Retail continues a seismic change as the impact on retailers shifts due to evolving technology. In mid-January, Walmart and Macy’s announced plans to close hundreds of stores and layoff thousands of workers.
Walmart is closing 259 retail stores worldwide, 154 in the United States of its 11,600 stores. Macy’s is closing 40 stores this year.
Forbes reports on a series of retail changes and trends including:
• Consumer electronics and apparel retailers will all but cease to exist in five years.
• There is a trend from owning to renting, so consumers can enjoy more of the very latest products released.
• Storefront retailers are expected to easily inform shoppers before they get there is the item they’re interested in considering in-stock now, today.
• Retailers must offer an “experience” customers can’t get when ordering online.
Over the last 10+ years, the first changes were in the growth of online buying with goods shipped. In more recent years, a second change has been the growth of reviews of firms by customers who are pleased with service and products or unhappy. Smartphone growth has fueled that impact.
Not only are shoppers checking the ratings of hitherto unknown restaurants, movies, music and stores, they are now curious how shops they’ve long been pleased with stack-up with other customers or stores.
I had a client tell me he prefers doing business with a national chain in the small town near him, rather than going to a much larger store of the same brand further away.
Convenience is of course important to this regular customer, but having the right goods in stock is also important. We checked the rating of the store near him and he was surprised to find they had 3.0 stars out of 5. He said he’d always been impressed with the welcoming he receives from staff, no lines of customers to navigate not to mention the ease of parking. He compared that experience to the much larger store with wider selection, but where he’s not recognized as a “regular” customer. The smaller store is in a commercial strip, while the larger store is in a mall. Parking and walking to the mall location is more time consuming. Even though the local, smaller store has a 3.0 rating, the mall location is rated 2.0.
Many retailers like hardware and shoe stores thought their industries were immune to the online onslaught. One-by-one, they’re being proven wrong. People will buy power tools, nails, and shoes online. Grainger.com, hardwareworld.com, zappos.com and others are demonstrating this viable business model.
The basics of good business such as marketing, merchandising, brand development and a company’s value proposition are each continuing and in fact of growing importance. To adapt successfully, small retail firms with both a storefront and online venues may be best suited for navigating the shifting sands of technology and customers’ changing demands.
The business fundamentals are more important than ever. You must pay very close attention to your ideal customer segment and core offering to pivot quickly and accurately to track market changes.
Digital marketing is of crucial concern to brick and mortar stores. A full 70% of smartphone shoppers use a store locator to map their route to the store! Your accurate, online presence will directly affect how customers find you, and their way to your front door!