In a sentiment which carried across nearly every presentation at the summit, Dr Elms said that growth in online spending had led to radical change for the retail sector: . “Retailers react to change and are agents of change.”
He said customers are pursuing a better offering and better service, but thanks to the ongoing legacy of the GFC, are often not prepared to pay a premium for this. They now demand a “real, long-term, credible, authentic,” experience rather than a transactional interaction.
Dr Elms says online sales now account for 10 percent of retail sales in New Zealand, equaling a total of $7.5 billion. however Kiwi shoppers are actively seeking out foreign retailers to buy from as well.
Dr Elms listed a number of emerging trends to watch: consumers shopping across channels; globalisation of shopping events (such as Cyber Monday); mobiles and smart technology; consumers shopping ‘glocally’ by finding the best products from their immediate environment and also browsing and buying further afield; click and collect; cashless payments, and ‘frictionless’ experiences.
Gazing into his crystal ball to talk about the future of retail, Dr Elms said the scholarly consensus seemed to be that online sales would level off at about one third of total sales across retail. The roles of physical stores could change, depending on the context – some might become more like showrooms, while others could get smaller.
Dr Elms felt the need for convenience in parking and the location of physical stores might become more pronounced as consumers demand greater ease of access.
For those retailers looking to adapt to emerging trends as quickly as possible, Dr Elms recommended they start manouvering in a flexible way as soon as possible. He said understanding the needs of their local communities would give retailers an edge over international competitors, and investing in their employees by recruiting and retaining talented staff would stand them in good stead.