Australia’s retail sector will experience four important changes in 2015 that will shape its future. Customers are digitally savvy and changing their shopping habits. From visiting leading retailers all over the world I can tell you that shopping in the future will be fast, personal, seamless, and transparent.
According to the recent NAB online retail sales index ecommerce in Australia is a $16.9 billion growth industry. People are shopping in-store, shopping on different platforms (75 per cent of which are domestic websites) and across different applications and devices. The options and the competition are strong, but Australian retailers still command the majority of market share attracting 75.2 per cent of total online spending in October 2014.
Consumers want to be served quickly. They expect real-time results from the apps that they use (i.e. Uber for rides on demand and the growth of Netflix around the world for shows on demand, that will soon be rolling out in Australia), and expect speed from retailers. Shoppers want to get their hands on their products as quickly as possible and forward-thinking merchants are keeping up by offering speedier order fulfillment options. More retailers are starting to offer same-day delivery in major cities and in-store pickup for shoppers who want to secure their items, but aren’t keen on paying for shipping or having them delivered when they’re not home.
Consumers are more comfortable than ever before with trusted brands and services learning their tastes and tailoring suggestions. It’s more important than ever for retailers to make use of data and analytics to get to know customers and deliver tailored messages, recommendations and experiences. One-size-fits-all promos and batch-and-blast email campaigns are on their way out. Going forward into 2015 expect retail offerings to be more tailored to each customer’s profile, preferences and behaviour. Thanks to big data analytics and personalisation tools like beacons and loyalty apps, merchants can customise various aspects of their shopping journeys, from tailored recommendations, personalised in-store experiences, customised rewards and much more.
Consumers are using multiple channels and devices simultaneously or even interchangeably throughout their shopping journeys. It’s not uncommon for a customer to research products online, compare prices on their phone or tablet, test out the merchandise in person, and eventually complete the purchase on the store’s website or in a brick-and-mortar location. The key is hitting all those channels and connecting them with each other, so the customer has a smooth experience.
Online reviews and comments on social media sites are increasing transparency in the retail world and it’s a positive thing. Consumers want to find advice and base their decision-making on other people’s experiences with products and services. That’s why it’s more important than ever for Australian retailers in 2015 to take control of their reputation on social media. And this isn’t just about responding to reviews. Retailers must initiate, encourage, and even leverage transparency to connect better with customers and increase engagement and sales. More retailers are starting to incorporate reviews into their product pages and allow purchasers to rate their products or service after a transaction.
To succeed, Australian retailers need to understand the trends above and consider how they can adapt and respond to their customer’s changing shopping habits in 2015. Those that don’t, will be left behind.
Vaughan Rowsell is CEO and founder of Vend.