Author: Thyagarajan Gopalakrishnan
Until a few years ago, you would see scores of people in the shopping mall near our home but in the last two years the people who visit them have dwindled considerably. We got talking with a store owner and he said that profits are lower, and many stores were operating under losses, while a few had already closed and started thinking of new ways to make money.
The reason for the despondence was online shopping as people had started buying online in a massive way. Amazon started making big inroads and younger generations are starting to use it more often, while e-commerce grows in importance.
Though there was despondence due to the success of online e-commerce, the store owner was confident that this would pass too, and they would again be making profits. We were happy that he was still optimistic, but we still had our doubts. Now after a couple of years, we are seeing an increase in footfalls and it seems that the store owner was right after all. The trends in the retail business show that.
Every business is changing with the times and brick and mortar stores are also doing the same. What used to be an impersonal sale is now being provided as an experience. Earlier people were not given their due but now people are welcomed, specialists provide information about products, special discounts are provided, the customer is made to believe that he or she is very important for the retailer.
This customer engagement is ensuring footfalls in stores now. Customers are being tempted with treasure hunts; children are being wooed with innovative techniques. For example, ‘Build A Bear’ by Toys R Us is a big hit and children want to build their own bears and similar stores are also coming up with such ground-breaking ideas.
Women are also being enticed with gifts and personalization. Birthdays and weddings are always remembered by the stores and you get nice messages on such days. The experience for the customer is only going to get better and it is a win-win situation for both the retailer and the client.
Take a look at what the Minor League Baseball is doing. They studied their customers have done several grilling related purchases and thus they partnered with companies related to these products to make special benefits for young athletes, aspiring to be drafted and become MLB expert picks. This is a good example of how companies are adapting to their clients and studying their habits, to improve their own marketing strategies.
Furthermore, improvement in technology is making everything better. The combination between Internet of Things (IoT) and blockchain technology is ensuring that the customer gets a great experience. With the help of IoT a retailer knows what a buyer likes and when such a product is available the retailer can send messages to the buyer and this will in turn increase the bottom line. IoT is only making everything easier for the customer.
Large retailers are still feeling the brunt though they are better off now when compared to a few years ago. And large retailers are large for a reason, they keep reinventing. The decrease in footfalls means it has hit the bottom line in a big way. The high overhead for such large stores is the main reason for the decrease in profits.
These large retailers have now come up with a revolutionary idea: small stores. This way they have smaller overheads, but the customer gets the full value which he usually gets such as best customer service etc. The smaller shops though have less inventory, and some have no inventory too, you just order there, and the product will be shipped to your home. Small shops seem to be the major trend for this year.
Besides, retailers have started looking at other payment options like crypto currency. Some retailers are planning to use blockchain technology and crypto currency to get back the lost glory and to attract a new generation of clients. This will surely pave the way for a new revolution in retail.