For any retailer seeking to understand the business model of the future, it is vital to understand how shopper attitudes and behaviours are changing.

For any retailer seeking to understand the business model of the future, it is vital to understand how shopper attitudes and behaviours are changing.

New research from the Oxford Institute of Retail Management at the University of Oxford’s Saïd Business School and Planet Retail, aims to reveal the different trade-offs shoppers are making in their choice of retailer, the levels of satisfaction with retail experiences, and the aspirations shoppers have regarding technology, stores and service.

In my keynote address at this year’s World Retail Congress, alongside Dr Jonathan Reynolds, Academic Director of the Oxford Institute of Retail Management at the University of Oxford’s Saïd Business School, we presented three realities retailers have to overcome when developing sustainable business models of the future:

There is no such thing as “normal”

What you have to get right in each market – not just to qualify for shoppers’ consideration, but also to win their custom and continued loyalty – is different.

Emerging markets are driving change

While much is made of the levels of retail innovation in mature markets, it is emerging market shoppers who appear more eager to grasp change.

Tackling the trouble with technology

Understanding that significant proportions of shoppers are dissatisfied with and disappointed by the quality and reliability of existing technology. For example, it was discovered that only 15% of global shoppers have had a good experience accessing a retailer’s in-store wi-fi.

It’s now conventional wisdom to think that digital is causing a systemic shift in consumer behaviour, creating what has been called the “new normal”. However, the research, based on a Shopology survey of 13,500 shoppers across 15 markets between April and July 2015,  revealed that making assumptions about behaviours in ‘mature’ versus ‘emerging’ markets may be unrealistic.

“It is emerging market shoppers who are grasping technological innovation and driving change more readily”

Nick Everitt

In many instances, it was found that it is emerging market shoppers who are grasping technological innovation and driving change more readily. It is clear that the need to move away from a one-size-fits-all approach is apparent.

If the headlines are to be believed, we’re ushering in a new era of shopping: where retailers are required to deliver personalised, contextualised and seamless experiences by embracing mobile, technology, and big data.

While extraordinarily exciting, this is too simplistic and carries with it worrying implications for the retail business model. Simplistic, because there are inevitable nuances affecting what the future equilibrium will look like and how fast it will be reached.

It is worrying, because the implication of this future is that shoppers will be even more demanding; that is to say, they will want low prices, great service and seamless technology. Accommodating the needs of modern shoppers, will see retailers having to change their processes, routines, talent mix and organisational structure.

However, it is important to remember that while shopping is changing, the basic principles of retail; great product, strong brands, superior service and compelling ranges remain.

The battle to provide any “new normal” must both enhance the basic principles of retail, not come at their expense, and must be affordable to the retailer. The findings of the research certainly provides a wake-up call for the industry.

  • Nick Everitt, global insight and strategy director, Planet Retail