Retail Outlook: What to Expect in 2016
Innovation and transformation will continue to shape the retail landscape in 2016, and some of the advancements being made can be helpful to both retailers and consumers alike.
Closing the Digital Divide
The digital and physical worlds will continue to converge, not only impacting checkout, but the overall shopping experience. Interactive tools will allow customers to engage with brands, in and out of the store, through collaborative marketing.
Retailers interested in drawing consumers into their stores will employ technology to engage shoppers before they ever walk into the store. This type of interaction will not only connect retailers to shoppers who want to have personalized experiences, it will provide retailers with the ability to connect with shoppers beyond their stores. As consumers use of mobile devices and applications grows, so too will their demand to connect with retailers using these mediums.
Retailers Take More Control of Shelves
Perhaps the biggest change impacting retail will be companies taking back control of the shelf conditions and environment in their stores.
A shift is taking place in retail merchandising, and retailers are seeing the advantages of using data and analytics to decide which items to carry and where to place them. This change breaks from the traditional model where suppliers employed brokers to merchandise items on retail store shelves.
As we've seen, oftentimes revenue from shelf space leads to brand/SKU proliferation, which leads to customer confusion at shelf.
The new approach gives retailers more effective and efficient ways to use existing merchandising dollars while eliminating brand bias. Optimization tools allow retailers to determine which brands/SKUs are needed to meet consumer need, margin requirements and revenue goals. The end result is a more effective and shopper-friendly category set.
Beacons Go Mainstream
The current subtle use of beacons by retailers will increase in 2016. Retailers have been cautious and deliberate with their use of beacons because they want consumers to embrace them, not find them obtrusive.
As more retailers implement the use of beacons — even on a cautious, trial basis — the devices will be an increasingly accepted form of digital communication with shoppers in 2016.
Delivering the Unexpected
In 2016, we will see more entertainment in stores. Retail spaces of all types will become gathering places, similar to what coffee shops have become.
In order to accommodate this type of environment, retailers will begin to make changes to their stores. The key to engaging consumers is in providing memorable experiences that they enjoy. When shoppers are presented with something delightful and unexpected, that’s an experience they'll remember.
Kristen Baird is senior director, insights and analytics, at Interactions, a provider of innovative retail services and experiential marketing for retailers and brands.