So apparently I have a thing I do. I didn’t do it consciously, but I guess I have done it regularly: to declare the theme of the year in retail. I went back and looked at all of the articles I’ve written, and this trend started in 2009, when I declared it “the year of the customer”. Here are the rest of the years. You can decide for yourself if I was right or wrong:
- 2010: The Year of Transparency
- 2011 – an off year. I published a trends piece that focused on “Customer Centricity 2.0″
- 2012: The Year of Disruption, Globalization, and Opportunity
- 2013: The Year of Measured Retail
- 2014 – another indirect declaration, the Year of Execution
- 2015: The Year of Brand Integrity
You can probably argue that most of these trends didn’t come or go within one convenient calendar year. We’re all still feeling the impact of transparency, and as China’s markets have proved, globalization. Brand integrity is just as important this year as it was last year.
So what’s in store for 2016?
The Year Of Disruption
I think 2016 will be an unsettled year in retail. The trends are already in play, but there are several that are starting to come together that I think will have a big impact on retail this year. Here are those very disruptive trends:
Mobile is for real.
The 2015 holiday season saw some over-the-top numbers for mobile use. If nothing else, this should prove that mobile has “arrived” – that it is a separate beast from “eCommerce” in many ways, and that retailers need strategies for how to support the mobile shopper.
Retailers have learned a lot about mobile use from consumers over the last several years, but the last year in particular. Mobile conversion is much lower than online, for example, and consumers operate within a different context than using the desktop site, as they could be in a car, in a coffee shop, at a shelf in your store. Location plays a much more critical role in understanding the mobile consumer than it ever did for traditional eCommerce.
That’s part of the reason why I think mobile will be disruptive in 2016. Retailers spent 2015 experimenting with beacons and location-based marketing and promotions. 2016 is the year where I think the volume of that activity will be big enough for most consumers to notice. And as a result, I think 2016 is the year the mobile app will make a comeback – not as an alternative to the mobile website, but as the digital loyalty card, wallet, shopping list, wish list, and persistent shopping cart for engaged consumers. But it’s still going to be a rough ride – retailers just don’t seem to know how to provide a mobile experience that enhances the in-store one. Someone will hopefully figure that out in 2016 – and that will be disruptive.
Omni-channel is passé.
Do you have any idea how many people are trying to kill the word “omni-channel”? I’ve had a vendor tell me that they’ve encountered retailers who are trying to ban the word internally. I confess a degree of impatience with this argument. Omni-channel is not dead. It’s not “over” – we are not living in a post-omni-channel retail world by any means.
But people are tired of it. Here’s where I think the industry is at, in general. I’ve written (and spoken) before that you can’t do omni-channel right without doing it within the context of customer centricity. It is possible to enable omni-channel processes in that vacuum – you can certainly do what it takes to make click and collect possible. It’s a relatively simple thing to put in the online calls into inventory availability to share in-store inventory online (another thing entirely to talk about the accuracy of those numbers).
But all of that – not to minimize it – but all of those processes are just shellac. They are surface level changes to processes, and even the retailers who have embraced them whole-heartedly have done so in a way that merely grafts these new processes onto the existing business model.
I think 2016 will be disruptive in part because we’re reaching the end of what companies can do in omni-channel without stepping back and revisiting the fundamentals of their business model. You know the fundamentals that I’m talking about: that the store is the central place where all transactions happen, that the store employee plays a minor role in that experience, etc. etc.
The companies that are just doing the shellacking strategy are becoming more and more exposed as omni-channel drives deeper into the organization – into supply chain, merchandising, customer service. Even the ones who accept the degree of change required will founder as they make bigger transitions – take Macy’s, the poster-child of omni-channel, and that company’s results and response to those results. I think there is more of that on the horizon.
The way we consume information is changing drastically.
Finally, there’s the whole information side of things. This isn’t an omni-channel story per se, but it definitely has an impact on omni-channel. As the API economy grows, as cognitive computing and natural language processing becomes both more sophisticated and more accessible, and as people get more and more creative about developing user interfaces and presenting information graphically, the way that we all consume information is changing drastically.
2016 will only see an acceleration of the trend. It’s getting easier and easier to bring data together, and the tools to analyze that data are getting more sophisticated, and yet also easier to use. Throw in IoT and mobile, and I suspect that 2016 will see a lot of long-held myths about how people behave thrown to the dirt. I don’t know what those will be specifically, but a lot of them will be about shopping.
Take all those together, and it’s pretty to see how 2016 will be the Year of Disruption – not because there are new, unexpected things happening, but because all of the new things that happened over the last couple of years will finally have big impact on the industry.