Reports that we are in the middle of a retail apocalypse are – quite simply – untrue. If you still aren’t convinced, consider the following: Business Insider reports that retail sales in the U.S. are growing by 200 billion dollars annually and physical retail is still leading the charge on retail sales. Yet the same Business Insider report found that e-commerce is growing at nearly 4 times the speed of physical retail, so don’t take those numbers to mean that it isn’t a competitive retail environment out there. It is more important than ever for retailers to make high margins, so that you have liquid capital to reinvest into your business through your mobile website, automation technologies, social media marketing strategy and more.
Below, gain insight on three challenges retailers will face 2019… as well as how to defeat them in order to exceed margins and make 2019 your best year yet!
#1: Facing Global Competition
As the world seemingly gets smaller and shipping times narrow, retail businesses face an increasing level of competition from overseas retailers, as well as from catch-all e-commerce sites such as Amazon. With all of this international competition for sales, small retailers must learn the value of marketing products to a global marketplace in order to strengthen their margins. In other words, businesses of all sizes should be selling their goods online and with easy navigation via mobile experiences, as well. In addition to the potential to beat overseas retailers at their own game, small to mid-size retailers have the advantage of shipping to local clients at lower price points and with shorter shipping times than their foreign competitors. Key takeaway? Focus on your strengths to beat out mass and overseas retailers for your customers’ business in the new year.
#2: Invest In Your Mobile Catalog
There are many ways to invest your hard-earned dollars in 2018, but among the most important to help maximize your profits will be to invest in your mobile catalog. A strong mobile catalog of your inventory is key to making margins this year. In fact, according to MultiChannelMerchant, mobile purchases currently make up 19 percent of online sales in the United States, but that number will rise to 27 percent by the end of 2018. Even if you’re not ready to invest in building a mobile app for your store or business, it is difficult to overstate the importance of having a mobile-first website with an easy-to-navigate online catalog. Small to mid-size retailers can no longer afford to ignore mobile commerce, so make the commitment to reinvest a portion of your profits into building a time-proof omnichannel presence for your store.
#3: Ease Into Automation
There is no need for independent retailers and marketplace sellers to be intimidated by Amazon’s ever-expanding robot army. Instead, focus on understanding the technologies that are actually applicable to your sales strategies and your customer base in the New Year. For instance, did you know that Forbes reports that 69 percent of customers expect retailers to launch augmented reality apps in the next 6 months? As we enter a period of unparalleled technological expansion in retail, here are two technologies to consider to stay up to speed:
- Customer Service Chatbots - Customer Service Chatbots are both surprisingly affordable and easy to customize based on your business’s most commonly asked customer questions. Consider implementing a simple chatbot on your website to respond to basic customer service requests and help you save on billable hours.
- Augmented Reality Apps - You are probably already familiar with augmented reality shopping apps from mass retailers such as Ulta’s Virtual Try-On Lab or Lowe’s in-store navigation, but in 2018 augmented reality will become mainstream for retailers of all sizes.
Finally, while we can speculate on what will come in a brand New Year of retail operations, nobody knows exactly what the future will bring. It is important for retailers to have the flexibility to adjust to whatever technologies and challenges lay in store for them in the coming year… and the years ahead. Make high margins your priority so that you have the freedom and the liquidity to adapt to this next phase of evolution in the retail industry, ensuring you can stay relevant in an always competitive marketplace.
Take advantage of ASD Market Week’s 90+ free retail strategy sessions every March and August.
By Nicole Leinbach Reyhle, RetailMinded.com