RetailWeek’s new report reveals UK retail leaders’ thoughts on the industry, including their opinions on e-commerce and m-commerce.
Produced in association with Kurt Salmon, ‘Retail 2014’ takes a look at the challenges and opportunities that face the retail industry in the coming year, including recent economic growth and consumer confidence. The report emphasises the modernisation of retail, away from property acquisition to investing in the omnichannel experience (referred to in the report as ‘more clicks than bricks’).
Retail Week asked twenty five industry leaders how they forecast sales in 2014: one forecast them to be much better, nine as slightly better and fifteen as being flat. This indicates that while the economy may be picking up, the retail industry needs to meet some significant challenges in order to drive growth. The chief executive of a speciality retailer said: ‘multichannel, in terms of growth, is a very significant and positive trend. Consumers reaching out for multichannel will accelerate’.
The other industry leaders agreed, choosing ‘investment in multichannel/omnichannel’ as their top priority for 2014, closely followed by ‘investment in customer service and customer experience’, ‘international expansion’ and ‘investment in mobile’. This enthusiasm for omnichannel investment is supported by recent figures from the IMRG Capgemini e-Retail Sales Index, which revealed that online retail sales were up 20% year on year in November 2013.
“The start of 2014 is marked by the greatest clarity yet of how technology has reshaped the sector and, in the search for a single view of the customer, what great retailing looks like in that new environment.”
Having a ‘single view’
An integral part to omnichannel development is having a ‘single view’ of the customer, in which the customer’s online and offline dealings with a brand are integrated into one whole experience. Only 29% of retail bosses asked currently have a single view of both their stock and their customer, but as their second and third highest omnichannel priorities respectively, having a single view is gaining importance in the industry. One managing director of a department store said, ‘this is the most important area of omnichannel by far. Our vision is to make every customer feel like a VIP.’ Another chief executive noted that having a single view deals with the issue of inappropriate direct mail and marketing, as companies should have a better idea of each customer’s interests and tastes.
“For many retailers their online business is their biggest store, but in the next couple of years it is more likely to be their mobile app.” – Helen Mountney, Managing Director, Kurt Salmon UK and Ireland
Investing in mobile
However, retail leaders’ top omnichannel priority is investing in mobile, which they say will ‘become the defining feature of the industry’. More than 20% of consumers asked would buy more groceries or clothing by phone or tablet in the future, which increases to 43.9% for under-25s. As one chief executive said, ‘for young people, the idea of buying from a desktop is antiquated. Mobile is the future’.
While international expansion may not be ranked as high as omnichannel investment, it is still a key priority for retail leaders, with 58% claiming a greater share of revenue from international business in the coming year. One chief executive pointed out that the UK is a relatively small market compared to many of its international counterparts, thus presenting a number of opportunities to British businesses. Another industry leader reiterated the importance of e-commerce in relation to international strategy, as companies could have a digital presence in a country before a physical one.
‘Retail 2014’ shows a cohesive vision for the UK retail industry in the year to come. With a renewed focus on growth, industry leaders are looking towards omnichannel investment to build their brands and improve the customer experience.
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