We’re making bold predictions for retail trends in 2018. We’re forecasting more growth, more consumer confidence and more hope for the industry.
The beginning of 2017 heralded the “retail apocalypse” (so much so, the term even garnered its own Wikipedia entry). Major department and big box stores announced hundreds of closures across the countries and malls across America saw unprecedented turnover. Retail, as we know it, was announced as dead by leading forecasters from Business Insider, Bloomberg News, Forbes, and more.
The retail model definitely doesn’t look like it did 10 years ago, it’s true. But in today’s digital age with ever changing technology, what industry does? Over the years, retail industry leaders have proven their ability to transform and reinvent themselves to meet ever changing and ever more demanding consumer trends.
Here are our three bold predictions for retail in 2018:
1. More growth for retail
Yes, the last couple of years have been rough to watch with store closings, bankruptcy filings and the abundance of empty, leasable space in malls. While some of this impact was a result of economic recession and a burgeoning online market, this decline can also be attributed to a need by the industry to balance its previous overgrowth. According to The Atlantic, “the number of malls in the U.S. grew by more than twice as fast as the population between 1970 and 2015,” and by more than 40% as fast as our Canadian counterparts.
The good news for 2018 is that the retail sector is still growing by 4.2% compared to year-over-year comparisons released by the Census Bureau. Other good news:
- Retail sales are up by more than $100 billion and more than 4,000 more chain stores will have opened than closed in the U.S.
- 2017 holiday sales were strong; November and December increased 5/5.5% over the same period in 2016, which translates into $691 billion in wages
- On a percentage basis, 42% brands are opening stores, 43% are holding steady and only 15% are showing a net decrease in stores, according to the National Retail Federation.
2. One word – omnichannel
More and more retailers are embracing an omnichannel approach to sales, providing customers with a seamless shopping experience online, by telephone, through their smartphones and in brick-and-mortar stores. For 2018, we will see further growth in the customer experience, connecting both the digital and in store experience with greater personalization and a higher, data driven targeted focus to connect the two.
According to Google, 78% of all local searches on mobile result in a purchase in-store within 24 hours. And even once customers are in brick-and-mortar stores, 71% of all shoppers are using their smartphones for research. Top retailers have embraced the omnichannel approach and are taking advantage of a customer’s journey to purchase – online, offline and across devices.
Customers are even still researching products online Some researchers estimate that digital interactions influence 36 cents of every dollar spent in a brick-and-mortar store so we know both the digital and in-person experiences are linked.
3. More personalized consumer experiences
There is simply no replacement for great customer service in 2018. From your favorite barista remembering your coffee order, to sales clerks greeting you by name, to first-rate recommendations that you can trust, digital platforms cannot match the face-to-face interactions of brick-and-mortar store. Customers want the sensory experience of being able to see, touch, feel and try out items for themselves, to literally kick the tires. Leading retailers are leveraging big data and online shopping/browsing analytics to create a more personalized, experiential customer engagement. Stores are making every visit count, from personalized shopping assistance, to Instagram-worthy backgrounds, to leveraging the human connection by creating a sense of community. Technology like augmented reality, RFID and face recognition software will also be contributing to more personalized consumer experiences across retail platforms in 2018 and beyond.
We’re hopeful that the retail industry in 2018 will continue to grow and adapt. Retail is the nation’s largest private-sector employer supporting 42 million working American and contributing $2.6 trillion to the GDP. Consumers are showing renewed interested and growing confidence in brick-and-mortar stores and we are hopeful that the retail industry and economic impact will continue to be positive.