Daymon Worldwide Releases 2015 and Beyond Global Retail Trends PredictionsNovember 18, 2014
STAMFORD, Conn., (NOVEMBER 18, 2014) – Global consumables retail leader and Private Brand pioneer Daymon Worldwide today released its seven ‘Global Retail Trends Predictions for 2015 and Beyond’ to help retailers address the widespread retail industry fragmentation and increased global e-commerce competition impacting future retail success.
“Retailers around the world are facing a seriously fragmented retail landscape, with consumers on every continent having more choices in terms of where and how they shop than ever before,” said Andres Siefken, CMO of Daymon Worldwide. “The notion of a primary store has all but disappeared, as consumers shop multiple formats for everyday needs. Digital growth has also fragmented the supply chain, as shoppers now have more choices for online ordering plus multiple points of fulfillment such as in-home delivery and click and collect models. The actual role of the primary shopper has also changed as the responsibility is increasingly shared by several members of the household. For global retailers, all of this fragmentation means investing the time and marketing muscle into offering ‘nowhere else’ experiences and products, including a robust, innovative Private Brand line that attracts the interest and loyalty of target consumers.”
Daymon Worldwide’s Global Retail Trend Predictions for 2015 and Beyond:
According to Siefken, Daymon Worldwide’s global trend predictions will help retailer and supplier partners to better track and respond to future consumer needs and preferences. Each trend was identified through the lens of Daymon’s Global TrendwheelTM, a proprietary tool that tracks 7 Consumer Megatrends and 54 Microtrends that impact global retail success. The predictions are:
1. Retail Gets Micro-sized (Megatrend = Shifting Demographics)
While 2014 saw significant proliferation of small format stores — that was just the beginning. This coming year, small format stores will see tremendous growth, specifically in three key segments: discounters, ethnic food retailers and small box fresh-focused retailers.
Smaller format stores have appeal for obvious reasons, driven by urbanization, a rise in smaller households and consumers’ changing notion of convenience. However, these particular segments are poised for even greater growth, with increasing relevancy to today’s changing demographics and the curated proposition each offers to
- Discounters, from dollar stores to hard discounters, offer the low predicable prices that cash-strapped consumers are seeking
- Ethnic food retailers provide authenticity and credibility in our increasingly globalized world
- With growing consumer quest for fresh, retailers that can deliver fresh options make consumers feel better about their food choices and also closer to the source of supply
2. Retailers Create Wellness Ecosystems (Megatrend = B-Well)
Intense pressures on social and healthcare systems, including increasing fragmentation, primary care physician shortages, a growing aging population worldwide and global consumer focus on wellness, will inspire retailers to provide better health and wellness options for their customers, beyond just rolling out in-store health clinics. This year, we’ll see retailers find ways to create total wellness management models for shoppers in an effort to be their “go to” place for wellness. This will extend far beyond pharmacy, OTC and vitamins into lifestyle destinations for food, general merchandise, wearable technologies and even beauty.
3. Retail Gets Under the Microscope (Megatrend = Always On)
Increased connectivity and information sharing on the fly through social media and mobile applications, coupled with a sense of greater responsibility for one another globally, arms consumers with the information and inspiration they need to share opinions and perspectives that can make or break retail success in an instant. This “under the microscope” position has retailers increasingly being scrutinized in once behind the scenes areas of the business, including supply sourcing, responsible production, ingredients and health information, level of social responsibility and even pricing. From more retail initiatives around supply chain traceability to showcasing locally relevant price transparency, in 2015, we’ll see increased retailer and manufacturer transparency become the price of entry.
4. Services Come to the Forefront (Megatrend = One World)
With a growing aging population spending less on “stuff,” but willing to spend more on services and a Millennial population demanding a “do it for me” culture, we’ll see retail consumption go down, but spending on services increase. Retailers will offer more value-add as well as fee-for-services to make shoppers’ lives easier. For older consumers, this may mean new financial or healthcare services. For Millennials, this could include convenient shopping options, beauty and grooming stations, even food services, –anything to make it easier for them to get what they need while enjoying the ride. For retailers, these services will be used to drive foot traffic, identify completely new revenue streams and add value to get shoppers to buy more, such as by offering cooking classes and wellness services.
5. Hyper-Focused Retail (Megatrend =YOUniverse)
The idea of micro-sizing is not only about square footage. This coming year, we’ll see retailers creating more focused propositions to gain share and relevancy with very specific targets. Specialty retailers will create hyper-specific formats for niche audiences or demographic groups. Mass retailers too will look for growth from new concepts that are highly specialized. Even large chains will focus on specific consumer or lifestyle segments, such as a series of life stage concepts, designed to grow with the consumer. This will also play out as retailers develop concepts to become supreme masters in their trade.
6. Breaking the Rules to get closer to the Consumer (Megatrend = Joyment)
Gone are the days when you put out product and expect shoppers to come and get it. Today’s competitive landscape requires that retailers and brands work harder than ever to get closer to the consumer. These products, services and experiences must have purposes and value that resonate with consumers on a more emotional, meaningful level. Retailers gain cultural capital by offering content-led products and services designed to personally connect with the specific needs and desires of target shoppers. Brands and retailers will continue to step out of conventional molds to go bold with programs designed to gain stronger connections with shoppers. This breaking with convention to drive consumer engagement will become the new rulebook. Private Brands will also play an even more important role in reenergizing the store and driving connectivity by establishing a cult-like following with shoppers. It’s all about getting the shopper to say, “I must HAVE….”
7. Balance of Power Shifts Globally (Money Matters)
The much anticipated explosive growth of emerging markets will lead to a global re-balancing and shift of influence with significant retail industry impacts. While the middle class is declining in the US, there will be massive growth of the middle class in emerging economies, like China, where consumers will now have money to spend that they’ve never had before. Emerging markets pose an appetite for Western quality goods, thus demand will be fueled by both desire and new access to money. For US retailers dealing with low addressable population growth, they will be more focused on international growth. With that comes the need to have a clear understanding that different rules and cultural nuances require a more customized retail model to address local realities like Mom and Pop shop competition and culturally entrenched direct-to-consumer models. US retailers are already looking at different models to gain foothold in new markets, such as electronic models or strategic alliances like the one forged between Costco and Alibaba to sell Kirkland Signature in China. “In a fragmented retail world, future retail success is based on creating high value, high impact experiences for core consumers,” said Virginia Morris, Vice President, Global Consumer & Innovation Strategy, Daymon Worldwide. “It’s all about keeping your loyal shoppers coming back to you versus the competition, and inspiring them to spend more when they do.”
About Daymon Worldwide
Daymon Worldwide is the global leader in consumables retailing. Through our renowned industry expertise in Private Brand building, experiential consumer marketing and innovative retail-driven services, we currently collaborate with more than 100 major retailers and nearly 6,000 manufacturers in 50 countries. Daymon teams work directly with the world’s leading suppliers and retailers to create and market ownable, differentiated brands in the marketplace that deliver exceptional value, drive consumer loyalty and profitable sales growth, and improve people’s lives. We currently handle more than 1,700 brands and approximately 165,000 individual SKUs globally. Founded in 1970, today Daymon has more than 39,500 highly trained and passionate associates worldwide, with offices located across six continents. For more information, please visit www.daymon.com.