Another challenging year ahead for retailers
Now that the holiday season is over and the high street sales are finally starting to wind down, it is a time to reflect upon performance in 2018 and look ahead to 2019.
At the end of 2018, we saw many retailers with virtually continuous discounting promotions from a week (or two) prior to Black Friday, all the way through to the first few weeks of the New Year. These tactics appeared to have diluted the offers by the time Christmas rolled around, with the level of discounts ramping up as consumers were no longer being lured by the ‘usual’ 20-30% off promotions. In fact, many hard-pressed retailers appeared to get even more desperate, dropping prices by up to 70%.
The shopping spree that bricks and mortar stores hoped to see in December didn’t quite live up to the hype. Springboard’s Christmas Review found that overall footfall declined by -2.6% compared to December 2017, and according to the British Retail Consortium (BRC)-KPMG retail sales monitor, total retail sales showed 0% year-on-year growth in December, marking the worst December performance since 2008.
Retailers faced a challenging 2018 with a raft of store closures, cautious consumer spending, low levels of consumer confidence and a strong movement towards online shopping. 2019 is set to be another tough year ahead – but there are ways retailers can navigate, mitigate and face some of these challenges head-on.
Bridge the gap
The movement of shoppers to the online space hasn’t only taken sales away from physical stores, but has changed the whole shopping experience by heightening customer expectations. It is now critical for retailers to adapt to these rapidly changing shopping habits and, most importantly, boost the omnichannel experience by bridging the gap between online and the physical store. Consistency is key.
It’s all about the experience
Retailers can capitalise on consumers’ desire to build emotional connections and embrace the shift towards experiential customer engagement. There’s a reason why Apple and Nike retail stores are always packed with shoppers, no matter what time of year. They work extremely hard to create unique, meaningful in-store experiences that align with their brand and fulfil more than what a consumer can experience online.
Embrace digital in-store
Brands need to make the most of the digital revolution and use it as an enabler to create better in-store experiences. Greeting customers with their data on hand can provide a truly 1-2-1, personalised experience. Providing your customers with recommendations based on their data – transactional, behavioural, demographics – can show them that you understand them as a unique individual.
2019 is a time for retailers to be relevant, agile and innovative in their approach to encourage customer’s continuous engagement, not only in-store, but across every touch point. And finally, as 2018 results demonstrate, remember that discounting isn’t the be-all and end-all, and that it may actually do more harm than good.