Posted by: Jonathan Bayfield
Retail Research & Consulting
Jones Lang LaSalle EMEA Research
Three months after joining Jones Lang LaSalle as a graduate in the Retail Research team – I thought I should have a look into where I think the current retail market is and peer into its future.
The shopping centre or high street of yesterday is a thing of the past. Customers, myself very much included, are searching for a multi-channel combination of accessibility and, more importantly, experience. This new type of consumer is demanding more from the retailer than ever before. I want to have freedom to shop when, how and wherever I want. Whenever I look to buy in store, I will have looked online and vice versa. In fact, often I’ll be browsing my phone, sending my friend’s pictures of what I am trying on and they’ll be sending me information about what else is out there. Radical structural change is taking shape, which the real estate industry must adapt to. This video of London’s new Burberry store showcases the store of the future, the merger of the high street with e-commerce.
‘Experience’ focused stores, which marry elements of e-commerce (such as Burberry’s) in super-prime locations, such as London’s Regent Street, are the growing trend for international retailers, as our team has detailed in the recent Destination Europe 2013 report.
Retail’s future is clearly going to have an ever increasing engagement with the internet. As a big fan of my iPhone, I am not surprised to note in this BCSC report, that 25% of total UK sales are expected to be driven by m-commerce (mobile) by 2020.
As shoppers increasingly become visitors of retail space, the shop experience becomes more crucial for brand engagement as new consumers can shop on the move anytime and anywhere. London’s Niketown, in the prime location of Oxford Circus, has been a leader of this engagement for a number of years. Much to my family’s frustration, I would love to kick a football around on day trips to London and watch the latest extended edition adverts in store, never buying anything there and then.
The latest type of commerce predicted to start making more and more powerful waves in the sector, is s-commerce. This is essentially the effective use of (online) social networks to promote and sell good. Retail Specialists, Conlumino, have analysed s-commerce’s likely growth and claim that over the next five years, the value in the UK will rise from £1.6 billion today to around £3.3 billion. Retailers using sites such as Facebook, Four Square and Twitter to drive sales and footfall to stores are likely to be ahead of the market, for a consumer like me at least.