Human Capital Management Blog

Strategies for HCM Professionals

5 Trends Shaping Retail and Why All Employers Should Care #NRF16 (Part 2 of 3)

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By  John Orr, SVP of Retail, Ceridian

In my recent post, I discussed the first two trends — interconnectivity and Omni-store — that are shaping the retail landscape and informing other employers’ practices.  These trends point to the importance of knitting together data, regardless of the channel, to improve the customer and employee experience.

In today’s post, I’m going to speak to the trends around beacons and buttons and Black Friday.

The third trend of beacons and buttons is really about leveraging innovative technology to solve some point of tension for shoppers. This might be a solution for seamless mobile checkouts or a way to improve the brick-and-mortar shopping experience. Examples include a surge of beacon push notifications, a mass rollout of buy buttons on Pinterest, Twitter, YouTube and Instagram, the debut of Amazon Dash, and more companies tinkering with advanced plays like virtual reality and RFID tags.

The traditional mobile app continues to be a point of contention for retailers. There’s the existing feeling that no matter what, every brand should have a mobile app. However, there’s not much proof that every brand knows what to actually do with their corner of the app store.

A June 2015 study by Forrester and RetailMeNot found that of the 500 customers surveyed, 60 percent of consumers who use a smartphone to shop have fewer than two retail-specific apps on their phone, while 21 percent have zero. “Apps are simply too expensive to build and maintain for most retailers, begging the question – what’s after apps?” Forrester principal analyst Sucharita Mulpuru asked in the study. Across the board, few retailers have made their apps useful enough to warrant frequent use.

In March, a Forbes contributor declared 2015 the year of the beacons. It wasn’t, and 2016 likely won’t be either. Until beacons and their geo-targeted push notifications can find a way onto smartphones without requiring customers to both download an app and opt in to receiving messages, there are too many hurdles and too much of the work is on customers’ shoulders.

There are some retailer success stories in the beacon/social media realm: Target showed that there is good use for push notifications and J Crew has been leveraging Instagram and uploading its annual gift guide and using “shop now” ads to speed users towards purchasing. But, if people are barely using retail mobile apps to begin with, beacons are going to be sitting on the sidelines, except for a select few.

In 2015, platforms brought commerce closer to the chest. Facebook, Pinterest, Twitter, Instagram, YouTube and Google introduced buy buttons, flagging items that were available to shop on their sites or that were one click away from a product checkout page on the retailer’s site. However, it’s going to take the consumer some getting used to in order to trust places like Twitter and Pinterest with their ordering and shipping customer service.

Amazon released its dinky Dash buttons on April 1, leading most of Twitter to believe the company was playing a prank. But branded buttons are here, and by pressing one, Amazon Prime loyalists can automatically refill pre-set online orders of Tide detergent, Clorox wipes and Gatorade.

While the buttons were released to a chorus of “are we really that lazy?” from confused consumers, Amazon is just beginning with connecting our homes to their services, and Dash buttons were “an experiment to see if something like this could be done,” said Forrester principal analyst Sucharita Mulpuru.

“The next evolution will anticipate what you need, make recommendations and add more meaning to the service,” said Mulpuru. “The buttons and the brands that go with those buttons are going to change frequently — the main power is at the platform level, not the individual button.”  The buttons themselves may not last, but the technology behind them will only improve.

Insight: Don’t simply adopt a technology because everyone is doing it; make sure it adds value to the customer experience.

The fourth trend deals with the changes to the retail linchpin Black Friday. For some stores, Thanksgiving is for turkeys and not TVs. A growing list of retailers including Home Depot, REI, Cabela’s, Nordstrom, H&M, Staples, and TJ Maxx are opting out and closing their stores. Here’s why:

  • Consumers are tired of the Black Friday build up which is cutting into family time. If they do want to bargain hunt they are choosing more and more to do it from the comfort of their home and on their timeline. According to PwC, 80 percent shopped online this past Thanksgiving.
  • Profit margins are often already thin due to the deep discounting, so opening on Thanksgiving with fewer shoppers in the stores adds additional budget burden for the physical stores.
  • Allowing staff to enjoy Thanksgiving their own way boosts morale. REI closed for Black Friday, encouraging its staff and customers to enjoy the outdoors while socializing it using hashtag #OptOutside. (My post last November focuses on 3 ways retailers can make Black Friday better.)

 Insight: Consider employee work-life balance and overall company culture when making decisions impacting schedules.

 I’ll explore the fifth trend, Personalization, in my next post. If you’re at the Big Show in NYC today, come find me at booth #3642.

John Orr


John Orr is the SVP of Retail at Ceridian. Follow him on Twitter at @John_Orr. 

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