Monthly Newsletter | FEBRUARY 2017 | Twelfth Issue
S-CUBE Fixtures What's In Store this month

Table of Contents

A Look at Retail in 2026
How did they Grow so Fast?
Going Beyond Millennials
The Rise of Social Shopping


A Look at Retail in 2026
What the retail industry might look like on America’s 250th Birthday, year 2026...


The Robin Report identifies a key driver continuing to impact retail as the convergence of technology and consumer power. As this gains steam the dominance of mass markets and retail scale will give way to an era of fragmentation and local retailing. All retail categories are beginning to feel consumers’ preference for artisanal and diverse offerings.

Millennials will soon be the dominant consumer cohort, but their mindset is already affecting the culture of America, driving a ‘small is better’ lifestyle. Some of the influences include:

• Less desire to consume and own goods, and more interest in sharing, renting, etc.
• Interest in experimenting and finding unique products. Personalized products and services are of great interest; brand loyalty not so much.
• More interest in experiences than products.
• Time is the new luxury, and therefore convenience is key.
• Preference to live in urban areas.
• Mobile is the starting point for every purchase.

Here is a glimpse of what the retail industry may look like…

Malls and Shopping Centers
Almost a quarter of the 1,300 malls in the country will shift to vibrant, entertainment experiences using innovative technology and feature dynamic brands and retailers that elevate the experience. They will become ‘go to’ destinations.

Another 200-300 malls will appeal to their local communities and revolve around the interests of those customers.

More than half of malls will decline because they are not convenient and not experiential enough. They will seek non-retail tenants like healthcare offices and baseball batting cages.

In urban areas, mixed-use villages or main streets will be created to offer products, services and entertainment that appeals to local consumers. These developments will also include residential units.

Department Stores and Branded Specialty Store Chains
Department stores will evolve into flagship centers of entertainment in urban areas with fewer, smaller stores across the country serving as showroom boutiques. The flagships will lease space to third-party brands as well as operate their own private and exclusive labels.

The successful specialty store chains will offer an integrated omnichannel experience with a laser focus on their targeted customers. The number and size of these stores may shrink as their online business grows.

Omnichannel and E-Commerce
The integrated distribution model operating across multiple physical and digital platforms is here to stay and will become the dominant model. Digital will continue to grow at a faster rate than physical retail, but will reach a balance between the two. Amazon and other pure e-commerce businesses will continue to open physical stores, while Walmart will leverage its stores as distribution sites, maintaining its most profitable stores and opening smaller, curated stores in neighborhoods.

Local Neighborhood Stores
It’s the return of mom-and-pop stores! They will provide a special and intimate experience, while being social and community-focused. However, the data analytics and algorithms will also allow the multi-billion enterprises to offer specially-curated niche stores in neighborhoods. Stores within a chain may have different stock and a different look to appeal to local customers.

Many of these changes are happening now – so there is no time like the present to address the transformation required in your organization.



Shopping at a local store


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How did they Grow so Fast?
A McKinsey team surveyed more than 1,000 companies and found five common traits


1. Commit to the Long Term

All sales leaders know they need to anticipate change, but those at fast-growing companies take a forward-looking view of the market and commit resources to it. They monitor the macro-environment and analyze trends on a regular basis, which is not easy given the pressure to hit near-term targets. More than half of the fast-growing companies analyzed at least one year out, and 10% looked more than three years out.

In addition, many successful companies invest in activities where they anticipate growth. Results showed 45% of successful companies invested more than 6% of their sales budget to support longer term growth – a significant commitment given the intense pressure on budget allocations.

2. Use Digital to Create a Competitive Advantage
Successful companies integrate digital fully into their sales organization to increase the effectiveness of the sales force and improve the customer buying experience. And it pays off. Digital channels generated at least a fifth of 2015 revenues for 41% of fast-growing companies surveyed (both B2B and B2C), but only at 31% of slow-growing companies.

To support the sales organization, companies are investing in technology to:
• Arm the sales team with digital tools that can deliver market insights
• Improve data flow between partner organizations with collaboration tools
• Analyze micro and macro trends to improve planning and capture opportunities most effectively

3. Harness Sales Analytics
Effectively using customer analytics can have a powerful impact on the bottom line. Companies that use it extensively see a profit improvement 126% higher than competitors who don’t. It can help sales leaders make better decisions, improve post-sale account management, and uncover insights into sales opportunities. The power is using the data in a predictive manner instead of just historical analysis.

4. Invest in Sales Training
Sales-force training that truly improves sales talent and performance is a key indicator of fast-growing companies. The investment can lead to improved performance in such areas as account planning, understanding customer’s needs, and pipeline management.

5. Combine Clear Vision with Leadership Action
Fast growing companies that implemented performance improvement initiatives contribute their success to two things: Management’s clear articulation of the vision and strategy, and their wholehearted commitment to it. It is best when the vision is bold, specific and measurable. And top level commitment to the vision ensures a focus on the big picture, while overriding internal politics and a reliance on past practices.



Watching your business grow



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Going Beyond Millennials
Broaden your perspective beyond millennials, Gen-Z is gaining steam


For the past five years retailers have spent enormous resources courting Millennials. While it is a large cohort with a significant impact on retail, success is not dependent on one demographic group - but rather staying agile and adapting to constant change.

A lot of good learning came from focusing on Millennials, including using data to profile and segment consumers. But no one generation is “it” for long. Generation Z is already gaining steam.

For long term growth focus on three broader strategies:

Improve your Omnichannel Shopping Experience
Today’s consumers (Millennials and every other demographic) expect a seamless shopping experience across in-store and digital platforms. The reliance on mobile has increased significantly with 67% of American consumers making their final purchases in-store after researching them first on their mobile device.

Unleash the Power in your Data
Consumers leave a long trail of data when it comes to shopping preferences. While it can be a daunting task to dive in, there is much that can be learned to improve your strategies and action plans. Take the time to cull through the goldmine.

Strive for Alignment
Creating a superb omnichannel experience relies on strong alignment across the organization.

Aligning your teams and your information across channels, while creating an environment of collaboration and transparency, will help you achieve brand success and an optimal customer experience.

Bottom line: Focus less on the next big thing and focus more on strategies that will help you stay ahead of the constant change.



GEN-Z in a box



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The Rise of Social Shopping
The entire omnichannel experience can be driven by social media, read how.


Brands need to leverage the data and features of social media platforms to create hyper-personalized connections that get users to buy.

Five emerging trends will influence how social retailing can impact the bottom line.

1. Social Media as the Shopping Cart
Consumers are no longer just browsing on social media, but filling their shopping carts. On sites like Pinterest and Facebook, social users can save multiple items to buy at their convenience. Retailers can grow the number of items they ultimately purchase by suggesting additional products that match behaviors and interests. Facebook is testing formats that feature multiple products in a single ad, triggering content based on real-time inventory so retailers can intelligently sell more while users are on their social journey.

2. Social Media as your Personal Shopper
As messaging becomes more common for transactions and notifications, predictive chatbots will become the new personal shopper. Like their human counterparts, chatbots use visual and conversational analytics to build knowledge over time about a consumer to provide greater personalization. Soon they will pick up on emotional cues, enhancing customer service.

3. Social Media as a Store
Social media is rivaling Amazon and eBay as well as physical retail stores in the way products are merchandised. The next level is using virtual and augmented reality to remove buyer uncertainty. For example, a social user shopping for a bed can use AR/VR to project a virtual bed to see how it looks in their home.

4. Social Media as the Bridge to Physical Stores
Based on location data, ads can show real-time pricing and product availability at nearby stores, encouraging social users to stop by, while allowing retailers to track transaction data against their databases and online campaigns. Some social apps like Waze can recommend nearby retail destinations based on search. In addition, encrypted content can encourage people to scan and redeem discounts in-store.

5. Social Media as Universal Data
Some social media companies allow brands to see where their customers are shopping by aggregating location data across social media platforms. Image recognition allows brands to connect with nearby social users who are posting about their products – or competitors.

The power of social media data, its retail functionality and real-time responsiveness provide retailers with an incredible opportunity to create an exceptional omnichannel experience.



Social Shopping


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