25 October 2017

5 predications about the future of retail stores

Author :
“By 2022, brick and mortar retail spaces will be little more than showrooms” Eddie Machaalani & Mitchell Harper, Co- CEOs of Bogcommerce.

In an era of unprecedented ecommerce disruption, the burning question facing all bricks and mortar retailers is what does the future hold for stores?

As a small child I can remember holding my mother’s hand tightly as we walked through crowded department stores, afraid to let go for fear of being lost in amongst the masses of insatiable shoppers.

 Fast forward a few decades and the differences are stark. I recently took my little girl to a household name department store. There was some traffic on the ground level but as we explored the upper levels, a common feature emerged; silence. The top floor appeared completely empty, my daughter marvelled at her new found playground, playing hide and seek in and around the clothes racks.

It is no secret that the technology era has dramatically influenced consumer shopping behaviour. Whilst online shopping statistics rising, what we do know is there is something about the in store shopping experience that still appeals to us.

With the traditional notion of a store quickly becoming extinct, what does all this mean for the future of stores? 

1. Online shopping won’t replace bricks and mortar 
I think bricks and mortar is an amazing opportunity to use our stores and our store staff as a vehicle to truly engage with the community in a way no other retailers are doing” Jim Brett, president, West Elm
What we know is that whilst we like convenience and speed we also like the ‘experience’ of shopping. Furthermore, there are particular products that retailers struggle to maintain online sales for. If we know physical stores will exist in the future, the question is in what form? Predications suggest that the stores of the future may be points of purchase but not in the traditional sense, perhaps they will be more like experience hubs for customers to feel, touch and compare items that they then order for home delivery.

2. Stores will become more responsive like platforms
Like smart phones, stores are heading towards a more responsive, agile fulfilment model fuelled by the latest data analytics technologies. ZARA, for example, has such a responsive supply chain model in place that they only stock the exact number and type of apparel in each specific line that they will sell based on the strength and accuracy of their demand planning and forecasting. This enables them to ensure their physical store space is optimised at all times. 

3. Retailers must optimise selling space 
Following on for the ZARA example, JB HI – FI have developed clever strategies to ensure that their stock is selected in accordance with what their customers want to ‘experience’. That is in contrast to the more transactional items that their customers are happy to buy online. This is an excellent way to make selling space count! 

4. Retailers will diversify last-mile fulfilment options
With Ecommerce changes impacting how retailers and 3Pls do business, last mile fulfilment models are being upended.  Trends like crowdsourcing apps and same-day, more convenient delivery are driving exciting innovations in last mile fulfilment that will continue to emerge in the coming years. Via crowdsourcing, UberRUSH for parcels, Postmates, Deliv and Amazon Flex all currently offer spot-market deliveries.
Meanwhile, with drones offering a means of providing ‘next level’ delivery convenience, early adopter Amazon is calling drone delivery the future of last mile fulfilment and others are quickly jumping on board. In 2016, Dominos pizza delivered a pizza via drone (partner Flirtey), to a customer's door in Auckland. 

5. Stores will become much more experiential—or cease to exist!
It seems that in order to survive the new on demand economy, retailers must compete on experience. Apple is an excellent example of a retailer that providers their customer base with exceptional in store experience. With staff always at hand, customers can try products, ask questions and learn about new functions. In addition, Nordstrom’s new ‘Reserve & Try in Store’ feature enables customers to choose items online and try them on in person in store. Both these examples show ways in which retailers are offering valuable instore experience to drive traffic to their shop fronts.  


With ecommerce transforming the retail landscape, disruption is ever present. And with any big change, there comes opportunity and challenge. One thing is for certain the stores we see and experience today will look vastly different in the next 10 years. The retailers that will thrive in this new environment will be adaptable, innovative and above all responsive. It’s an exciting time for those who are ready, willing and able to jump on board and embrace the new world. The question is, are you?  

Research sources include:


Written By: Luana Clarke

From a young age Luana wanted to become a teacher. She would line up her teddies in a row and teach them for hours on end. However, she eventually grew tired of their nonchalance and has ended up leading a team of producers instead- which she finds far more fulfilling and stimulating!

Luana comes from an experienced production and management background. She has produced and topic generated events across Asia and Australia.

Luana enjoys learning about emerging trends and drivers for change and loves the notion of the 'butterfly effect'- that change can start small but grow immeasurably through a ripple effect.

No comments :

Post a comment