Where is Retail Headed?

Future trends in the retail industry can be tricky to predict as generally the state of the economy influences how consumers spend their money. Retailers have had to respond to new realities with strategies such as discount stores, factory outlets and slick websites.

Technology will be one of the biggest drivers behind future trends in retail, particularly mobile technology. However, there are other influencing factors like Australia's increasing population - through migration, people living longer and a mini baby boom and a change in generational mix in the workforce. Other trends include:

E-commerce

shopping trolley image on key computer keyboard trollyAs more and more consumers begin to feel comfortable about shopping online, they'll broaden their horizons when it comes to the types of goods they are prepared to buy over the Internet in the future. This increase in e-commerce doesn't mean the end of the traditional store. For many people, shopping online will never replace the conventional trip to the shops for certain items like food and clothing.
Even though both these sectors have experienced growth in online shopping, there are a significant number of people who will always prefer to try clothes on and to feel the quality of the fabric before choosing to buy.

Shopping by mobile phone is still a new thing but as the development of 3G and mobile phone technology makes more advances, the trend to shop on the move using mobile phones should increase. Retailers are now using social networking to drive sales - a product's history is no longer considered as important, with reputation now being replaced by recommendation.

Private label mania

Grey Can With XIn the last couple of years there has been an explosion of 'private labels'. Retail traders from supermarkets to clothing retailers, department stores and pharmacies have all developed their own brands, usually at the expense of smaller brands. While some consumers have stayed loyal, generally the private label goods have been accepted with customers enjoying the benefits of lower prices.

Aspirationalism

Changing lifestyle patterns and heightened expectations mean that people now have multiple goals - we want it all and we don't want to wait. This means consumers are buying more, often using credit facilities rather than the old fashioned saving until you have enough money to buy what you want. Retailers have to adapt to the new expectations, where long term needs are being replaced by short term wants.

Grey Group of people hands in the air

Ethically driven trends

Grey Arrow with Dollar Sign Things like sustainability, organics, recycling, animal welfare, human rights, food miles and environmental impact are already starting to play a much greater role in our buying choices. Customers are starting to pay more attention to these things and will gravitate towards those companies that can demonstrate they deal responsibly with these issues.

Ageing population

Male Older in Blue Shirt with white hair Beard and glassesMore people are living longer and, in general, are enjoying a higher standard of living. Previously the over 50s may not have been targeted by retailers as much as the younger demographic, but as they start representing a far greater proportion of the population who have purchasing power, retailers will need to adjust their marketing, advertising and recruiting. Some retailers have already started employing older workers to adapt to this trend. Baby Boomers represent 25% of the population, but they have 50% of the wealth.