Consumer behaviour is changing, and with it, the global retail environment. Under the microscope, the most noticeable changes post-millennium have been in the world of e-commerce.
Many retailers have had to ditch evolution for revolution in a bid to stay competitive.
Let’s take Amazon, for instance. In 2001, Amazon’s global sales totalled $1bn. In 2015, they took in excess of $90bn. In that same 15 years, many brick-and-mortar, household-name retailers that were taking in excess of $40bn in sales back in 2001, have seen a 70% drop in sales.
At the core of these changes lies a phenomenon that our parents fantasised about, that we grew up flirting with, and that as adults, we made happen. I’m talking about digital disruption.
The speed of tech adoption over the last 15 years, led by millennials, has been frighteningly quick. We’ve adopted the technology quicker than retailers have managed to evolve to meet its needs. Here’s what we know:
Affordability has always been an issue across every income bracket, with every age group, in almost every currency-using culture on the planet. Nobody likes to pay more than they have to.
With online sales up, store traffic has gone down. Retailers have had to shift focus away from the traditional focus on footfall, and reinvest that brainpower into ingenious ways to facilitate customer conversion.
Social media has had a seismic effect on purchasing behaviour and overall brand perception. Reading unmoderated reviews, feedback and comments now has an unprecedented influence on whether or not the purchase goes ahead. Wanting to know what our peers think is nothing new, but never before have our peers been so viral with their opinions.
For millennials especially, phones and tablets are increasingly becoming the tool of choice for purchasing. Last year, 12% of the world’s population made an online purchase. This year, the figure is more like 20%.
Yes. Last year, 8% of the world’s population made their first online purchase. These figures indicate 2015 as a watershed year for online purchasing, a culmination of 15 years of changes to market conditions.
The retailers that have thrived in this environment are the ones that have consistently raised the bar, with better pricing, better product and better delivery. And if it hadn’t been for our (often-criticised) generation, none of that would have happened.