BJ’s Wholesale Club Chairman, President and CEO, Chris Baldwin, opened NRF 2019 in January by saying, “I would love to say that retail is back, but that would be wrong, Retail never went away. As I stand here today, I can say that our industry is more healthy, vibrant, innovative and exciting than ever.”
And it’s true. There were 2,000 net new store openings in 2018 and retail contributes $2.6 trillion to the US GDP. With all those dollars being spent, it’s clear that retail is a highly competitive space. Why?
Shoppers have unparalleled transparency and access thanks to mobile resulting in a fundamental shift in how we understand the customer journey. And that can be a scary thought for retail brands — but it doesn’t have to be. Here are some predictions for retail brand marketers to help them navigate the year ahead:
Seamless Shopping Experiences In-Store
Physical stores will offer better and more digital experiences in 2019, with tech to make it easier for shoppers to find items and gain more product information. This should lead to a faster shop for many, where searching aisles and shelves for the right item is replaced by an app that guides shoppers to where they want to be.
Resurgence of Brick & Mortar
Physical stores offer customers a more tangible shopping experience, where they can see products before they commit to purchase, giving these spaces an advantage over online providers. We are seeing stores begin to capitalize on that and add in extras to incorporate more of the benefits of online. Reports estimate that brick-and-mortar store traffic would increase 14 percent during the 2018 holiday season and that retailers in malls, shopping centers and streets would see a 49% lift in foot traffic.
Earlier this month, at NRF, this trend came to life with Doodle, a platform that allows large-scale retailers to leverage in-store click-and-collect points at malls. It enables returns and pick-ups in person without dealing with shipping.
Millennials, a cohort of 80 million, have matured, and with that comes major life events such as marriage and having children. Last year 40% of millennials were reported to be parents — that’s 32 million moms and dads. According to the NRF, millennial parents are more educated than parents in other generations and are more likely to have above-average household incomes. What do millennial parents want? Utility, brand authenticity, personalization and a tech-savvy experience.
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Marketers Get Better on Mobile
Mobile usage has skyrocketed. Mobile has transformed shopping as we know it, so instead marketers should ask, how can we create useful and meaningful connections with shoppers on mobile? More than one third (37%) of US consumers are willing to pay more for a product or service when they can get a superior shopping experience with mobile, according to a study by Worldpay.
Innovative new mobile ad formats such as DPA (Dynamic Product Ads) and even AR are worth investing in. AR ads offer shoppers an incredibly enhanced experience, while also providing the utility today’s consumer demands. And the appetite is there; nearly seventy-five percent of consumers already expect retailers to offer a mobile AR experience.
Self-Gifting on the Rise
Millennials are driving the trend of self-gifting. According to Forbes, more than half of all shoppers said they would buy gifts for themselves this past holiday season, up 15 percent over the last five years. Additionally reports found that self-gifting was up 13% over Black Friday to Cyber Monday alone. Crimson Hexagon reported that posts with hashtags like #treatyoself, #sorrynotsorry and #merrychristmastome increased tenfold between 2010 and 2016. I anticipate this trend will only continue in 2019 and become more of a year-round phenomenon. Marketers should consider this trend when targeting Millennials moving forward.
In 2019 will consumer spending remain strong or will consumers save and hold dollars until the holiday season? Either way, brand loyalty is the key to a successful 2019.
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