Wednesday, August 19, 2009

Easy online access could doom retailing business

Researchers have warned of a surge in online trading and 'anti-retail movement' that could doom retail outlets over the next 10 years.

Some traditional retailing is likely to become obsolete by 2020, as manufacturers choose to sell directly to the public and consumers prefer to deal directly with wholesalers.

Research by Australian Centre for Retail Studies of Monash University (MU) predicts that industries most likely to feel the crunch of this consumer-led change would include computers and gaming, entertainment and media, consumer electronics and beauty.

Businesses that offer experiential retailing such as furniture and household goods, clothing, recreation and outdoor supplies are likely to thrive.

Researchers Sean Sands and Carla Ferraro predict the shift in consumer buying habits, fuelled by the internet and online retail spaces such as eBay, means retailers will need to think outside the box and provide new ways to engage with their customers.

"Consumers are growing tired of 'filters' reducing the transparency of their interaction with the producer of the goods, reducing authenticity of the goods and services they purchase."

They want more direct access to the sources of goods and expect more from the retailer - it's not enough to source the goods alone, retailers need to source better, more often and for less," Sands said.

"This shift has occurred over the last decade, accelerated by the internet and our growing desire to be part of the creation process for the products and services we choose to buy."

Sands said the changing landscape means retailers would have to fight harder for customer share and come up with innovative and inventive ways to retain customer loyalty.

They have produced the Retail 2020 report, which outlines key retail trends for the next ten years based on extensive research conducted in Australia, New Zealand and Asia.
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