Is heavy discount the new deal of retail?
According to the @FT, there is plenty of evidence suggesting that consumers are demanding margin-shredding discounts before they even consider opening their wallets and indeed, corroboration is plenty. Just as an example, it is now an established fact that discounted retail – as in outlet retail – is far surpassing the gloomy performances of full-price retail: the outlet market is the second most performing segment after online retailing.
But the @FT looked at evidence is a different and fascinating way by testing the resilience of British consumer through their appetite for posh food around Christmas. And the conclusion is that more consumers shifted to mid-price ranges around Christmas, which supports the evidence they were more cautious about their spending this year. Similar evidence was found in France, with discount and hard discount supermarkets attracting more customers than their mainstream counterparts over the Christmas period. Another proof that consumers tend to rationalise their spending, most likely based on the perception that their purchasing power is shrinking.
If evidence that consumers are demanding discounts are mounting, the question remains. To which point is this behaviour sustainable for retailers? Last month and quite surprisingly, ASOS made a profit warning after heavy discounting halved its operating margin, cutting its share price down almost 40 per cent. And if competition recently demonstrated its ability to maintain revenue growth while offering relatively cheap products to customers, a whole set of questions persists: will it last and can retailers afford it in the long run?More
Innesco survey, in partnership with Maybe*, reveals what consumers want from their shopping experience
For the last MAPIC edition, Innesco has teamed up with Maybe to collect consumers’ insights around Europe about “What is the future for retail and entertainment in our towns and cities?” This social listening project has delivered over 45,000 valuable thoughts into what consumers really want from their shopping experience.
Change is coming to the retail industry, steering retailers to most importantly take the time to understand how their customers shop and what are their expectations of the shopping experience. This question was at MAPIC, the world’s leading retail real estate conference, that took place over three days last November in Cannes with “Transforming reality – Physical in the age of Digital” as this year’s theme. Innesco took this opportunity to offer inspiring and considered answers from 1m people using a combination of social listening, AI and chatbot technology through Maybe* platform.
The report reveals that shoppers’ behaviour is significantly influenced by online research. 59% of consumers consult their phones in-store on purchases they are about to make, which stresses the importance for many retailers to strengthen their social media presence. Consumers are the real influencers; good reviews and ‘instagrammable’ stores are key ingredients for consumers in their buying decisions. With shoppers switching seamlessly between social media, physical stores and e-commerce, enhancing a brand’s online research resources should be a key priority of a digital transformation initiative.
However, in this digital strategy, what has been mostly overlooked is the lack of digital shopping experiences with only 14% of respondents claim to have had a digital experience in a store that has “blown their socks off”. Consequently, there is an opportunity for retailers to embrace digital innovations and grab omnichannel consumers’ attention with unique in-store experiences that consumers can share on social media and in their reviews.
Another important takeaway from the survey for what shoppers really want in 2019 and beyond is the emergence of cinema visitors as shoppers. Indeed, the report shows that 39% of shoppers said a cinema is most likely to draw them to a shopping centre, with 21% of them said they would also shop. Cinemas still have something that streaming can’t match, remaining an interesting investment for any shopping centre considering this offering.
These meaningful insights provide further opportunities to target relevant online conversations in the social media space and deliver for 2019 what consumers want.
Dan Innes, MD of Innesco says: “This social listening project is the first of its kind and the largest ever undertaken in any sector – just another example showcasing how Innesco uses technology, data and other innovations to conduct research and deliver its findings in effective ways. It’s fascinating to see so much valuable data for the retail industry we can collect through social media listening. The latest is a powerful tool to see how consumer views match up against that of professionals working inside the sector and how to respond to it accordingly.”
Polly Barnfield OBE, CEO of Maybe* adds: “The findings of the project have highlighted the importance of stores being active participants in those conversations to drive their footfall.”
Find out more about the findings of the report here.More
Could Twitter’s new in-house features make third-party tools worse?
It is the news that some of social media’s third-party developers have dreaded, and the news that social media managers have long waited for: Twitter is expanding its functionalities in-house. The networking service has announced this week that more capabilities and features will be available in a bid to maximise business presences on the platform.
The first upgrade comes from Twitter’s own third-party tool. Tweetdeck needs little introduction for those who have been in the social media space for quite some time now. The tool, which is useful for lining up a posting schedule, was just upgraded with the possibility to schedule tweets with video and multiple images. As part of the changes announced this week on Techcrunch, Twitter is also considering a controversial desktop layout revamp and bringing another functionality in-house with new analytics tool to track when your audience is most active on the platform.
The social media giant is playing catch up by adding these new features, which are already available from other social media management tools such as the popular platform, Hootsuite. Indeed, Twitter is very late to the party – which hosts a vast number of third party tools with different capabilities.
However, the key reason why Tweetdeck’s new advantages are important is that they will be customised specifically for the platform, increasing its appeal as a functional and efficient platform for business activities. Worthy of note is the latest EG podcast from Bricks & Mortar series with Susan Freeman, an experienced real estate lawyer, who reflected on the importance of building a social media identity for brands. She emphasised that just a few real estate leaders are using social media and how vital it is, in today’s digital landscape, to encourage them to embrace the shift to social. Consumers interact more with brands and social media remains a huge player in that. Now, with Twitter weighing in on more in-house analytics and publishing capabilities, the platform gains more credibility amongst social-shy property players.
With more and more businesses seeing the power of social media to market themselves, social media management tools are seen as vital, and it’s interesting to see Twitter on the path to cutting out costly tools by providing its own. In an ideal world, Twitter would embrace the enormous opportunity to provide all functionalities into a single and free to use platform. At the moment, the social media giant is catching up at its usual slow pace – but here’s hoping these new Tweetdeck features are merely the beginning of something bigger.
Co-op and Amazon plan for grocery growth
With our own aspirations for personal development in mind after the festive period, two growth stories of grocery chains grabbed our attention in Week 1 of 2019. Both Amazon’s Whole Foods and UK based-grocery chain Co-op announced plans for growth this week, with the former planning to increase its store count in US suburban locations, and its British counterpart set to open 100 new stores in key locations in London and the South East.
Indeed, while in 2018 sales in wider retail were continually impacted by shifts from in-store to online, the grocery sector seemed to buck the trend. In the US, online grocery sales account for only 2% of all sales, and remain statistically insignificant in the $800 billion grocery industry according to Forbes.
In the UK, while the big three supermarkets – generally preferred by consumers for the weekly ‘big shop’ – have invested heavily in their online offering, the fact is that online shopping is dominated by those weekly trips. Smaller ‘top-up’ shops account for just 18% of online trips, compared to 57% for in-store. (Neilson via Retail Times) There is clearly just cause for investing in bricks-and-mortar grocery – but that is not to say the sector is exempt from overarching imperatives to rethink store formats in the new age of retail.
Perhaps the most interesting aspect of Whole Food’s planned growth is that the new stores will be some of the first to be built by Amazon – could this mean that they will be designed differently? Amazon has, itself stated that, with its new Whole Foods stores, it aims to expand its quick grocery delivery offering through Prime Now. The new stores could also facilitate fulfillment and returns – so expect them to be designed with plenty of Amazon lockers and online return points. Its growth strategy for Whole Foods is likely to be well and truly omni-channel – creating key added value to drive footfall to its new stores, and away from Walmart which currently operates a leading 5,352 stores in the US. (Forbes)
Co-op, on the other hand, as one of the UK’s smaller grocery players, and operator of aforementioned ‘top up’ stores, has been slow to move into online – but with Amazon eyeing locations for its first Amazon Go store in the UK, Co-op’s growth strategy is considered, and complemented by plans to renovate 200 existing stores. The retailer has stated that its new stores will open in key city centres transport hubs, university campuses and new communities in high rise residential developments. What’s more, Co-op is testing its new food-to-go concept in multiple UK locations, where shoppers under time pressure can grab self-serve products and pay at a bank of self-scan points.
Although bricks-and-mortar grocery has not yet felt the same impact from online as the rest of the sector, consumer preferences will continue to shift towards more convenient modes of shopping. With this in mind, as exemplified by Co-op and will likely be evident in Whole Food’s new stores, creating added value – whether through an omni-channel approach or innovative new concepts – will be key to the future of grocery shopping.More