In 2017, our list of top 7 trends hit the mark. 68% of all sales today happen through a mobile device, retailers with a distinct offering have managed to stay the course and weather the storm of marketplaces, and Virtual Reality is already being put to use to offer customers a more immersive brand experience.
For 2018, we have just five predictions. Perhaps no other business is as proactive about adopting new trends as retail, and this can be seen in the evolving of Machine Learning to understand customers better, personalization in an overcrowded market, and even conscious consumerism. In this article, we discuss not just the trends themselves but a few pointers to help you with implementation.
5 retail trends to look out in 2018 :
1. Machine Learning In Retail Will Be The Norm
What is machine learning? In simple terms, it is teaching a machine to recognize patterns that can help you do business more effectively. Segmenting customers by their buying behavior helps you plan targeted campaigns and suggest products that they can use at that point in time. However, rudimentary efforts often fail in this aspect, and the most common example comes from infant products. It is not uncommon for people who have purchased a crib and a mattress to go on receiving suggestions for baby sets, teethers, bottles and so on for an infinite time period!
As you can see, this approach can quickly get frustrating.
Using machine learning, you can program a system to understand changing needs over time using sales data, identify patterns in it and help you design automated marketing campaigns that hit the bull’s eye.
That’s not all. Machine learning can also bring efficiency into your own supply chain, helping you sell more and faster. Plant and warehouse applications products can help you gain complete visibility of your operations across warehouses, thus saving time in finding lost inventory or tracking where the working capital went.
Machine Learning For Your Business
You may now ask, “But machine learning is an expensive proposition, and I am only a budding business. How can I ever hope to leverage these benefits?”
Luckily, AI and machine learning are not limited to the arena of big players alone. Even small businesses can use existing data to develop models and make better decisions. In other words, you already have the input (the sales data) and the expected outcome (more sales). All you need to really do is find and employ a machine learning expert to develop a model for your business.
Don’t be daunted by the prospect of machines doing the thinking. Taking a leap towards this objective in 2018 will put you miles ahead of several retail businesses.
Bottomline: Machine learning is not just for the big boys. Even small retailers can begin implementing it as early as right now. Consider the business goals in doing so before you begin.
2. Bitcoin Transactions Are Coming
As far back as 2013, Shopify and Overstock began offering the option of paying in bitcoins. However, the true tipping point for these transactions is happening right about now. As the value of bitcoin currency begins to grow exponentially (bolstered by speculation as some say), more people are investing and trading them. As a natural extension, more people are beginning to use them to buy and sell.
Bitcoin and associated cryptocurrencies offer the benefit of buying and selling using a single medium. There is no currency conversion factor involved, nor is there a service charge imposed on high-value transactions. In a world where retailers source products from one country and sell in another, this feature is a distinct advantage.
Bitcoins For Your Business Transactions
First, we recommend that you understand your country’s legal stand on bitcoins. The last thing you want is for your business to be scrapped for breaking the law.
If you are sure that bitcoins are a legal tender in your country and the countries where you buy and sell products to, you can start by setting up a bitcoin point of sale such as the one offered by BitPay. Be sure to track these payments and receipts in your accounting software. This is probably a no-brainer, but never use bitcoins to hide your business data or to modify your books of accounts.
Bottomline: If bitcoins are accepted as legal tender in your country of operation, just offering that payment option can help you come across as a savvy business owner. Also, it is one more way to prompt your buyers to pay using any medium they are comfortable with.
3. Building A Connection With Your Buyers Is Going To Be Important
There’s so much noise in marketing today, it is easy to feel lost. And customers are feeling lost. Multiple retailers sell the same product at different price points. Targeted ads pop up for every search you conduct on Google. Gmail even has a separate ‘Promotions’ tab in the inbox, and it is often flooded.
Is it any surprise then that people are reaching out for some form of connection? A purchase should be a therapeutic experience, and the more we do towards making that happen, the better chance we have of being a buyer’s first choice.
Take this example of a handwritten note that came with a box of hot cocoa.
It is crisp, feels personal and asks for a review without being pushy. This is precisely the sort of personalization that can take your business very far.
How To Connect With Your Customers
Not all businesses need to send out handwritten notes. If you want to personalize the buying experience, ask yourself these two questions:
- If I were a consumer buying this product, what would come as a pleasant surprise to me?
- By offering this experience, what value am I adding to my business?
If you answer the first question with ‘a discount coupon’, ‘a freebie’, etc., it is perhaps time to think through your choices a bit more. In fact, ask a few of your friends and neighbors and take their opinion into account before designing the experience.
The second question is just as important. Leaving a warm, fuzzy feeling is great, but you want to ensure that you have the consumer’s attention. So, build in features such as asking for Amazon reviews, prompting them to join your email list (a QR code comes in handy) or completing a buyer survey. This way, you also achieve the business objective that matters most to you.
Bottomline: Personalization in 2018 can help you stand above the crowd. However, don’t do it for the sake of personalization. Instead, align your experience with your business objectives.
4. Demand For Local Goods Is On The Rise
Today, as people step into the stores of Zara, H&M, and many more large retail outlets, they’re asking just one question- “Who is making my clothes?” Sweatshops in developing countries are causing collective global guilt, with hourly wages pegged at less than $1.
The aware consumer is hence moving towards local goods because they can trace its origins. Also, local products have a story that people find easy to connect with. These two factors mean that apparel made of organic cotton, responsibly sourced and made in a local boutique has greater chances of being sold in 2018 and beyond. Local does not mean ‘within the same town’, but can instead be understood as ‘made responsibly with minimal movement of goods and labor.’
How You Can Go Local
If you already sell products that have a story surrounding their manufacture, your job is made easier. You can use avenues such as newsletters, product description, and social media to highlight each product’s origin. This approach works great for food products.
Naturally, not all products have a local appeal. For example, the demand for electronics is not influenced by where they are made. However, you can use the packaging to reflect the culture of the place where your business is located. Simple doodles, or using a form of art local to that region in your packaging helps you tell a story. It also drives home the idea that you have your roots firmly planted.
For apparel, consider using motifs that tell the story of a place. For example, a crochet detail is a reminder of grandma’s love of knitting. Fringe detailing on accessories, as well as the use of decorative cuffs and collars is a good reference to earlier times.
Most importantly, do it because you believe in it.
Bottomline: Going local isn’t so much about selling products indigenous to the area. Instead, it is about bringing forth the culture of your place of business and using these motifs to tell a story.
5. Conscious Consumerism Is The New Buzzword
Millennials are actually moving towards buying lesser. Burdened by a huge education loan and hounded by the constant reminders that every single purchase they make is impacting the planet, they are willing to spend less on a day-to-day basis and instead invest in a purchase that offers value to their sensibilities.
Livia Firth has taken a stand with the #30Wears campaign to encourage people to wear a piece of clothing at least 30 times before discarding it, and people are following suit. Blue Planet 2, a significantly darker documentary than its first part, has also helped sensitize people to the impact of their choices on the planet.
The millennial consumer wants to make purchases that leave a better impact. They are willing to save up and spend on one product that they can use for longer as opposed to fashion that runs out tomorrow. Your marketing message needs to highlight that you are on the same page.
Marketing To Millennials
For one, think of the social impact your business has in the world at large. Millennials are more likely to support a retailer who has a social story. This is a good wake-up call for retailers to begin getting involved in causes they believe in.
If your business already has a social aspect to it, be sure to highlight it without going overboard. Every other promotion you run doesn’t have to be about saving the world. Instead, use one relevant occasion (such as World Earth Day) to highlight what you do.
Bottom line: Start with small steps. Marketing or otherwise, 2018 is a good time to think about what value your business is leaving behind.
What changes will you be making to your retail business in 2018?