1 in 3 online retail transactions happen on a mobile phone (source). Consumers are flocking to the convenience of online shopping. For example, Amazon Prime gives consumers free two-day shipping on purchases and some apps provide same day delivery of items.
We’ve seen major retailers, Sports Authority for example, experience difficulty when faced with online competition. Will this trend continue or will brick and mortar find a way to survive? With the prevalence of online shopping, what will retail look like in the future?
Here are key things to watch in retail moving forward:
More payment options
As we discussed recently, forms of payment are changing with the rise of new technology. We are able to pay with our phones and it is likely that mobile payments will become more prevalent. Consumers expect convenience and, for many, this means easy ways to pay for goods and services. For example, Starbucks mobile app allows customers to reload a “gift card” to pay with their phones and earn points. They even allow customers to order from their phones and pick it up from the counter, skipping the line. Whole Foods and several other retailers now accept ApplePay which allows customers to pay with their debit or credit card through their iPhone. In the future of retail, expect to be more closely tied to devices such as phones when out shopping.
In 2015, almost one-third of holiday shoppers opted to order online and pick products up in store (source). Convenience is king in retail these days. More stores will offer click-to-collect options such as Ship to Store as a way to combat the omnipresent Amazon. By avoiding time in the store, impulse buys are less likely. As technology for inventory tracking improves expect to see wait times on click-to-collect options decrease, making this even more expedient.
Experience focused shopping
In most cases, there is no longer a need to visit a store. We have access to almost everything online with the ability to have it delivered right to our door. What will continue to drive brick and mortar stores is the experience. Stores will have to make consumers want to stop in. Retailers will be forced to provide us with personalized shopping experiences starting with customized promotions. Excellent customer service will also be essential. Since shopping in store is a choice, not a need, poor customer service may quickly drive consumers away.
If you own a retail business, we’d love to talk. We help small business owners set themselves up on a good financial trajectory while being realistic about what’s to come. Reach out for a complimentary consultation today.