2016 is coming to a close. For many retailers, it’s now peak season for your business. While you may not be ready to think about it yet, 2017 is already right around the corner.
With a new year comes new trends in the retail industry.
The industry moves fast. You have to too in order to stay ahead. It’s easy to get left behind by your competition. Keeping that in mind, this article explores retail trends you can expect to see more of in 2017.
2017 Retail Trends
There will be many shifts in retail over the coming year. Today, we’ll focus on five major tends: brick & mortar transformation, customer experience, instant gratification, supply chain integration, and converged commerce.
1. Evolution of Brick & Mortar
Brick & mortar stores are here to stay. While their growth might be stagnating versus the rapidly growing eCommerce, physical stores are still paramount to customers. Customers still need the ability to touch and see the products they want.
U.S. eCommerce sales in the second quarter of 2016 still only accounted for 7.5% of total retail sales.
Store owners are coming up with more innovated ways to elevate the in-store shopper experience. Brand experience is being strengthened by advanced technology like virtual reality, smart-shelf technology, and beacons powered by bluetooth.
For example, retailers such as Ugg Australia, Uniqola, and Neiman Marcus are using “magic” or “memory” mirror technologies, using RFID tags, which allow customers to try on virtual outfits in different colors and styles.
Every customer touchpoint adds values to the customer journey. Stores are very much the foundation of that journey. Retailers who want to stay ahead recognize this and are transforming their physical stores.
2. Customer Experience is Your Best Competitive Edge
It now takes more than price and quality products to set you apart from competitors. Having the lowest price or best product won’t win over more customers.
According to a Walker Study, by the year 2020 customer experience will overtake price and product as the key brand differentiator.
Merchants with a better customer experience will have better customer retention rates, improve customer satisfaction, and increase cross-selling and up-selling. All of these factors can help improve your bottom line.
Gartner predicts that by 2018, more than 50% of organizations will redirect their investments to customer experience innovations.
Merchants who don’t adapt will fail because they won’t be able to differentiate their brand from others. Forward-thinking companies will take time in 2017 to consider innovative ways to continually meet customer demands.
3. More Instant Gratification
Convenience will be key in 2017. There will be an increase in instant services that deliver products faster to consumers, when they need them.
We’ve already started to see the success of such services. Look no further than Amazon Dash Buttons and talking to Alexa to reorder products at home. There’s also UberEats, Postmates, and Instacart for grocery delivery.
Customers are seeking services that are at the tips of their fingers, just a touch of a button. It’s convenient, easy, and reliable. All merchants need to be thinking about how they can create shopping experience that benefit consumer’s fast-paced lives.
4. Supply Chain Integration and Visibility
People are starting to say ‘Logistics is the new black.’ It’s becoming a part of everyday discussions for multichannel retailers. Logistics is key to overcoming the complexity of delivery options that today’s customers now demand.
Customers wants buy online, pick up in-store options. They want to buy online and return in-store, too. Customer also expect free, 2-day shipping upon check out. They want in-store associates to ship a product to their home that is out-of-stock, which is the concept of endless aisle.
Forward-thinking merchants understand that logistics is key to delivering a customer experience that exceeds demands. Logistics connects product, inventory, and order management, giving customers a seamless offline and online experience, as described above.
However, merchants need integration and visibility into their supply chain operations to support all of this. Merchants should have the ability to drop ship with suppliers, work with 3PLs, split orders for fulfillment costs, view inventory levels across the organization, and intelligently route orders for inventory procurement and demand optimization.
45% of retailers have reported that they will invest in multichannel fulfillment technology in 2015-2016, according to the 25th Annual RIS News/Gartner Retail Technology Trends Study. More will follow suit in 2017 by using system integration, data automation, and collaboration to make their supply chain more efficient.
5. Converged Commerce
Today’s customers want to buy anywhere, receive anywhere, and return anywhere across all channels. Channels can be offline, mobile, social platforms, marketplaces, webstores, or others like the Amazon Dash Button.
Merchants have many customer touchpoints to account for. Shoppers often start their buyer’s journey online and then buy in-store, or vice versa. Either way, merchants have to enable their customers to seamlessly shop between offline and online.
Merchants have to handle this convergence of commerce.
Merchants admit that they don’t always do a good job of managing multichannel operations so their customers can buy anywhere, receive anywhere, and return anywhere. However, they do realize that they must do better to provide customers with this level of experience. To do so, they’re investing in the right technology.
But, it takes more than just choosing the right systems, like your ERP, POS, or eCommerce, platform to effectively provide a better customer experience. It’s no longer viable to segment your strategy by just customer type, B2B or B2C, or by sales channels to overcome challenges of converged commerce.
Merchants must dynamically integrate the processes between their systems. This allows merchants to provide a seamless customer experience across sales channels through advanced order management, supply chain integration, product information management, and fulfillment.
For those who want a competitive edge, they’ll invest in integration technology that allows them to better serve their customers across multiple channels. Retailers often look to multichannel management platforms, like nChannel’s, to help overcome these types of complexities.
What to Do Next
It’s not too early to start thinking about what 2017 will bring for retailers. You can expect to see more of these trends next year as retailers evolve to meet customer expectations.
Catch up on other articles about what else is trending in the retail industry: