What will retail look like in 2020? Practicology's CEO Martin Newman walked delegates at the Shopping Today conference through some of the likely changes. Presented on the 26th September 2013 in The Netherlands.

1. Be inspired: Predictions for the
evolution and revolution in B2C
channels in the next decade
Martin Newman – CEO Practicology

2. Why I‟m speaking today…

3. • I‟ve worked in multichannel retail for 25 years -
for businesses such as Harrods, Ted Baker and
Burberry – and had responsibility for stores,
online, kiosks, DM and call centre channels
• I now run Practicology a multichannel
consultancy based in London & Sydney serving
international clients
• I‟m on the Advisory Board to etailer Wiggle,
and am the Digital & Multichannel Retail
Advisor to the charity Breast Cancer Care
• This year I was included in the British
Interactive Media Association‟s Digital Hall of
Fame Hot 100

4. Do I have all the answers? No.
If I did, I‟d be sitting on this boat!

5. A shameless plug…

6. Deep experience of the team:
We’ve all been at the coal face!

7. We‟re all retailers:
We‟ve owned the eCommerce P&L for the following brands:

8. What Practicology does
Strategy
Development
Commercial
Planning
Technology
Selection
Organisational
Change
Analytics & BI
Conversion
Rate
Optimisation
Customer
Insight
UX & Usability
Site Design
Digital
Marketing
Trading
Services

9. Who we do it for

10. You can‟t afford to be only thinking about
today and next year…

11. You really can’t afford to take
your eye off the ball…as things are
changing so quickly

13. The customers of 2020… today

14. Two concepts that will be crucial to
any business that engages with
consumers in 2020…

15. Businesses in 2020
• Anything, Anytime, Anywhere
• If you were a customer service
business that just happened to sell…
…how would you treat customers?

16. Prediction 1 – Web penetration
What % of your sales or interactions with
customers do you expect to take place on the
web by 2020?
• Non-grocery retail – 50%?
• Grocery retail – 20%?
• Travel/tickets – 80%?
• Retail banking – 80%?
• It‟s hard to predict exact numbers but we all
know we are yet to reach saturation point

17. Don‟t think the web is only for the young

18. Prediction 1 – Web penetration
Web shopper 1996 Web shopper 2020

19. The majority of older customers are buying online and we‟re
seeing this with an ever-increasing % of orders online

20. Prediction 1 – Web penetration
• 93% Internet
usage
• 50% mobile web
• Forrester estimates
6% retail sales
were online in
2012
• If it hits 10% by
2020 that‟s the
same as the UK
figure today

21. Prediction 1 – Web penetration
• No product category is
immune from this
evolution
(Figures from PwC Multichannel
Myths report Dec 2012)

22. Prediction 2 - Multichannel
• Multichannel shopping behaviour means the web
will be the driver of most purchase decisions by
2020 – even if the transaction is not completed
online and/or delivered
• Supermarket Albert Heijn collection point for cars
and a service point for Bol.com in an Albert Heijn
store

23. Prediction 2 – Multichannel
By 2020 many more businesses will have moved to the top right
Click and collect

24. Prediction 2 - Multichannel

25. Prediction 2 - Multichannel
• A single view of the customer
is crucial so you can serve
them across multiple channels
• Businesses will be increasingly
channel-agnostic
• Allowing customers to start
and finish journeys in the
channel of their choice

26. Prediction 3 - International
• Consumers will be
global and 24X7
• Whether your offer is
competitive will depend
on offering local sites,
ranges and customer
service
• At the same time your
competition will no
longer be purely local

27. Say hello to the Chinese…

28. • Chinese etailer Light In The Box sold $200 million to
17 countries in 2012 – half to European consumers
• In June 2013 it raised $79 million in a US stock
offering – businesses like this are gaining credentials
consumers will trust

29. Prediction 3 - International
• Consumers in developed markets are beginning
to transact with online retailers in developing
markets
• PayPal says 16% of all online shopping in the
UK, USA, Australia, Germany, Brazil and China
is cross-border, and worth $105 billion in 2013
• PayPal predicts that by 2018 there will be 130
million cross-border shoppers spending over
$300 billion

30. Prediction 3 - International
• Emerging market
businesses will begin to
open stores in Europe
• And could buy up European
brands too
• Chinese fashion retailer
Bosideng opened a store in
Central London
• Global brands also attract
global tourist spend – do
you accept China UnionPay
in store?

31. Prediction 4 - Mobile
• Your customers will use mobile as part of a
large percentage of their shopping journeys
• They will make purchases not just on tablets
but on smartphones and hybrid devices too
• Biometric technology will likely do away with
the need to input payment details
• The majority of web sales will be on
mobile (tablets and smartphones)
• Mobile - revolution not evolution

32. Prediction 4 - Mobile
• Most adults will own a smartphone (43% now)
and all will use it to access the internet
everyday in the Netherlands (now 64%)
• In the UK, already 23% of online sales are on
mobile devices, up from 11.6% a year ago and
34% of site visits are from mobile devices, up
from 21% a year ago, says IMRG

33. Prediction 4 - Mobile
Sites will be built with
responsive design principles as
a matter of course by 2020

34. Prediction 5 – Consumer behaviour
• Multitasking/multiscreen – mobile shopping
while commuting, watching TV while banking
on a tablet etc: Never really offline
• More loyal to retailers and brands that offer
something unique or added value services
• Less loyal to retailers and brands who don‟t
have a differentiated offer
• And will consider international online
competitors if the only difference to base their
decision on is price

35. Prediction 6 – Consumer expectations
• Consumers will expect to be entertained and
inspired when they come to your stores and
branches – must add value to the transaction
• They will expect etailers and brands to have a
physical presence too – even if it is pop-up – or
a collection/returns point for online
• Consumers will expect marketing, promotions
and interactions to be personalised whatever
the channel
• Tthey will expect you to make good use of the
customer data they likely already provide you
with

36. Prediction 7 – Customer-centricity
• Chief Customer Officer, VP Customer or
Customer Director…
• Every customer-focused organisation will have
a senior member of staff tasked with
championing the customer
• The most forward-thinking businesses will have
taken this concept further and embedded a
culture where all staff champion the customer
• What will this mean for the way businesses
treat their customers…?

37. Prediction 7 – Customer-centricity
• Bad customer feedback
via social media and
other channels will be a
core KPI
• If a product or service
you sell gets consistently
poor feedback it will
quickly be removed from
sale or re-engineered
• Consumers will also
inform product and
service development

38. Prediction 7 – Customer-centricity
• Quality is already important to consumers in the Netherlands
• Price is important to consumers everywhere. Convenience is
the third crucial factor
• You will allow customers to get their hands on their purchases
when it suits them, not you

39. Prediction 7 – Customer-centricity
Personalisation will
be more important.
Products
• Marketing –
timing and
channel as well as
actual content
• Offers and
discounts – based
on location and
other triggers

40. Prediction 8 – Company structures
• Which executive job roles will be crucial to a
successful business in 2020 apart from the
Chief Customer Officer?
• Ecommerce will become commerce
• Marketing, IT, Ecommerce, Buying &
Merchandising roles will all begin to merge
• A need to harness data will see staff with
analysis and actionable insight skills in demand
• The CEOs of 2020 are the Multichannel,
Ecommerce and Digital Directors of today

41. Prediction 9 – Town centres
• It‟s not as bleak as it may first look…
The UK’s top click and collect performers:
32% of Argos’ total sales are through Reserve & Collect proving the appeal
of multichannel shopping journeys
90% of Halfords’ online sales are through Click & Collect

42. Prediction 9 – Town centres

43. • Digital brands will adopt more pop-up strategies that invite
exploration
• EBay, for example, opened a pop-up store in London‟s
Covent Garden for a weekend in the run-up to Christmas
when online orders traditionally peak
• Retailers will develop 24-hour, self-service collection lockers
in high-traffic locations
• In Australia, supermarket chain Coles is trying out
refrigerated lockers where online shoppers can retrieve their
order by way of a pin number. Waitrose is doing similar in
the UK
• Play and storytelling will be a stronger means to educate
and entertain shoppers
• adidas NEO stores in Germany bring social media into the
store with elements such as „Share Your Look‟ mirrors

44. • The blurring of daily routines and the squeeze on free
time will continue to heighten the appeal of vending
machines offering much more than just snacks…
• In the US Best Buy has used vending machines for
electronics such as iPods in airports to serve customers
day and night
• Innovative retailers and local authorities will help the
high street regain its role as a community space where
people are encouraged to meet and socialise
• KitKat in Holland has offered shoppers a moment of
downtime with its tongue-in-cheek offer of „No Wi-Fi
Zones‟. Mobile signals are jammed in the seating area
allowing people to socialise and relax. Similarly,
Selfridges has created a Silence Room where people
can go to unwind

45. Prediction 9 – Town centres
• Three years ago
Kiddicare was an online
retailer with one
showroom at its DC
• It‟s begun to open
“destination” stores that
give online shoppers
reasons to visit – cafes,
antenatal and baby
classes etc – and shows
what stores need to
offer in order to
compete with online

46. Prediction 10 – Marketplaces go
multichannel
How long until Amazon has an offline presence?

47. 2020 is not about…

48. Thank You!
Please email me at:
Martin@Practicology.com
Or follow us on Twitter at:
@MartinNewman
@Practicology