4 Things to Know About the State of Retailing Today

As retail continues to evolve, it has become clear the old ways of thinking that pit digital vs. physical no longer apply. Today’s consumers go from browsing an item on their mobile phones, to reserving it online and then picking it up in-store, and they expect the same seamless, frictionless experience at each point in their shopping journey. However, it’s not just consumers changing the shopping landscape. Forward-looking retailers are mixing the best of both worlds, bringing technical innovations to transform the store environment while also adopting traditional models of service to enhance the digital experience.

With the rapid pace of transformation across the industry, it’s difficult to predict what shopping will look like a decade from now. However, findings from the National Retail Federation’s most recent State of Retailing Online survey, released in partnership with Forrester, provide insight into what’s in store for retail’s immediate future. The study, which examines the attitudes and investments retailers are making both in stores and online, revealed the following:

1. Technology is Transforming the Store Environment

Overall, more retailers surveyed said they'll be opening stores in 2018 vs. closing them, providing an alternative view to the claims that e-commerce is displacing the physical retail world. However, this doesn't mean the store environment is staying the same. Many retailers are rethinking physical retail with efforts like endless aisle and streamlining checkout and point of sale. They’re not just focusing on technology; people remain critical to the store experience. Case in point: 61 percent of those surveyed are planning to invest in employee training and development.

2. Omnichannel Continues to Evolve

Omnichannel is yet again a key store investment area. Twenty-one percent of retailers said their top customer-facing in-store priority for 2018 was omnichannel efforts. Fulfillment and shipping constitute a significant part of this, with retailers focusing on multiyear initiatives such as improving shipping times, in-store pick up and pricing.

3. Digital Retail Continues to Be the Bright Spot it’s Been for Years … But Experience is Key

Retailers’ e-commerce businesses have been buoyed in recent years by strong mobile commerce performance and improvements in key metrics like conversion rates, but shopper experience is critical to continuing to fuel growth in these metrics. Personalization is one of the primary ways retailers are planning to improve the online experience. In 2018, this will involve clienteling and tailoring offers and images to reflect specific shopper preferences or factors such as the weather or geography.

4. Mobile Shopping Still Has a Long Way to Go

Mobile is the top digital priority for retailers in 2018 as they continue to see a significant percentage of traffic from mobile devices. However, mobile still lags in terms of conversion. To address this, retailers are investing in improvements to their mobile content and search engine optimization. What are they spending less time and money on? Apps and tablets. Despite substantial efforts over the years to deliver great app experiences, respondents to the survey report that mobile apps only generate 4 percent of their online sales on average compared with 32 percent coming from mobile browsers.

Katherine Cullen is the director of retail and consumer insights at the National Retail Federation, where she is responsible for NRF’s consumer holiday research, developing NRF’s quarterly Consumer View, and overseeing new consumer trends research initiatives and partnerships.