RETAIL TRENDS REPORT - Ampersand · Retail Trends Report: 2017 UK Edition | amp.co Retail Trends...

RETAIL TRENDS REPORT2017 UK Edition

An overview of our report findings from

2016; the top brands in multi-channel

and how to future proof your retail

strategy.

amp.co

Retail Trends Report: 2017 UK Edition | amp.co

foreword


The expansion of multi-channel retail has changed how

we shop. Consumers are a moving target, traversing across

the different channels throughout the shopping journey.

Retailers are recognising that all shopping channels, from

stock management to marketing functions, delivery options

and accounting, are intricately interwoven and should be

approached as such. Multi-channel is now the minimum

standard expected of retailers, omni-channel is what retailers

should be aspiring to, with retailers taking a truly holistic

approach to business operations. By this we mean putting

the customer at the centre of the approach and treating

all channels (mobile, store, desktop, email, social) as one

experience. Over the course of 2016, our reports have looked

at how retailers are approaching these challenges and which

retailers are winning at multi-channel retail. We assessed over

160 top UK retailers and reported on where they are found

wanting in their offering. Features including geolocation,

form adaptability and live stock information, were all a part

of the assessment criteria. As we start 2017, the gap between

the retailers who are getting it right and those that are trailing

behind becomes clearly visible.

This report addresses these features and the other cross-

channel technologies we predict will come to the fore of

multi-channel retailing in 2017.

Read on to find out what will keep you ahead of the

competition in 2017.

Omni-channel is what retailers should now be aspiring to.

Darryl Adie

Managing Director, Ampersand

foreword


2016A Year in Review

Retail 2016 / General


2016A Year in Review

3%2 Hour

41%

More than 1 day

Retail 2016 / General

Offers faceted navigation

Offers non-store collection Offers automatic geolocation (on desktop)

Offers automatic geolocation (mobile)

Click and collect offering and fulfilment speed

high streetretailers

sells online & has stores in UK

Home Delivery Offering

Source: Ampersand Retail Matrix February 2016

Offers persistent cart

Offers real time stock info

72%

15%

35% 15%

23%9% 9%28%

76%28%

59%

72%

41%

9%

71%

63% 37%

28%

29%

85%

Yes

Yes

Yes

Yes

No

No

No

No

No offering

SundayEvening Same DayNamed Day Next Day

Same dayNext day

YesYes

No

No

Retail Trends Report: 2017 UK Edition | amp.co Retail Trends Report: 2017 UK Edition | amp.co

0

20

40

60

80

100

stock checkNumber of retailers that allow users to check stock in a particular store.

Yes No

33%

67%

Can you check stock in a specific store?

save or share a basket

Is there a save/email basket functionality?

Source: Ampersand Multi-channel Retail Report


0

20

40

60

80

100

stock checkNumber of retailers that allow users to check stock in a particular store.

Can you check stock in a specific store?

Retailers offering save or share a basket options.The nature of mobile shopping is disjointed with interruptions to the shopping journey. Save or share a basket options allow

customers to return and pick up where they left off at a later date.

save or share a basket

27.7%

72.3%

Is there a save/email basket functionality?

Yes No



RETAILEveryone is getting in on the action

UBER FOR EVERYTHING


RETAILEveryone is getting in on the action

2016 was the year that “uberization”, the phase “it’s like

Uber but for…..”, became a short cut to explaining how a

new technology would revolutionise the approach to a

product or service. What would “uber but for retail” even

look like? Uber allows users to order a taxi at the touch

of a button from their smart phones, track the journey of

the taxi until it reaches them, and complete the journey

without the need to use cash as part of the transaction as

the payment details are already stored within the app. All

the benefits that Uber offer, such as geolocation, stored

payment methods and up-to-date delivery information,

should be built into the mobile strategy of any retailer

hoping to stay at the forefront of multi-channel retailing.

This isn’t a new dawn of online retailing – it’s a standard

that many retailers were already meeting in 2016.

Uber are already stealing the march on many retailers

and applying their model to the retail market, rolling

out a B2B offering to retailers in New York, Chicago and

San Francisco. Uber are offering a pay-as-you-go delivery

service for retailers, with the same real-time monitoring

features and an easy to use set up and installation

that ensured their “taxi” service was so successful. As

consumers put pressure on retailers to offer instant

gratification, even when buying online, this new delivery

service looks set to be another success story.

UBER FOR EVERYTHING


In September this year a group of Vogue editors had

a public spat online with fashion bloggers and came

away looking out of touch with the new way of doing

things. American Vogue’s Creative Director wrote “Note

to bloggers who change head-to-toe paid-to-wear outfits

every hour: please stop. Find another business. You are

heralding the death of style.”

In an age where an Instagram user with over 5000

followers can earn upwards of £150 just for posting a

picture, retailers need to take note on who is most likely to

engage with their target market. Alpha Influencers such

as Chiara Ferragni have over 7m Instagram followers, UK

Vogue has a circulation of around 200,000. The platform

and method of communication may differ but which is

more relevant to a retailer when looking where to spend

their advertising budget?

In November, Facebook owned Instagram announced

that they were expanding their retail offering, rolling

out enhanced adverts with 20 selected partners in the

US including Kate Spade, J Crew and Abercrombie and

Fitch. The adverts include product details such as price

when tapped within the picture. The “shop now” button

then loads the retailers site within the Instagram browser

allowing the shopper to complete the sale without ever

leaving the app.

Whilst Twitter haven’t officially killed the “Buy” button,

several news sites have reported that development on

it has ground to a halt and the development team have

been disbanded. Will Instagram have more success than

Twitter with its social media selling offering in 2017?

Social Influencers Are Shifting The Power Balance


Facebook has already taken their in-app advertising to

the next level, offering personalised in-app chat bots to

communicate with buyers when they click into an advert

on Facebook. In October 2016 Facebook allowed these

chat bots to take in-app payments, something other social

media sites have struggled to implement with any degree

of success, with the exception being the Chinese owned

WeChat. WeChat has an estimated 800 million users with

an estimated 300 million using its payment facilities, at

present there is nothing in the West that can compare

with this level of success. After high profile security

blunders at Facebook, it will need to work hard to prove

that it can be trusted before its ecommerce offering will

be attractive to shoppers.

Snapchat is another social media giant using its

popularity to make a power play in the retail market.

No longer the preserve of teens, Snapchat’s market

share continues to grow with an estimated 217 million

users by the end of 2017 (as predicted by eMarketer).

In February 2016, it announced plans to roll out an

ecommerce platform. Building on the popularity of

its “Discovery Platform”, a story telling platform well

suited to fashion retailers and the “Snapcash” service,

a payment feature, it’s a natural step to combine the

two elements to produce a shopping platform. So far

this is limited to shoppable adverts within the discover

platform, where users can “swipe up” to see more details

from an advert and then go on to purchase without ever

leaving the app.

CHATTER-BOTS


CHATTER-BOTS

As all social media companies continue their bid for

world domination it makes sense that they will continue

to develop and refine their ecommerce offering. In the

future, it’s likely that group chat features, in app payments,

social advertising and chat bots will come together to

allow groups of friends to shop together online without

ever leaving their favourite social media platform.

What retailers need to remember is that, ultimately, it’s

about usability for shoppers. Is the experience enjoyable,

secure and integrated? Is it a good place to shop?


KEEPING IT UNREAL


Pokemon Go was the phenomenon that ensured that

Augmented Reality (AR) entered the wider public

consciousness in 2016, even though many retailers

have been using the technology to enhance shopper

experience for several years. For example, Ikea introduced

the technology back in 2013 to help customers visualise

how something may look in their own homes before they

buy. Beauty brands have also been using augmented

reality technologies both in-store and on their mobile

apps to demonstrate products, often combining AR with

other technologies such as face scanning or geolocation.

Virtual Reality takes augmented reality to the next level.

Augmented reality layers’ virtual elements onto the real

world, whereas virtual reality creates a totally immersive

experience, creating a virtual world around the user.

In the ecommerce market, virtual reality gives pure-

play retailers an opportunity to provide shoppers with

a virtual 3D channel and create some of the benefits of

being in-store. This could give pure-play retailers a way to

compete in the one area that bricks and mortar stores

currently can’t be beaten in: having a physical bricks

and mortar store. One huge blocker to this at present is

the fact that the customer would need to invest in a VR

headset to use this feature, whereas bricks and mortar

retailers can invest in bringing VR into store, enticing

customers in-store and using the technology to add to

the omni-channel journey through gamification and

personalization.

The take up of both virtual and augmented reality by

consumers will depend on whether retailers work out

how to use it to improve the shopping experience rather

than as a gimmick. With over $658 million invested

in this area in the last year, per the Harvard Business

Review, this may happen sooner rather than later.

KEEPING IT UNREAL


Under half of all the retailers assessed in our 2016 multi-

channel research had an app in the app store, and of

those 79, only 24 had a link to the app on their website,

with even fewer actively promoting it through pop-ups

or banners on the page. However, this isn’t the end of

the App story. Retail apps are not just limited to brands

providing another place to shop; apps that bring together

several different retailers, such as ShopStyle or Groupon,

are becoming more popular with consumers and with

retailers looking for another channel to access the market.

Retailers and consumers alike want apps that make

shopping easier and frees up their time. For consumers, it’s

all about UX – the experience when using the app, but for

retailers it will be about how easy it would be to integrate

a third-party app seamlessly into their current systems.

For retailers looking to sell their products through a

third-party app it would be wise to see which ones are

most popular with their customer base and whether it

will easily integrate into their existing systems.

Apps: Evolve or DieAMBIVALENT ABOUT APPS

Retailers with and without an app


Apps: Evolve or Die We surveyed 159 leading retailers to see if they had an app.

AMBIVALENT ABOUT APPS

0

20

40

60

80

100

With Without

79 80

Retailers with and without an app


Payments is seeing continued disruption as non-banking

payment service providers, such as Apple, Amazon

and Facebook and smaller tech start-ups, like Chain

and Ripple, grows. Innovations such as Apple Pay or in

app payment systems like Uber are making it easier for

consumers to leave their credit cards at home and still go

shopping. Furthermore, Apple is expanding their Apple

Pay service beyond bricks-and-mortar stores, to both

mobile and desktop Apple devices. Google have also

announced that they are bringing a competing service,

although a release date for this is yet to be announced.

Near Field Communication (NFC) technology means that

any enabled device can be used with contactless payment

terminals, continuing the trend for wearable technology.

Last summer Visa used NFC to equip its sponsored

athletes at the Brazil Olympics with payment rings, that

were water resistant, didn’t need charging (unlike a

phone) and essentially acted as a wearable contactless

credit card.

The challenge for retailers will be in adapting their

back-end systems quickly enough to keep up with new

technologies. Retailers will also need to decide whether

the work involved in offering multiple payment options

to their customer base is worth the return. At this stage

the debit or credit card is still by far the most popular

method of payment, particularly online. In 2017 we

predict that mobile payments will continue to move

towards becoming the new standard for consumers to

make purchases, in-store and now also on a desktop.

As this method of payment becomes the new standard

it’s likely that the term “mobile payment” will seem

unnecessary and we’ll simply call it payment.

Disrupting the payment status quo


Disrupting the payment status quo


EMERGING TECHNOLOGIESIN ECOMMERCE


EMERGING TECHNOLOGIESIN ECOMMERCE

A Product Information Management system (also known

as PIM, PCM or Products MDM) is a tool that helps retailers

to centralise the information about their products in one

place and share it across all retail channels. It’s an essential

tool for any retailer aiming for omni-channel success.

Traditionally, each channel might require a different

version of product information for each item. One version

for in-store, one for online, one for print, one for the UK

market, one for the US market and so on. A retailer with

thousands of products, across multiple categories, with

different variants, in different countries and languages,

should not be managing product data in unwieldy

spreadsheets when PIM tools are readily available.

A PIM isn’t just about admin efficiencies and product

information accuracy, it also enriches product

information with detailed product descriptions, high-

res photos, and embedded videos to guide customers

toward their purchases.

Using the right PIM means that retailers can reduce

duplication of effort and take a nimble approach to

product management across multiple channels. The net

result for consumers is accurate, up to date information

on which to base their purchasing decisions and, as

such, a more pleasurable shopping experience. The

result for retailers is increased loyalty from customers,

increased spend across all channels, and reduced

resources in managing product data.

Using an integrated PIM for a successful multi-channel strategy


Google sums up the importance of speed in ecommerce

in their explanation of AMP accelerated mobile pages;

“AMP is a natural fit for e-commerce because AMP makes

web pages fast, and fast pages help with purchase

conversions.”

AMP, or accelerated mobile pages, was launched

in October 2015 and a little under a year later they

announced that they would be using AMP across all

mobile search results, identifying which sites have been

“AMP’d”.

The question retailers should ask themselves is whether

they want to run two versions of their site (a mobile and

non-mobile site) or whether developing a responsive

web design that adapts to any device would be a better

solution.

Another factor that can impact page loading times is

where the user is located and where the server hosting

website is located. Someone in India using a site hosted

in the UK for example, is going to experience some lag

in loading times. Technologies such as Fastly are being

used by retailers to help with this issue. This is particularly

important for fast changing sites with dynamic content.

Fastly uses a combination of device recognition,

geolocation and caching relevant data to provide fast

personalising shopping experiences for consumers with

the most up to date product information.

THE NEED FOR SPEEDMobile Speed

Number of retailers, separated by mobile speed score.Mobile speed scores still have room for improvement with only 3% achieving top scores of 76 – 100.


THE NEED FOR SPEED

0

20

40

60

80

100

0 - 50 score 51 - 75 score 76 - 100 score

Mobile SpeedNumber of retailers, separated by mobile speed score.

Mobile speed scores still have room for improvement with only 3% achieving top scores of 76 – 100.

30%

2%

68%



Integration is key to the success of any multi-channel

operation. Using a disconnected ecommerce platform

guarantees a retailer won’t have a single view of your

customer or understand how they shop. An integrated

strategy ensures that whatever you have online represents

exactly what you have in-store, making life easier for

consumers and for in store staff to serve shoppers and

provide accurate information. Consumers regularly hop

between channels in their purchasing journey, browsing

online, then having a look in a physical store before

going online again to review and assess pricing and

delivery options and perhaps even getting a shopping

app involved along the way. If retailers want to mirror this

shopping behaviour they need to architect solutions that

provide up-to-date information across multiple systems.

It isn’t realistic for most retailers to simply start their IT

architecture all over again, so any new systems will need

to integrate with legacy systems that are likely packed

with important data about the consumer. An integration

platform makes this happen by allowing heterogeneous

systems and applications to communicate with each

other without the need to develop expensive and

problematic custom integrations.

Why all retailers need an integration platform


Website design, particularly in retail, have established rules

and boundaries that at present are standard across the

board. Having a pre-existing set of rules and conventions

to follow when designing an ecommerce site certainly

makes our job a lot easier as we can design beautiful

looking websites with a layout that retailers and their

consumers are familiar with. These conventions have been

developed and honed though years of user testing with

designers and developers working together to establish

which design conventions work best.

Indeed, many UX experts would advise against moving

away from the standardised framework of a menu across

the top, a scrolling screen and items presented in neat

boxes stacked on top of each other. However, whilst

this homogenisation of design may be the best option

for most retailers now, new developments in CSS grids

are opening possibilities for designers to come up with

something new stylistically speaking. It will be much

easier for web designers to use these developments

to create exciting and ground breaking layouts,

transforming user experience rather than conforming

to the status-quo. In 2017 this rule breaking approach

is for the brands that want to push boundaries and are

brave enough to accept the impact on their online sales

as they test uncharted waters. Other retailers will likely

wait until the mistakes are made and learned from by

others before upsetting the design apple cart. What all

web designers will benefit from is the ease with which

developers will be able to build more complex layouts

and design features. This can give designers more

confidence to try innovative layouts and test new ways of

providing optimal user experience.

Going off grid


Going off grid


running a heavily discounted campaign online, needs to

able to forecast the impact on in-store staffing and react

according.

CIO’s need to be as involved as Ecommerce Directors,

Marketing Directors and CEO’s when developing a retail

strategy and making decisions. Technology can’t replace

people, but by understanding what can be achieved

through using it effectively it can help retailers deliver

world class experiences for customers.

Darryl Adie


[email protected]

+ 44 161 236 5504

Conclusion

Our research supports the view that the key to multi-

channel retail success is the seamless integration

of systems that make it possible to adapt to new

technologies quickly and harmoniously. Make no mistake,

technology disrupters such as Uber, soon become the new

normal as customer expectations change based on their

experiences. When one retailer raises the bar, the retailers

that can’t or don’t respond quickly enough soon look out

of touch. Brand reputation and brand loyalty suffers.

Investment in an Integration Platform is an essential part

of ensuring the legacy systems can still operate when

new systems are introduced, future proofing your multi-

channel offering. A siloed approach to each retail channel

is the wrong approach. Treating the online element of

a retail business operates totally separately to the bricks

and mortar element is to misunderstand how consumers

want to shop. A retailer offering in-store click-and-collect,

Methodology


Darryl Adie


[email protected]

+ 44 161 236 5504

Conclusion Methodology

Whether retailers provided clear information on payment

options and returns policies

Website navigation and product information including

clear signposting, imagery, faceted navigation and

alternative payment methods

Geolocation information – whether customers can find the

nearest store by using geolocation

Real-time stock information for online orders and the

ability to check stock in a specific store

Persistent cart across different devices and whether the

retailer has a transactional mobile website

Delivery options, Click & Collect, non-store pick up options

and communication of free returns

To create the list of retailers, we first aggregated various

existing lists including but not limited to IMRG, Experian

and Sitemorse. This gave us over 2,000 retailers to research.

We eliminated retailers that had no ecommerce presence

and/or no physical stores in the UK. The remaining retailers

were split into their appropriate sectors.

The Ampersand Retail Matrix criterion is our view of

the core tenets of multi-channel retailing. These tenets

cross the boundaries of digital and physical customer

experiences. Within the research there are scoring criterion

and non-scoring criterion.

The scoring criterion include:

Page load speeds and performance on desktop and

mobile using Google Developers PageSpeed Tools

We awarded 4 points for the following criteria:

• Transactional mobile website

• Persistent cart

We awarded 3 points for

• Stock check in-store

We then calculated the final score to be out of 100:

=100/29*SCORE.

When publishing percentages, numbers have been

rounded to the nearest whole number.

The survey was conducted online, independently by

Ampersand, in Manchester, UK on an iPhone 6s using the

Google Chrome browser on iOS9 between 20 January

2016 and 20 February 2016. The research covered desktop

and mobile websites, not apps.

Copyright

All research, Ampersand Retail Matrix and criterion is

intellectual property of Ampersand Commerce Ltd.

Data findings or copy in this report can be quoted in any

medium but requires credit either by name (Ampersand)

or link back to the company website, amp.co.

Non-scoring criterion include:

Delivery method availability for reserve and collect, same

day, next day, named day and evening including costs and

thresholds

Availability of guest checkout and gifting

Ability to login or with social media

Availability of wishlisting and whether or not login is

required

Scoring

Retailers were then scored against the criterion and with

a weighted formula, ranked in the Multi-channel Retail

Matrix.

To calculate the base score marked out of 29 possible

points from 50 criteria, a retailer was awarded points if it

scored positively for each of the scoring criteria mentioned

above, with these specifics:

• Offering click and collect same day

• Desktop Speed >81

• Mobile Speed >71

• UX Score =100

Ampersand is an award-winning commerce agency that

helps established high street retailers build better online

stores. Ampersand works with multi-channel retailers, such

as Harvey Nichols, Poundland and Bensons for Beds to help

increase conversion and efficiency through the strategic use of

technology.

amp.co | +44 161 236 5504

RETAIL TRENDS REPORT - Ampersand · Retail Trends Report: 2017 UK Edition | amp.co Retail Trends...

Documents

Transcript of RETAIL TRENDS REPORT - Ampersand · Retail Trends Report: 2017 UK Edition | amp.co Retail Trends...