The future of the retail industry
Right now, the future of the retail industry does not look certain. Some of our favourite high street brands are closing their doors to the public, as mobile and e-commerce websites take over sales. It has become apparent that customers would much rather sit in their pyjamas on their sofa to do their shopping – and this applies to all sectors in the industry, from groceries and white goods to fashion. Fashion in particular has a significant presence in the digital world, accounting for almost one third of all online purchases in the UK – but what does this mean for our high street stores?
Trilogy Stores discuss why retailers should consider making a transition into the digital market to stay alive. Whilst some high street stores might fear they are entering unfamiliar territory, if they fail to make a transition, they could face an uncertain future.
The current state of the industry
Retailers operating from stores made of bricks and mortar are facing a struggle. In the last twelve months, approximately 87% of UK consumers have bought at least one product online – with online sales increasing 21.3% in the year 2016, and forecast to increase by 30% by the end of 2017. Consumer buying patterns have shifted a great deal. Consumers are choosing to shop in their spare time, usually on an evening or during the night, making it difficult for retail high street stores to compete with their limited shopping hours.
Retailers are now making it easier to shop online with size guides, speedy delivery, free returns and competitive prices. The need to physically try before you buy is fading away. This is influencing the success of high street stores – driving some of them into the ground.
Start-up and running costs of offline retail are significantly more than online retail – so if online retailers are taking away sales from the high street, it’s no wonder that new companies are choosing to start online, and existing fashion giants are starting to make the transition to digital.
The future is digital
If the retail industry is to stay alive, there’s simply one thing for it: go digital. That’s right, the future is digital for the retail industry. With many big brands already marking their territory online, smaller brands need to consider digital if they are to stay in the game. High street retail, made with bricks and mortar will be no more – the technology revolution is here and it’s time to make the transition.
Some of the most popular fashion retailers in today’s market have proven that there is no longer a need for a physical high street store to be successful in the industry. Many of which have found success solely on online platforms, using e-commerce websites and social media apps to drive business – with big high street names following in their footsteps and favouring digital platforms over high street stores.
It is clear that there is potential in the digital world, and with giant high street stores such as Trilogy Stores marking their presence online, for others to have a chance in competing, a digital transition could be vital. Customers appreciate the convenience of e-commerce and the beauty of being able to shop whilst sat at home, on their sofa, in their pyjamas – they aren’t limited to certain shopping hours, such as 9-5pm in a store.
The power of social media
The rise of social media apps has influenced the success of retailers and big fashion brands – redefining how we have previously looked at fashion. Platforms such as Facebook and Instagram have become essential marketing tools for fashion retailers, evolving from catwalk shows and big shop window displays, retailers now capitalise via their social media profiles.
Retailers not only have their own profiles but they now rely on other app users to promote their brand and products. The fashion industry is extremely competitive, and social media apps have provided a platform to help brands stand out from their competitors. Instagram in particular, has over 700 million active monthly users, with over 40 billion photos shared. With this in mind, the app has become a platform whereby celebrities, public figures and social influencers are used to endorse a brand’s product, guaranteeing a certain level of exposure and success depending on how many followers they have.
For example, model Kendall Jenner has a huge 81.6 million followers on Instagram – when she is asked to endorse a product, or be the face of a brand campaign, she is securing exposure to all those 81.6 million followers – guaranteeing more exposure than most other forms of marketing. This then encourages users to redirect to the brands profile, or their website – if one picture can reach millions of people, then isn’t that more successful than a shop window display?
Rosie Huntington-Whiteley is the face of denim designer, PAIGE jeans, and with over 7.6 million followers, the fashion brand is guaranteed exposure to those 7.6 million followers with every picture that Rosie posts on her Instagram account – tagging the brand in each photo. Fashion brands know that the success of a campaign can be influenced by the level of followers the endorser has. Using a celebrity endorsement encourages a certain level of user engagement.
Meeting customer needs
Recent surveys suggest that the industry should go digital for the sake of retaining their customers. When it comes to customer service, interactions across social media app, Twitter, has increased by 250% in the last two years. Customers are looking for a service which reduces their effort is quick and convenient. Is social media the answer?
With over 32% of respondents, in a recent survey, admitting that phone and voice communication is the most frustrating customer service channel, it’s no surprise that social media has become one of the most popular customer service channels. Customers want a quick response rate, without the need to wait in line, or on hold. Social media provides a platform for customer communication, and with the opportunity to offer quicker responses, this could equal higher willingness for customer spend.
If your company is not ready to go fully digital, then social media is the best place to start to keep your business in the game – however, the future looks to be digital for the retail industry. For high street brands to remain, maybe it’s time to take the plunge and secure your presence in the digital world.