Realising the art of the possible in retail - 3 reasons why the high street is set to survive
Rebecca Swindell 270003U1MK REBECCA.SWINDELL@UK.IBM.COM | | Tags:  withers ibmbcuki connect twickenham business
0 Comments | 857 Visits
This is a guest blog from Chris Withers, Head of Smarter Commerce, IBM UK & Ireland.
In October, IBM is holding its Business Connect event in London to identify the trends that will define the future competitive landscape. In the retail sector, this means adapting to rapidly evolving customer behaviours. It's clear that the rules of retail have changed. As a recent study by Kantar demonstrated, the big four grocery retailers in the UK are under pressure and cannot just rely on their size advantages to attract customers any more (http://www.kantarworldpanel.com/global/News/Big-four-under-pressure). What's more, consumers are experiencing promotion fatigue and after years of recession, are hoping for something different - a better experience. However, this can only be achieved through a better understanding and servicing of the customer, which sometimes requires face-to-face contact. While retailers can no longer just grow sales by opening more shops, traditional retail methods need to find their place alongside the new possibilities in retail.
Financial viability for FMCG
In some sectors such as grocery, retailers have been cautious about going online - and rightly so. Due to the nature of food shopping, when offering online shopping and delivery, grocery retailers will take on a considerable amount of effort and cost that would previously have been covered by the shopper - selecting products, processing, packing and transport - all now have to be accounted for by the retailer, while still trying to keep prices low. Instead, large retailers are concentrating on opening smaller outlets on high-streets, where top-up grocery shopping can be undertaken on a 'small but often' basis. Speciality shops that can provide unique products and services are also likely to gain more prominence on our high streets too, as customers seek out individual experiences.
People like shops
This 'retail experience' cannot be replicated online. "83 % of shoppers say they are more likely to do business with brands that allow them to personalise and control where, when and how they interact through their preferred channel combination" and NCR report found. The shop is the ultimate channel for providing the personalised experience that shoppers crave. The challenge is continuing this experience online, and on mobiles, because alongside personalisation, convenience is high on the shopper's list.
The recent partnership between Ebay and Argos demonstrates there is life in the high-street and despite shop closures and warnings of its demise. The high-street is still finding the ways to adapt to the changing consumer behaviours. Ten years ago who would have thought that one in ten items would be bought via computer, and a quarter of those on a mobile device? Could we have predicted discounting would become a way of life for retail to the point where shoppers would tire of offers and expect something more? The challenge is now to combine the efficiency of online with the local convenience and familiarity of the high-street.
Industry experts and IBM Thought Leaders have identified the key trends that are shaping the business landscape for organisations of all sizes and a re covering them at IBM Business Connect 2013 on 8th October, at Twickenham Stadium: http://bit.ly/BCSOCIAL
Check out what is happening at Business Connect by following @ibmsoftwareuk and join in the conversation using #IBMBCUKI.