20-Plus Things to Watch in Retail, Part 1
I was most interested in the report’s "20-Plus Things to Watch in Retail" section, which offers a relatively quick rundown of developments in retail, from innovative business models to shifting consumer behaviors to the latest technology launches. In today’s blog post (part one of a two-part series), I’ll recap 10 of these 20-plus things, such as 3-D printing, alternative brand currencies, and click-and-collect shopping. Check out my blog tomorrow for part two, where I'll discuss the remaining 12 things to watch, including the mobile-powered consumer, speedier delivery and variable pricing.
1. 3-D printing reaches retail. Some say additive manufacturing, widely known as 3-D printing, will revolutionize retail as consumers simply produce goods at home. While this scenario is still theoretical, the report said, Tesco is one retailer really investigating how 3-D printing may enable consumers to design items and have them created in-store or get replacement parts printed. eBay's new Exact app also allows users to custom design and then ship 3-D printed accessories.
2. Alternative brand currencies. The report found that more brands are promoting their goods by giving them away in exchange for various consumer actions (and potential word-of-mouth). For example, chocolatier Anthon Berg created a one-day pop-up shop, The Generous Store, which accepted generosity — e.g., a promise to do something nice for a loved one — instead of money for merchandise.
3. Catering to gender fluidity. Mainstream retailers are broadening their styles and color palettes for men, crossing over into themes and accessories traditionally targeted only to women (e.g., florals and bracelets), the report said. In the kids category, two Swedish toy retailers made headlines last year for the gender-neutral images in their catalogs, including a boy playing with a baby doll and a girl shooting a Nerf gun. And when Harrods debuted its huge Toy Kingdom, the iconic London retailer organized toys by theme rather than gender.
4. Click-and-collect shopping. “Click and collect” shopping enables customers to order online and then pick up the goods at a store nearby. The report found that while many grocery retailers offer this service in Europe, only a few U.S. supermarkets are testing the waters, including Ahold’s Peapod. The report predicted that this type of digital-to-physical hybrid model will expand to more categories, including luxury. Burberry, for example, plans to expand the click-and-collect service it's been testing, according to the report.
5. Clockless day. Today's consumers want to continue with their lives 24/7, whether it’s eating, shopping, exercising, working, etc. Retailers are expected to cater to those expectations and upside-down schedules, the report said. Macy's and Toys"R"Us, for example, were open around the clock for at least two days leading up to Christmas 2012.
6. Cutting out the middle man. The success of vertically integrated e-commerce players like Warby Parker (eyeglasses), Dollar Shave Club ($1 razor blades), Stella & Dot (jewelry) and Bonobos (menswear) will spur a host of new niche brands that cut out middlemen and sell quality products online at below-market rates, the report forecasts. We’ll see a range of direct-to-consumer upstart challengers as the model extends to more categories, from office supplies (Poppin) to bedding (Crane & Canopy).
7. Decline of Chinese bling. Chinese luxury buyers are moving away from overt displays of wealth and opting for more understated luxury goods and products not intended for public display (e.g., pricey housewares), the report pointed out. Warnaco Group Chief Executive Helen McCluskey has cited designer underwear as an “undeveloped category” in China, the report says.
8. Delivery lockers. Retailers are starting to deploy delivery lockers that enable customers to pick up online orders from nearby locations at convenient times, the report said. The goal is to eliminate consumer barriers to e-commerce and avoid the costs associated with missed deliveries. Amazon.com customers in certain cities can pick up their purchases from lockers located in 7-Eleven stores, chain drugstores and Staples outlets. They can also use the lockers to drop off goods they want to return.
9. For-profit chains, nonprofit stores. Watch for retail chains to test nonprofit endeavors that enable customers to take part by simply consuming as normal, the report noted. Nordstrom's Manhattan concept store, Treasure & Bond, for instance, gives all proceeds to local charities. With growing expectations that brands enhance the communities where they do business, watch for philanthropic stores to gain wider adoption.
10. Geofencing. Look for more brick-and-mortar retailers to launch mobile-based programs that target consumers who are in or within range of one of their stores, the report said. While the technology has been in place for a few years, more retailers will adopt it as a way to combat showrooming and survive in today’s hypercompetitive environment. Best Buy, for instance, uses eBay’s price comparison app RedLaser to show shoppers in-store specials and other relevant information. Skincare brand Kiehl’s sends geofenced texts to opted-in consumers in the vicinity of its stores. And Twitter is planning a service that would show promoted tweets only to those users of its mobile app who are in a specified radius.
Check back tomorrow for part two of this blog series.