Retailers always face stiff competition. The slow market growth for the retail market means that firms must fight each other for market share. More recently, they have tried to reduce the cutthroat pricing competition by offering frequent flier points, memberships and other special services to try and gain the customer’s loyalty.
In some parts of the world, the retail business is dominated by smaller family-run or regionally-targeted stores, but this market is increasingly being taken over by billion-dollar multinational conglomerates like Wal-Mart and Sears. The larger retailers have managed to set up huge supply/distribution chains, inventory management systems, financing pacts and wide scale marketing plans.
In retail today, retailers’ battle cries include “customer-focused,” “customer-engagement” and “omni-channel,” but their hyphenated focus is primarily on operations, channels, delivery, discounts and products not people. The retailers who will make it big in the next 10 years will be those who innovate and differentiate around people rather than channels. The best of the best, however, will make it a point to entertain, not just “engage,” their customers after all, share of time equals share of wallet.
The face of retail is constantly changing, and over the next decade retailers will continue to dazzle us with the latest product innovations and in-store experiences. However, our bet is that it will still be all about the customer.