, feel and purchase the actual product.
According to emarketer.com in 2016 37.1% of mobile phone users will make a purchase on their phone in comparison to 27.7% in 2014 and this number is likely to increase to 44.7% by 2020. 30% of these purchases were made on tablets and the other 70% were on smartphones – so as a retailer you need to have your mobile ecommerce site in place. The mobile experience can also compliment your customers in store buying experience as they can check prices, reviews and do all the research they need on the product they are looking to buy.
Many of your potential customers are looking at advertising messages being personal to them. With increasingly sophisticated algorithms and predictive digital logic models that can analyse transaction data and digital media trends (what is popular on social media) your potential customers may already be getting those messages from your competitors. Requesting user reviews makes your customers feel you value their opinion and can encourage them to be loyal to you. It is important as a retailer that you are customer centric and not product centric as retailers have previously been.
Changes in distribution
Some retailers already offer same day delivery options – Argos and Amazon being just two of them. Your existing and potential customers are looking for the most cost effective and convenient option to them. Delivered items can now be sent to secure delivery locations: lockers, pick up boxes, other retailers and also delivered to their door. If a potential customer wants a product you sell but a competitor can offer a better delivery option then that potential customer could go to your competitor instead of spending their pounds with you. More manufacturers are also selling directly to customers so you need to have that edge as the delivery of the item may be the deal closer. Competition is also now potentially global as more and more customers shop online and the delivery option may be cheaper - China is a prime example of this.
So to ensure that you keep your customers coming back and gain potential new customers, take heed of the points above and be aware that the retail landscape is changing.