Digital disruption changing retail

The customer is now at the centre of all retail design as the online world provides ease and convenience while bricks and mortar retail provides a better shopping experience, the Property Council’s Retail Outlook heard this month.

Property experts and the retail industry heard from industry leaders such as Kmart Australia Managing Director Ian Bailey and Ernst and Young Chief Economist Peter Crone at the Property Council’s Retail Outlook lunch today.

“What a consumer expects and how they engage with retail stores and products is rapidly changing; 72 per cent of Millennials and Generation Z shop product options online before going in store and 67 per cent of all consumers use social media in store – this data that shows the impact our use of online platforms is having on our shopping,” Ernst and Young Chief Economist Peter Crone said.

“The online space is growing rapidly with online sales accounting for over $20 billion in 2018 and should reach over $30 billion by 2021 with a range of products being purchased from around the world.

“Homewares (20%), media (17%) and groceries (16.6%) account for the greatest share of total spending with fashion (15.5%) closely behind and the growth in online retailers such as Amazon will have impact on the numbers in the years to come.

“This is not surprising when 88 per cent of Australia’s population using a smart phone, one of the highest levels of smartphone usage in the world, and are online for 6.8 hours on average per day – the online space is where people are living and where they are now doing a lot of their shopping.”

The bricks and mortar retail space is also changing with more customers looking for an experience of greater convenience and higher quality products.

“Traditional stores are now more than ever designing their services around the particular preferences of customers and we are navigating through a time of great change and disruption; products must be created that are a continually higher quality at the same affordable prices so that customers can stay on top of current trends at a price that is affordable,” Kmart Australia Managing Director Ian Bailey said.

“Customers are now seeking simplicity, affordability and accessibility and it is up to traditional retailers to meet these preferences.”