Even by the standards of retail, always one of the most adaptive of industries because of its closeness to consumers, the pace and depth of change has seldom been as fast as at present.
Retailers confront oppressive cost challenges such as business rates and rising wages, which make it harder to earn a crust.
But the biggest challenge – and the biggest opportunity – is to create and sustain profitable business models that are in tune with how people live now.
Consumer expectations of everything from speed, convenience and service through to fulfilment options have changed radically with the uptake of new technology such as smartphones.
Retailers are changing in response: M&S is pursuing a ‘digital first’ strategy, Morrisons has a supply deal with Amazon, and Sainsbury’s acquisition of Argos, as well as bringing enhanced omnichannel capabilities, represented an attempt to create a new type of retailer better able to compete with the Seattle giant.
But most retailers expect tech-driven transformation to continue apace. Every retail discipline is being affected – location strategy and store numbers as online shopping grows, where and how retailers advertise as Google and its peers become more important than traditional marketing channels, and employee numbers and their responsibilities as AI is adopted.
The transformation affects even those retailers that still trade through bricks-and-mortar only.
“When the retail landscape is changing so quickly and so radically, you’d expect Retail Week to change too”
In its results this week, for instance, Primark owner ABF made a point of saying: “Primark’s following on digital and social media grew strongly again. Our website and these social channels are increasingly relevant to our customers, building awareness of our brand and product, and are drawing them into our stores.”
It’s not just consumers that will vote with their feet if retailers don’t cater for them in contemporary ways.
As investors ponder which businesses to back, they are increasingly choosing those with strong digital capabilities. That was clear earlier this month as a Citi note advising investors to go for clicks, not bricks, pushed retail stocks down.
When the retail landscape is changing so quickly and so radically, you’d expect Retail Week to change too.
You’ll still find all the important news you’d expect on our website while, online and in the now fortnightly print edition, you’ll find more focus than ever on the digital shift, the lens through which the industry must increasingly be viewed.
Our in-depth coverage of the dynamics shaping retail will help retailers successfully navigate the changing terrain. We kick off with a comprehensive analysis of voice technology, as pioneered by Amazon.
Amazon sold more than 33 million Echo smart speakers last year, a sign surely that what was once considered science fiction has not just become fact, but is becoming as standard a fixture in many people’s homes as the TV.
Of course not everything that Amazon tries out takes off, but its relentless quest to cater for consumers in convenient new ways has time and again raised the game in retail. Its track record shows that no retailer can afford to stand still in its wake.
In China, ecommerce giant Alibaba has a distinct vision of retailing in the future. “Online or offline? These cannot be the only options,” the etailer maintains in a recent YouTube video, in which it also says that “the complete digitisation of commerce can be the key to saving traditional retail”.
It’s what Alibaba calls ‘new retail’. Perhaps it might just as well be called ‘retail’. Whatever the terminology, it’s surely the direction of travel.
Retail’s adaptability, despite some of the tales of woe on the high street, will ensure the industry’s continued success in years to come. At Retail Week, we’ll continue to do all we can to help retailers navigate the way through exciting, if sometimes uncertain, times.
As always, your feedback is welcome. And do let us know if there are any particular themes and issues you’d like us to cover.
(I’ve added the Alibaba video below. It’s a promotional vid, but thought-provoking - the bits about mom and pop stores and malls/department stores are very relevant in an omnichannel context.)