General Retail Industry Trends
1. Retail in the US accounts for $2.6 trillion in sales.
(Select USA)
US retail companies operate via a wide array of well-established distribution channels. The sector employs 42 million people in small “mom-and-pop” shops as well as large department stores, and the competitive environment spurs innovation, efficiency, and reliability.
2. US SMB retailers process about 482 transactions per month.
(Vend, 2018 Retail Benchmark Report)
The 2018 Vend’s Retail Benchmarks Report analyzed the sales and revenue data of over 13,000 Vend customers. The analysis of retailers statistics indicate that New Zealand business owners processed more than 500 monthly transactions, while North American ones processed 426. Vend analyzed retailers who mostly owned 1-10 stores. Any way you look at it, that’s a healthy number of transactions.
3. An average SMB’s monthly income amounts to $22,340.
(Vend, 2019 Retail Benchmark Report)
According to Vend’s analysis of the US retail sales statistics, that’s with a gross margin of 50.96%. This incredible figure defies the predicted demise of small retail.
But the numbers differ across industries:
Furniture retailers take the lead with $39,572 per month. Beauty industry retailers follow with $18,644, with special thanks to special circumstances, as people buy lipstick, deodorant, and conditioner more often than they do furniture. After all, beauty is a lifetime addiction.
4. Some of the most profitable retail industries by net margin are building supplies and distribution centers, which frequently see a 5% net margin.
(Investopedia)
According to Investopedia, distribution centers, along with lumber and building supply retailers, are more lucrative than most other types of retail. Different retail trends apply to a 2×4, as it doesn’t age and go out of style the same way as electronics, clothes, and similar products. Usually, these items will not qualify for a discount over time, thus maintaining a higher net margin.
5. 46% of retail participants reported closing establishments in 2018.
(Geoblink)
Nevertheless, 68% still plan to open more establishments in 2019. While the situation on the high street has grown more complex and competitive, this finding proves that the physical store is still a vital sales channel for retailers.
6. 37% retail professionals claim they had to close their establishments due to poor location choice.
(Geoblink)
In the same 2019 Geoblink report on retailing today, 87% of retail professionals stated that a store’s location was a priority to their business. Most, therefore, understand the importance of a suitable store location but fail to deliver, highlighting a strong point of vexation for high street retailers.
7. 75% of consumers don’t necessarily identify quality with high prices.
(KPMG)
If their products lack in quality, pushing up the prices is unlikely to help retailers cheat their way into people’s wallets. A rise in alternative brand popularity suggests a lower price point, an original idea, and a unique selling point can often beat established competitors. Perhaps unexpectedly, consumer statistics indicate that bragging about one’s retail street-smarts after getting a particularly good deal for a quality item has become a trend in itself.
While pricy brands are still effective status symbols, they seem to be going out of style at a faster pace than one could imagine. Consumers are becoming increasingly educated on pricing strategies and often do extensive product research before committing to a purchase. Many are now prioritizing value.
8. Over 78% of consumers would choose to spend money on an experience or an event.
(Retail Trends 2019, Report)
The 2019 KPMG Retail Report sheds light on new retail marketing trends – live experiences. These sensory-central events usually exert a substantial impact on customers, helping them get in physical contact with the product/service and have a good time while they’re at it.
KPMG is a network of professional service firms that employs 207,050 people in three lines of services: financial audit, tax, and advisory. Their 2019 study confirms a global surge in experiential retail (alternative experiences in a physical retail environment, including live music, virtual reality, cafés and lounges, and even interactive art).
9. 59% of consumers would meet with an associate if possible; for jewelry shoppers, the number rises to as many as 83%.
(Vend)
Gary Ambrosino, CEO of TimeTrade, commented on these retail industry data. “Consumers’ increasing demand for concierge-like services is forcing retailers to improve the connection between digital and physical and put a greater focus on enhancing the in-store experience…”
He added that omnichannel will largely shape consumers’ future retail experiences. Also, retailers will have to change the way they do business to appease the digitally savvy, and increasingly informed shopper.
10. 62% of customers expect personalized discounts or offers based on past purchases.
(Salesforce)
Recent retail consumer trends indicate that staying competitive isn’t always about employing the flashiest, state-of-the-art data analysis methods and customer-pleasing hacks. Consumers have been far too pampered for far too long. They now expect retailers to go out of their way to make recommendations and record users’ behavior. While personalized recommendations might seem like additional effort to some, they have now become standard practice.
11. Compared to total US consumer spending, the consumer spending share on live experiences and events has increased by 70% since 1987.
(Retail Trends 2019, Report)
In a growing effort to enjoy their lifestyle, people are cherishing and prioritizing experiences over material possessions. Recent retail industry analysis shows a burgeoning need in consumers to satiate their immediate needs. They spend less on buying things and more on doing things – and sharing what they do on social media. From theaters to bars to stores, businesses are doing their best to adapt to this shift.
12. 69% of consumers believe attending live experiences helps them connect better with the brand, their friends, and their community.
(Retail Trends 2019, Report)
In an excellent example of a live experiential take on retail experience as a new retail marketing style, IKEA hosted a sleepover for over 100 customers in one of their shops. The event included a sleep expert who provided advice on how to get a good night’s sleep and what type of mattress would best suit customers’ sleeping style.
13. 77% of consumers, including 60% of Millennials, have fostered relationships with specific brands for over 10 years.
(In Moment)
InMoment’s 2018 US Retail CX Trends Report explored the way brand loyalty affects customers’ willingness to share their data and purchasing experiences. Most of their retail statistics come from satisfied customers. The happier people are with a product/service, the more likely they are to share their feelings with others, including friends and family.
14. Millennials claim they spend 52% of their holiday budget on experience-related purchases compared to 39% of older consumers.
(Retail Trends 2019, Report)
The holiday season is yet another proof that experiential retail, or retailtainment, is the future. The long-awaited and longer-announced decline of brick-and-mortar stores never took into account the overwhelming hedonism prevalent nowadays. And retail industry data shows the desire for experiences has been on the rise for a while now.
15. 52% of people regularly take pictures of their meals.
(Retail Trends 2019, Report)
Happiness is only real when shared, right? As the 2019 KPMG report shows, as many as 11% of respondents take at least one picture of their food per week, while 9% are unable to go a day without capturing what they’re consuming.
This behavior has triggered an avalanche of highly aesthetic retail market trends – arranging food, lighting, and store interior to appear Instagram-friendly. Appealing to buyers’ vanity and making them look happy and well-off on social media also brings free advertising and word-of-mouth recommendations. This way, consumers’ friends and family are likely to see retailers’ service in the best possible light.
16. In the UK, supermarket plastic bag usage has fallen by 86% in 2018.
(Independent)
More and more retailers are working towards replacing plastic bags with paper variants. This helps build up brand reputation and, most of all, it helps customers feel good about themselves.
Recent retail industry data shows “fighting for the right cause” and advocating for positive change on a global scale can benefit a brand’s marketing efforts a great deal. Luckily for our planet, the imposed altruism coincides with higher profits.
Another plastic reduction measure is the 5p charge per plastic bag in England, which slashed plastic bag usage by 86%. Seven major retailers issued 7.6 billion single-use bags in 2014, but that figure was down to just over a billion in 2017-18, estimates suggest.
17. Retail and food services in the US accounted for $513 billion in November 2018.
(Census.gov)
In 2018, food retail industry sales were up by 4%, with the expected surge near the end of the year, on the eve of the holiday season. A robust economy, optimistic attitude towards the future, and strong unemployment figures added to the overall positive numbers.
18. The most useful kind of data retailers used to evaluate point of sale performance was internal sales data (79%).
(Geoblink)
The next most helpful items on the Geoblink’s list were In-store shopper behavioral data (65%) and customer data such as addresses and loyalty card information (55%). This shows how retailers have started using collected and analyzed customer data to influence the tactical implementation of their business strategies.
19. 73% of consumers use multiple channels to shop.
(Harvard Business Review)
Hardly any retail industry company can afford not to run their business on multiple channels. A Study of 46,000 Shoppers demonstrates that omnichannel retailing works. The broad array of capabilities drives the engagement of core shoppers with the retail brand and ultimately draws them to the physical store.
Traditional retailers with physical stores will do better by leveraging the power of online marketing. Synchronizing the physical and the digital worlds will provide their shoppers with a seamless, multi-channel experience that online counterparts still cannot match.