Why retail will never be the same as tech-savvy customers change the game
By Carin Smith - Feb 1st, 09:02
Traditional brick and mortar stores still have a future despite the boom in online retail, says Andrew Jennings, chair of the Prince's Trust Retail Leadership Group in London. But, he says, with techno-savvy customers, it won't mean business as usual.
Jennings is the author of "Almost is not good enough – how to win and lose in retail" and was the first presenter in the 2019 Distinguished Speaker series of the University of Cape Town Graduate School of Business (UCT GSB).
"If you are not open to change - especially in retail - you are in serious trouble," he warned.
Online retail is already over 15% of the market in the UK and about 16% in the US.
He said studies show that more than half of shoppers surveyed indicated that they research products online first before they go out to shop.
"There is no doubt that retail will hit 20% [of the market] in the next number of years. Online retail is even growing in SA - by more than 50% - though it is still a small segment of the market," he said.
But some traditional retailers have started to feel the brunt.
Research in the UK estimates that last year 10 000 stores "disappeared". It is estimated that 23 000 businesses will go under in the UK alone this year.
"So, the bricks and mortar picture looks a tad unhealthy. Even over the Festive Season, it was pretty poor for retailers, according to reports we have heard," said Jennings.
At the same time, there are some good news stories, he added. Many retailers are being very innovative, doing things differently.
"These days you have to be 'magnetic' to draw people into your stores. It is not about discounting items, but about creating a focused excitement," he said.
"Customers demand convenience, value for money and transparency every step of the way. Younger shoppers, especially, are constantly comparing products and reviews about it online. They know as much as the retailer about the product and where it was sourced."
Jennings emphasised that it has become vital for retailers to remain relevant to their customers.
"You cannot be half-hearted in the retail industry today. You must deliver to be successful," he said.
"Customers want to be thrilled and entertained by retailers. Bricks and mortar shops do have a future, but only if it is an omnichannel business."
He said retailers must satisfy today's customers while being in line with what the customer of the future wants.
"Customers are time-starved. They want information at the push of a button," said Jennings.Fin 24
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