The Future of Retail

Editor's Notes

1. Thank you for inviting me here today to speak at the, Retail Asia Leadership Forum. Tonight we will have the 2014 Asia Retail Awards . For 30 years now I have been working in the Marketing , Retail & more recently the internet space..... I can tell you a secret ...............you already know this one ...... Asia is where it is really happening.
2. Retail, or consumer facing businesses, are about 25% of the world GDP....and growing. Look at the figures on the screen. This year $19.7 trillion. As wealth increases and the middle class grows, we buy more.
3. E-retail growth is slowing but it will continue to grow relative to traditional retail.
4. Asia is where the growth is, Asia is 42/43% of the world retail market, But number 1 choice to open new retail outlets is Germany? China is 5th on the wish list.
5. Biggest as expected is Walmart, but Amazon has forecasted at sales of $90.9 BL this year which would take it to 6th largest retailer overall. Walmart online for 2014 will be 10 bl plus. Retailers as you know are now all singing the multi channel, multi format song, the top 2 on this list are trying to be strong in E, Tesco is the largest e-retailer in Europe. But the most interesting in the list at the moment are 6 & 11. LINKS: Walmart - http://www.walmart.com/ tesco - http://www.tesco.com/ Carrefour - http://www.carrefour.com/ Costco - http://www.costco.com/ Kroger - https://www.kroger.com/ Aldi - https://www.aldi.us/ Home Depot - http://www.homedepot.com/ Metro Group - http://www.metrogroup.de/internet/site/metrogroup/node/METROGROUP_INTERNET_HOME/Len/index.html Target - http://www.target.com/ Walgreens - http://www.walgreens.com/ Lidl - http://www.lidl.co.uk/en/index.htm
6. Aldi in 2013, grew at 36%, Lidl at 17.4%. This growth is coming from being clever. There private label is of the highest quality, better than anything else, real value for money and what are consumers looking for worldwide? Value for money. But also with very limited SKUs of 2,500 & 6000 they do fulfill most needs, fresh is now exceptional. http://www.thisismoney.co.uk/money/markets/article-2692087/CITY-FOCUS-How-big-grocers-tough-time-Mail-mans-exclusive-look-Aldi-UK.html http://simple.wikipedia.org/wiki/Aldi http://www.theguardian.com/business/2014/sep/29/aldi-vows-to-fight-on-in-supermarket-price-war-as-uk-profits-leap-65 http://www.thisismoney.co.uk/money/markets/article-2735948/German-grocer-Lidl-plans-open-hundreds-UK-stores.html http://www.independent.ie/business/irish/aldi-and-lidl-increase-share-of-irish-grocery-market-30183741.html http://uk.kantar.com/consumer/shoppers/2014/2309-kantar-worldpanel-uk-grocery-share-data-september/ http://uk.reuters.com/article/2014/04/08/uk-britain-retail-idUKBREA370VQ20140408 http://www.bakeryinfo.co.uk/news/fullstory.php/aid/12253/Aldi_and_Lidl_show_continued_sales_growth.html
7. Aldi in 2013, grew at 36%, Lidl at 17.4%. This growth is coming from being clever. There private label is of the highest quality, better than anything else, real value for money and what are consumers looking for worldwide? Value for money. But also with very limited SKUs of 2,500 & 6000 they do fulfill most needs, fresh is now exceptional. http://www.thisismoney.co.uk/money/markets/article-2692087/CITY-FOCUS-How-big-grocers-tough-time-Mail-mans-exclusive-look-Aldi-UK.html http://simple.wikipedia.org/wiki/Aldi http://www.theguardian.com/business/2014/sep/29/aldi-vows-to-fight-on-in-supermarket-price-war-as-uk-profits-leap-65 http://www.thisismoney.co.uk/money/markets/article-2735948/German-grocer-Lidl-plans-open-hundreds-UK-stores.html http://www.independent.ie/business/irish/aldi-and-lidl-increase-share-of-irish-grocery-market-30183741.html http://uk.kantar.com/consumer/shoppers/2014/2309-kantar-worldpanel-uk-grocery-share-data-september/ http://uk.reuters.com/article/2014/04/08/uk-britain-retail-idUKBREA370VQ20140408 http://www.bakeryinfo.co.uk/news/fullstory.php/aid/12253/Aldi_and_Lidl_show_continued_sales_growth.html
8. In Asia japan leads the way on sales, with China at number 7. LINKS: 7 Eleven Japan - http://www.sej.co.jp/ Aeon Group - https://www.aeon.info/en/ Yamada Denki - http://www.yamada-denki.jp/company_e/index.html Lawson Inc. - http://lawson.jp/en/ Seven And I Holdings - http://www.7andi.com/en/ Family Mart - http://www.family.co.jp/english/ Sun Art Retail Group - http://www.sunartretail.com/html/index.php China Resources Enterprise - http://www.cre.com.hk/index.asp Suning Appliance - http://www.suning.com/ UNY Group Holdings - http://www.unygroup-hds.com/english/
9. 1 billion online in Asia, total world wide we are racing towards 4 billion online, And shopping/retail is going to be changed forever by mobile.
10. Consumers, when they are online, will move from trial, to regular purchase online, or in online/offline combinations
11. Retail spending is growing, but fastest is India, then Indonesia, China, Vietnam
12. Everything can be bought online, at aircraft shopper online I found an Airbus 340-200 (1997) for only $20M, a Bell 212 helicopter (1972) only $2.5M. Anyi Lu Stefania 2 $445. Arion Bag from Hermes only $5,300 Or 15kg of potatoes size 40 for $10.30 (delivery extra over 50 miles)
13. In many categories women are the largest group, spending money, how many creative directors world wide are women? This may be a major issue.
14. Every one is buying from under 20 to over 65.
15. Purchase by mobile devices will soon pass computers in middle east.
16. Click and collect is the short term way forward in many countries. But busy executives are buying groceries online. https://www.youtube.com/watch?v=k2yLmXc5cXY#action=share http://asia.nikkei.com/Business/Companies/Seven-i-to-offer-same-day-pickups-at-convenience-stores Seven I allows customers to order online and pickup in convenience stores expanding distribution networks. LINKS: Walmart - http://www.walmart.com/ Sears - http://www.walmart.com/ Kmart - http://www.kmart.com/ Farm Stores - http://www.farmstores.com/ Chronodrive.com - http://www.chronodrive.com/refonte/prehome/
17. But there is something even better on the way! LINKS:
18. Facebook is working with stripe on the buy button. Philippines has Groupon and Metrodeal, offering customers the ability to buy at discounts LINKS: JC Penney - http://www.jcpenney.com/ Facebook - https://www.facebook.com/ Victoria Secret website - https://www.victoriassecret.com/ Victoria Secret's Facebook - https://www.facebook.com/victoriassecret Ruelala - https://www.ruelala.com/auth/login/ OneKingsLane - https://www.onekingslane.com/ Groupon - http://www.groupon.com/ Dealnews - http://dealnews.com/ ConsumerSearch - http://www.consumersearch.com/ FatWallet - http://www.fatwallet.com/ Brad's Deals - http://www.bradsdeals.com/
19. E-Retail is growing by 20%, new phones, tablets, and phablets are enabled, growth is here for some time, with the sopping experience being made easier daily. Order from your device, pay from your device, track by your device.
20. Potential is everywhere **The Global Retail Development Index™ is an annual study that ranks the top 30 developing countries for retail expansion worldwide. The Index analyzes 25 macroeconomic and retail-specific variables to help retailers devise successful global strategies and to identify developing market investment opportunities. The GRDI is unique because it identifies today's most successful markets and those that offer the most potential for the future.
21. Asia now leads, by 2017 the lead will be significant.
22. In Asia, China is the largest e-retail market. Use of the phone to compare prices is growing, 74% in china 62% in India, 58% here in Singapore
23. 6 out of every $10 spent in Asia comes from China
24. Smart phone growth with be greatest in China, Indonesia will be 4th, Philippines 10th
25. Now what will this smart phone growth mean? Every smart phone can be tracked switched on or off. Modern retailers over the next few years, will track every shopper via in one system enhanced wi-fi transmitters.
26. Therefore with a customer, you can see where they go 100% of the time, see what promotions they interact with. Then assuming they switch phone on and use free Wi-Fi, link to loyalty cards, store cards, discount cards. Plus all social data. This enables a profile to be built, and an offer sent immediately, offers can be discounts, promotions, specials or just information.
27. The analytics linked to this kind of system is immediate,
28. These are results from a real test.
29. Ok I have spent a lot of time on E, but back to bricks and mortar. There is growth in the smaller formats, the mini markets, online still is at early stage, there is a significant increase in promotion activity, but promotions, it must be remembered, are essentially short term, with no real uplift after week 2.
30. So 10 predictions for the next few years
31. There is developing a very detailed opportunity to research customers. But this data needs interpretation and key insights pulled out.
32. Delivery is a key advantage in retail, delivery was normal in the past, it will be again. Consumers have busy lives, they will pay for convenience.
33. As I showed you before, we are now being tracked as never before.
34. Adapt or die .....
35. However balance against this, that we need to create more and more jobs. M to M is driving the intelligent vending machine, the fridge that orders direct to a pre defined pattern, but people may rebel against it. Do you want the best prices or do you want service?
36. Best Buy $20BL is a very good story here, if its not in store, order on the stores web site. (not Amazon’s)
37. If you want to keep everything about you off the wed, use profile1 to check,
38. If it flies, floats or ..........rent it . Rental is a growth area. And people renting out their assets is growing quickly. Air B&B
39. Social feedback, the opinion of your friends has taken over, push is slowing very quickly... celebrity endorsements are still important, but your friends recommendation is the best...
40. Price will still drive 85% of all purchasing decisions, but not just the lowest, value for money, 5% local, & 10% luxury
41. LINKS: Storewars Book - http://www.amazon.com/Store-Wars-Worldwide-Mindspace-Shelfspace/dp/1118374061/ref=sr_1_1?ie=UTF8&qid=1395834656&sr=8-1&keywords=store+wars FMCG Book - http://www.amazon.com/FMCG-Power-Fast-Moving-Consumer-Goods-ebook/dp/B00LQASPH8/ref=sr_1_1?ie=UTF8&qid=1405691404&sr=8-1&keywords=FMCG:+The+Power+of+Fast-Moving+Consumer+Goods E-Retail Book - https://www.storewars.net/products/books/e-retailing-the-world-is-changing,-how-are-we-selling-on-line,-how-it-makes-the-world-different-detail Greg Thain's LinkedIn - https://www.linkedin.com/in/gregthain
42. LINK: M3 Website http://m3media.co/home/#home