Preliminary reports show retail had a very good year in 2017. CBS News reports total sales for the holiday season hit a record $598 billion, up $33 billion from 2016. While we don’t have year-end totals yet, it’s a good bet that overall retail sales were up in 2017 as well. Hopefully, 2018 will be even better for retailers.
2018 Brick-and-Mortar Trends
Check out these predictions for what retailers can expect in 2018.
1. The brick-and-mortar retail store will take on new importance. While headlines in 2017 forecasted the “death of retail,” those reports were greatly exaggerated. Yes, there’s definitely a shakeout going on, and big retailers that overextended themselves are making changes. However, the National Retail Federation reports the number of physical stores in the United States actually grew by 4,000 in 2017, and for each company that closed a store, 2.7 companies opened new stores.
2. Ecommerce retailers work out the kinks. Fast shipping has become an expectation for online shoppers, but the surge in ecommerce purchases over the 2017 holiday season exposed some flaws in the system. Delivery services were overextended (at one point, UPS actually recruited their office workers to drive trucks in order to make shipping deadlines). Meanwhile, an avalanche of returns is expected, as online purchases don’t always meet expectations. Overall, the 2017 holiday shopping season highlighted some of the advantages that in-store shopping still possesses.
3. Customer experience matters. That’s not to say brick-and-mortar retailers can rest on their laurels. To continue attracting customers in 2018 and beyond, physical stores will need to offer standout shopping experiences. In addition to a smooth shopping and check out process, extras such as in-store events, classes, product demonstrations and community involvement can help your store rise above the rest.
4. Product transparency will be increasingly important. As consumers spend less on items and more on experiences, they want to make sure the products they do buy meet their standards for social responsibility and ethical business. This is especially key for millennial and Generation Z consumers. Sharing the story of your products — where and how they were made, the people behind them, etc. — not only builds trust with your customers but can also be a great marketing tool.
5. Customers respond to curated collections. Many big retailers are opening smaller stores to appeal to customers who don’t want to be overwhelmed by product selection. For example, this fall Nordstrom opened a concept called Nordstrom Local. These stores don’t actually carry a full inventory, but use personal stylists to show customers potential purchases and place their orders. For a small, independent retailer, in 2018 it will be more important than ever to showcase high-quality, unique products specially selected for your store.
6. Click and collect is in demand. Can you believe that just 29 percent of retailers in the United States offer click-and-collect, or buy online and pickup in store, as an option? Consumers want this service — and they also want the ability to return online purchases to physical stores. If you do sell products online as well as in your store, you will need to add click and collect and buy online and return in-store to your options in 2018. The bonus of this method: Consumers who come to collect or return products often end up buying something new once they get into the store.
7. Mobile pay takes off. The retail industry has been talking about mobile payment for a long time, but 2018 may finally be the year when it reaches critical mass. Can your customers pay with their phones using Apple Pay, Android Pay, Venmo or PayPal? More and more of them will expect to in the coming year, especially if you target Generation Z or millennials.
8. Conversational commerce changes everything. Voice search will play a huge role in retailing in the coming year. Millions of Alexa-enabled devices sold on Amazon over the holiday shopping season, with the Echo Dot being the top-selling product on Amazon across all categories. Considering that some 75 percent of Americans shopped on Amazon during the holidays, a whole lot of voice search will be going on in 2018. For brick-and-mortar retailers, this means your local search strategy will have to shift to accommodate the way people search via voice as opposed to in a browser.
Are you ready for these 2018 retail trends? What changes are you making to your store to keep pace?