How will Kiwi retailers perform in 2016? Part two

  • News
  • January 9, 2016
  • Mike Booker
How will Kiwi retailers perform in 2016? Part two

Stephen Bridle

General manager


We anticipate a slow, but probably not spectacular, increase in consumer spending in 2016. The key question though is: will that be spending on things or on experiences? We think more on the latter than the former.

In theory most retailers should be helped by favourable economic conditions for consumers. Low mortgage and interest rates, declining fuel prices, low-to-no inflation and close to full employment are providing working Kiwis with the confidence to spend. But where, and on what they spend, is changing.

Over the last 12 or so months we’ve seen a rise in spending on hardware and durable goods such as furniture and flooring. A lot of this will be maintenance spending that has been deferred over the past five or so years. It seems to correlate with rising house prices, notably in Auckland. These can be grudge purchases and perhaps it’s no coincidence that we’ve also witnessed a corresponding rise in the hospitality sector. We see no reason for that trend to slow in 2016.

Unfortunately a lot of non-food consumable categories, for example, apparel, books and stationery, footwear and department stores struggled to find sales growth in 2015. You see that reflected in the performance of many publicly listed retail chains. 

A key driver of that is due to consumers spending more online, with overseas merchants. We expect that trend to continue in the coming 12 months. The growth rate will slow, but it is unlikely the amount spent will decline as consumers hunt for value online.


Christina Leung

Senior economist


Although the dairy downturn has cast a shadow on the New Zealand economy, more recent developments show an improving outlook for retailers over the coming year. Consumer confidence is recovering, buoyed by continued solid demand for workers. Businesses are looking to hire staff, and jobs growth is encouraging households to spend.

But with wage growth still subdued there remains a degree of caution amongst households.

Customers are becoming increasingly price sensitive, which is putting pressure on retailers’ margins. Technology is contributing to the low inflation environment by making price discovery easier. The increasing use of online and mobile platforms to check and compare prices means businesses are finding it harder to raise prices.

However, technology also creates opportunities for new business models and poses a threat to traditional businesses, as can be seen with disruptions such as Uber and Airbnb. Technology is changing the way people shop and work, and it will be important for retailers to understand and use technology to adapt quickly to the changing needs of consumers.


Paul Keane

Executive chairman


Retail is a changing environment, driven by consumer demand and needs. Next year will be no different, and who really knows what the future may hold? Here’s our list of what we think will happen in 2016:

  1. The economy for New Zealand will remain robust with full employment.
  2. Small speciality retailers with commitment and a dedicated offering will do very well.
  3. Large format mixed category retailers will have a difficult first six months due to a long hot summer extending into early winter.
  4. David Jones in Wellington will be an outstanding success and be a major point of difference for Wellington’s CBD. Watch for some reaction from Farmers in the refurbishment and repositioning of its Wellington representation.
  5. H&J Smith will announce a successful result since its takeover of Arthur Barnett in Dunedin.
  6. Watch for a decline in bookshop numbers with more closures expected as the merchandise category continues to find trading competitive.
  7. Further pressure will go on the appliance, entertainment and electronic industry with some retailers having to close stores.
  8. Another year of “wait and see” for the Christchurch CBD as retailing continues to stutter.
  9. Online retailing will continue to grow despite any tax being imposed by the IRD.
  10. Trading hours will be lifted for Easter.
  11. Further international retailers will announce entry to New Zealand.
  12. Some concern will be shown at the over emphasis on retail environments at airports and their sustainability.
  13. DIY stores will continue to impact on retail with a wider range and competitive pricing policies.


Andrew Jamieson

Director digital strategy


So what's next for online retail in New Zealand? Continued strong growth buoyed by fibre penetration, decreasing data costs, smart phone ubiquity and digital literacy? Well, perhaps, but it isn’t quite as easy as straight line extrapolation if you want to stay competitive.

Recently in the UK we’ve seen Argos transform its proposition by aligning digital and in-store experiences. They're now allowing shoppers to choose how and when to shop, breaking out of a 'me too' market and transforming their bottom line on the way.

With a billion people logging into Facebook in a day, social commerce has definitely arrived. Winners in S-commerce understand customer ecosystems, not just channels.

How about mobile devices transforming customer experience by empowering floor staff with advice and real time inventory information? A killer app for this cannot be far off.

Keep an eye out for supply chain jumpers. If you think click and collect is enough, then just keep in mind the new kid on the block in European online groceries - none other than DHL.

This story originally appeared in NZRetail magazine issue 741 December 2015 / January 2016

​ ​

This is a community discussion forum. Comment is free but please respect our rules:

  1. Don’t be abusive or use sweary type words
  2. Don’t break the law: libel, slander and defamatory comments are forbidden
  3. Don’t resort to name-calling, mean-spiritedness, or slagging off
  4. Don’t pretend to be someone else.

If we find you doing these things, your comments will be edited without recourse and you may be asked to go away and reconsider your actions.
We respect the right to free speech and anonymous comments. Don’t abuse the privilege.


Gun retail will change after the Christchurch shooting

  • Opinion
  • March 18, 2019
  • Sarah Dunn
Gun retail will change after the Christchurch shooting

In the wake of an appalling attack, public sentiment around guns sales has changed. NZ Retail and The Register editor and associate publisher Sarah Dunn considers how gun retailers can work with the community in this new environment.

Read more
Sponsored content

Protect against porch pirates: The Courier Box

Necessity is the mother of innovation, and this is certainly the case for The Courier Box designer and developer Joanna Steel.


How did that happen: Customisable Products

  • News
  • March 14, 2019
  • Courtney Devereux
How did that happen: Customisable Products

According to the Forbes 2018 trend report consumers are increasingly searching for personalization of products, services, and experiences. From wallets, phone cases, apparel, pet accessories, plates, bedding, and even number plates, if it can be purchased, it can be monogrammed, personalized, and used as a display of our individualism.

Read more

Social scoreboard

Zavy and The Register have worked together to create a scoreboard that compares how the top 25 traditional media advertising spenders in New Zealand have performed on social media over the past 30 days, updated in real time.

Concept to closet
Business coverage of New Zealand Fashion Week.
Town centres
A positive retail environment over the past 12 ...
Amazon Arrival
Keeping up with all things Amazon as it ...
The Retail Yearbook 2017
As we battle our way through the busiest ...
Hospitality enhancing retail
Some think food and integrated hospitality offerings will ...
The future is bright
We spoke with four retailers in their twenties ...
Spotlight on signage
At first glance, the humble in-store sign might ...
Red Awards 2016
The Red Awards for retail interior design celebrate ...
Auckland Unitary Plan
Auckland is changing. The Unitary Plan will decide ...
How to open a store
Sarah Dunn considers what it would take to ...
All things to all people
Kiwi retailers share their omnichannel strategies.
Rising stars
Retail's top young achievers.
Delivering on your promises
The sale isn't over until your item is ...
Retail in heartland New Zealand
Retailers keep the regions pumping, but how strong ...
Women in retail help one another. We spoke ...
The changing face of retail
Shifting demographics are creating big changes in New ...
The retail yearbook
With the help of experts in the retail ...
Retail rogues
We put the spotlight on staff training. Jai ...
Here come the giants
Topshop has arrived in Auckland’s CBD, David Jones ...
Window shopping: A spotlight on social media
Sarah Dunn and Elly Strang look at how ...
From retail to e-tail
Ecommerce has become part of the way mainstream ...
Loyalty in the digital age
How are retailers maintaining loyalty? Sarah Dunn, Elly ...
The Innovators | In partnership with Spark Business
Technology is rapidly changing the retail industry as ...

Here we go again

  • Opinion
  • March 14, 2019
  • Satish Ranchhod
Here we go again

After losing some steam over 2018, another year of moderate growth in retail spending is on the cards for 2019.

Read more

Kathmandu security breach may have captured customer data

  • News
  • March 14, 2019
  • Radio New Zealand
Kathmandu security breach may have captured customer data

Outdoor clothing and equipment retailer Kathmandu is investigating a suspected customer data breach on its trading websites.

Read more

Briscoe Group notches another record annual result

  • News
  • March 14, 2019
  • Radio New Zealand
Briscoe Group notches another record annual result

Briscoe Group has reported a record full year profit after a surge of sales going into the Chirstmas shopping season.

Read more
Next page
Results for
About us.

The Register provides essential industry news and intelligence, updated daily. And the digital newsletter delivers the latest news to your inbox twice a week — for free!

©2009–2015 Tangible Media. All rights reserved.
Use of this site constitutes acceptance of our Privacy policy.

The Register

Content marketing/advertising? Email or call 022 639 3004

View Media Kit