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With the advent of eCommerce and the online powerhouse Amazon’s explosion into online retail, the retail landscape has experienced a protracted and unprecedented period of disruption. The pace of change in the industry has resulted in many iconic, institutionalized brands going out of existence. Sears Roebuck, once thought to be invulnerable, saw its reign atop the retail pop charts evaporate because it failed to transition its distribution model to the new eCommerce era. Once the king of catalog sales, the first shop from home, mail order business model missed many opportunities to be the “Amazon” of retail as it expanded its brick and mortar stores and abandoned the effort to serve its customers through direct sales (D2C). It’s progression from an iconic success story “who had everything” to abject failure and industry irrelevance began when it took its eye off of innovation and got run over by Amazon and its mastery of connecting with customers online.
Recently Payless Shoes, KMART, Toys “R” Us, Dress Barn and other notable, established retailers left the field of retail marketing because they either tried to be someone they weren’t or got caught believing their own strategic rhetoric in a time the rest of the industry was going the other way. “A lot of these things come down to failures of management, and they come down to a failure of objectivity,” said Neil Saunders, managing director of GlobalData Retail. “It’s like the Emperor’s New Clothes, it takes that child in the room to say, ‘You know what? This isn’t very sensible. This is a really dumb decision.’”
The transformation of the retail landscape is occurring in both the ecommerce and brick and mortar sectors of the industry. With total retail sales growth expected to level off to 2 percent this year, or $5.574 trillion, brick and mortar players will need to continue to focus on experience, innovation and streamlining the in-store check-out process. The era of “blanketing the consumer with endless inventory is over. A return to the importance of brands and the experience will continue to trend.”
Consumers will spend $666.28 billion dollars in 2020 through eCommerce outlets, a 12.8 percent growth rate over previous periods. This year will see more D2C brands enter the brick and mortar field of play offering click-and-collect, easy returns, mobile order-ahead and cashier-less checkout. Could the prediction of brick and mortar’s total demise at the hands of internet retailing be waning?
Regardless of the metric measured by the “The Future of Retailing 2020” report, it is clear that retail will continue to be hyper-competitive and disrupted by advances in technology and consumer behaviors. As major players continue to close stores and retool previous strategic assumptions, still other once notable leaders like Borders and Blockbuster will be teched out of business.
Perhaps the most trendy of trends in retail springs from the old adage “what’s old is new again”. Rebuilding a customer centric strategy that places emphasis on establishing trust between brands and consumers will emerge. Mark Parker, CEO, Nike says, “Our brands—Nike, Converse, Jordan Brand and Hurley—are loved by customers all over the world. But we never take that for granted; we know that every day we have to earn their trust—by serving them completely and adding real value to their lives through products and experiences.”
Junction Creative Solutions’ (Junction) professionals have decades of experience surviving and growing in a dynamic and highly competitive retail industry. To learn more on how we can help you take optimal advantage of today’s marketing trends, call 678-686-1125.