As the department store channel shrinks, and more brands fight for less space, our opinion is that brands will need to be more creative, flexible, and diversified in their approaches.
We believe the following trends are where retail is heading in 2017 and beyond.
- The path to consumers will be more direct
- Battle of the marketplaces is set to continue
- Monobrand apparel is set for sustained outperformance
- It is time to close the Runway-to-Retail gap
- Collaboration and internal alignment through Integrated Business Planning (IBP)
- S. retailers will face increased competition in grocery and apparel
- 2017 will be the year of online grocery
- Robots are coming, helping to boost productivity
- Digital tools to improve customer service
- Number of malls will continue to decline and retail real estate evolving formats
- Retail store closings and consolidating will continue
- The right Brick-and-Mortar presence will still be necessary
- Retailtainment (retail marketing as entertainment) is essential in driving store traffic and bringing a store to life
- Online paradigm is difficult for low-margin players, especially department stores
- The decision to build vs. buy technology
- 2017’s key retail theme is, Supply Chain Visibility
- Radio-Frequency Identification Technology (RFID)
- Expect to see more virtual reality shopping
- Wearable’s are making a comeback, spectacles and the case for wearable cameras
Retailers today are confronted by a more complex and diverse business environment than at any other time. With more information at the hands of consumers, new ways they engage with products and brands and a more dynamic competitive landscape, traditional retail is going through a period that is more akin to a revolution than an evolution. The old guard of retailers will need to take drastic measures to remain relevant in this new retail order that is defined by information and technology.
There is no single strategy that is right for every company. The start is the business strategy needed to define required capabilities since the future is uncertain. Businesses need to design for flexibility and speed of execution applying best practices and design to meet objectives and achieve excellence.
The digitalization of a business refers to the strategy, planning, and execution of the right digital initiatives that align with, and enable, the business strategies of the enterprise. Digital is a broad topic, composed of numerous new technologies, new business processes, new business models, and customer experiences. In short, it is a new way of doing business, both externally with customers and internally, including with trading partners.
Companies of all types are facing challenges that are unprecedented, in terms of digital disruptions, competitive innovations, and customer-centric advances. Supply chains are not excluded from these disruptions. In fact, smart digitalization of supply chains can be the foundation for responding to (or getting out in front of) these threats. Amazon is the perfect example its supply chains are fast, efficient, high performing, and customer-centric.
Digitalization of supply chains is not only a defensive measure against disruptors; it is also an offensive strategy for profitable growth. It can yield substantial internal efficiencies, provide much higher agility and flexibility, and radically transform the operational performance of a company for measurable value creation.
We at Tompkins International have developed a Service Line that leads and facilitates a company’s strategy, planning, and execution into the Digital Age. It can take companies at any level of digitalization as far forward as their business strategy envisions.
To further understand the retail trends taking place in 2017 and affecting business please read my newest whitepaper.
White Paper: Retail 2017 Trend Report
Video: Supply Chain Revolutions: Responding to Digital Disruptions
Website: The MonarchFx Alliance