- Vivian Hendriksz |
Retailers who have yet to streamline their online counterpart to reflect their offline brand need to start future proofing their business, as 20 to 25 percent of retail spend is set to be made online. According to international real estate advisor Savills latest report, retailers need to invest in developing omni-channel retailing in order to remain competitive and profitable over the next decade.
The report, entitled 'What lies ahead for the European retail industry,' states that nearly 60 percent of European internet users currently shop online as well and in ten years time, 20 to 25 percent of all retail spend is expected to be generated online. Although the largest share of retail spend and activity will still take place in the physcial brick-and-mortar store, as more and more consumer begin to combine the online and offline world int heir lives they will expect an unconditional opportunity to do the same when shopping.
Retailers need to invest in omni-channel retailing in order to keep competitive edge
"It is now imperative for businesses to cater to the principles and lifestyle of both the rapidly growing ageing population and the dynamic young consumer," commented Eri Mitsostergiou, director of European Research at Savills in a press release. "We have seen how the most successful retailers in Europe have kept in step with these cultural changes, and have merged the digital and physical models of their businesses in an integrated channel."
As the high streets and shopping centres of Europe continue to act as a magnet of social interaction for consumers, they will still feel the need to visit a 'physical destination' whilst shopping. Building up and enhancing the in-store customer experience will be an increasingly essential component for retailers to capture the imagination of consumers. "Stores will become a ‘walk-in-web-store’, with their purpose not being to ‘sell’ products but to offer solutions, service or an engaging experience," added Mitsostergiou.
The company believers that with the onset of big data and technologies, such as near-field communication and facial recognition, retailers will eventually be able to offer consumers micro-personalisations in stores when shopping and be able to tailor their product offer and overall retail experience. Retailers such as John Lewis, who have already been adding convenience to the consumers shopping experience in the form of 'click and collect' services, have in turn inflated consumers expectations.
"The evolving retail world will create new challenges"
"The evolving retail world will create new challenges," explained Larry Brennan, Director of European Retail at Savills. "Retailers and logistics providers will have to be capable of managing much more complex order and distribution channels. For parts of Europe that are remote, under developed, or where internet usage is in its infancy, this will be particularly difficult." In spite of the new challenges that come along with omni-channel retailing, its proliferation across Europe is set to have a positive impact on the retail and distribution sector, with employment in retailing predicted to increase by 6.2 percent by 20225, nearly double the rate of all the other sectors, according to the EC.
"This is a pivotal time for the industry," noted Brennan. "Not all types of retail space in Europe will survive the changes in the sector but businesses must now streamline their marketing strategies in line with tech innovation and changing consumer demand in order to stay profitable and expand over the next 20 years."