How Will Retailers be successful in 2014?
Pre-Christmas trading has heavily influenced retail predictions for 2014 and many businesses will have to adapt if they are going to survive (never mind flourish) in the coming year. The dominant pattern saw high online sales over the festive period and it is thought that sales via mobile phones and tablets are set to overtake desktop sales.
The ecommerce trade body IMRG and consultancy Capgemini declared shoppers spent £11 billion online alone during December. This amounted to a surge of 18% in online sales which is thought to continue this coming year with the market increasing to an expected 17%. Customers are destined to spend £107 billion online during 2014, but of course the patterns surrounding this rise in online spending are complex.
There seemed to be a polarisation of the high end and cheaper retailers in the festive shopping habits of customers. Premium retailers such as Selfridges, Jaeger, Ted Baker and Burberry saw a swell in sales during the run up to Christmas. Burberry claimed their 12% rise in like-for-like sales was heightened by its click-and-collect service. Click-and-collect is increasingly popular and we will probably see more stores adopting this purchasing option.
Over Christmas food shopping was also diverged with high premium sales, but also cheaper stores such as Aldi and Lidle did well. The middle grocers suffered and consequently, Tesco now plans to revitalise its stores. However, Tesco did benefit from multichannel sales and it is thought that the retailer has invested heavily in its click-and-collect service which has already contributed to the grocery store possessing nearly 50% of the online food market.
With a click-and-collect facility, shoppers often buy extra items after browsing when they turn up to pick up their pre-ordered shopping, so bricks and mortar outlets will continue to play a crucial role in 2014.The focus for the coming year should be convenience and service with the emphasis being on how a brand creates desire in the consumer. This entails making the store exteriors enticing and the interior surroundings appealing. Furthermore, the suffering grocery stores perhaps need to shift to smaller stores which suits customers who lean towards buying less, but more often. Since some of these big brand convenience stores are already in the high street there is a chance for other retailers to benefit from this possible increase in footfall.
The cheap pound shops are already set to attract shoppers away from the big grocery stores in 2014 as they have been doing before Christmas. This pattern fits in with shoppers looking around and buying at various stores instead of doing all their weekly shopping in one place. Shopper promiscuity and fluidity in the market means loyalty is diminishing. Stores will have to work hard to win sales and at the moment the high streets in the UK are not looking great. Empty retail outlets litter the high streets and make them unappealing to customers. New initiatives are therefore needed to help fill these empty spaces.
In order to increase footfall in 2014 and beyond, buildings on high streets need to be presented in the best possible light. This means maintaining the building by making sure that any coating on architectural metalwork is in good condition as well as keeping windows clean and making entrances inviting. Once inside commercial premises, owners need to think about the layout, use of colour and the overall experience for their customers. Researching who their customers are and what they want is paramount here and being original can pay off.