The student has become the teacher. The retail market has undergone a turning of tables, resulting in big businesses striving to mimic small retailers’ agility and ability to quickly respond to evolving consumer behavior. This calls for traditional department stores to echo strategies that have propelled digital natives — and nimble independent brands — to the forefront of consumer awareness and patronage, leaving shuttered bricks-and-mortars and bankruptcies in its wake.
What’s worked for these young success stories is a multifaceted approach to redefining shopper experiences: elevated in-store concepts and refined social marketing initiatives, powered by cohesive data, analysis and artificial intelligence.
This necessitates merchants of all sizes brandish legacy software and systems for updated platforms that deliver deep insights in addition to purposeful brick-and-mortar activations, all which need to be championed with c-level buy-in.
A quick pivot might be necessary for some retailers and brands that have remained lethargic despite the overwhelming data that consumers are increasingly finalizing purchases via mobile devices. They only need to review the top channels for holiday revenue to hit home the point.
According to Salesforce analysis, there was a 29 percent increase in online sales during the Black Friday shopping period – shoppers also placed 48 percent more orders on smartphones year-over-year. What’s more, mobile devices secured a higher percentage – 46 percent of all order shares – than computers for the first time.
“Younger consumers feel better about their finances compared to last year and are planning to up their holiday shopping spend,” Tanya Levina, research director at Fluent, said when discussing her predictions for 2017 holiday shopping patterns. “At the same time, they have lower incomes than older consumers, so it is more important for them to score a deal.”
This deal-mongering tendency of Millennials and Generation Z requires acutely accurate and thoughtful marketing strategies – both online and in-store. From flash sales promoted on Snapchat to temporary retail locations, or drops, the retail ecosystem is evolving at a throttling rate.
“[Generation Z] is very, very well-informed. So their lives are now, due to mobile proliferation, completely documented on things like Snapchat and Lively,” said Leila Aziz during WWD’s L.A. Digital Forum in November. “So, therefore, they’re placing a much higher value on experiences, that then they can turn around and share socially.”
Though pop-up shops can be perceived as a tired mechanism to keep overhead low and foot traffic high, it’s a concept that continues to perform well – and provides an opportunity for shoppers to engage with a brand offline.
“The reason we’re seeing more pop-ups is because that’s what the consumer is demanding,” Yashar Nejati, cofounder and chief executive officer of Thisopenspace, which connects entrepreneurs with short-term retail space, told WWD recently. “They’re really shopping at these temporary stores. We grew 300 percent year-over-year in New York in 2017. I don’t see that slowing down.”
The stats back up the nuances of Generation Z’s consumer behavior, too. According to Accenture’s report, “Digital Dust: Redesigning Retail for the Next Generation,” 70 percent of the demographic will buy off social media and are twice as likely as Millennials to consult YouTube before finalizing a purchase. Given Millennials’ social prowess, this is an overwhelming amount of prioritization of social equity in which brands can devise major engagement — and revenue — opportunity.
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