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Tech Guest Viewpoint: Top Four Retail Tech Predictions for 2016

BY Rob Gonzalez

2015 has been a good year for e-commerce. Alibaba shattered records on Singles Day with $14.3 billion in sales. India witnessed a boom in e-commerce investment from companies looking to win the millions of new smartphone users. Even the Girl Scouts joined the digital mix, rolling out version 2.0 of their Digital Cookie program to boost their online cookie sales.

We expect even bigger things from 2016. The stage is set for a shift in the way brands and retailers relate to one another, and to consumers. We are developing technology to support that shift toward collaboration, and with recent market research from interviews with 200 leaders in e-commerce from major consumer brands, we have several predictions for what e-commerce will look like in the coming year.

2016 will be the year of collaboration for brands and retailers.
According to a study by comScore and UPS, 73% of consumers reported that detailed product information is the single most important factor in the search and selection process when buying online. Retailers know that content drives commerce, so they are demanding an increasing amount of content from brands.

Yet according to our market research, 62% of brands think retailer requests for content are unreasonable. Without brand support for retailer initiatives, you can forget about sales. Brands and retailers will realize in 2016 that collaboration is the only way to understand shifting consumer shopping behavior, create and optimize great content for omnichannel, and respond with one excellent shopping experience.

E-commerce departments will be broken off as standalone organizations.
Digital marketers will embrace e-commerce initiatives as core responsibilities in 2016, according to Forrester. Brands will launch their e-commerce departments as standalone organizations to concentrate expertise and maximize the success of new channel sales. E-commerce strategy at the brand level will make brands much better equipped to be true merchandising partners for retailers, making them better at optimizing content and more responsive to e-commerce demands.

Head of Digital Business will be the hottest new job in B2B2C.
Only 25% of brands surveyed believe their organizations are ready to adapt to future shopping channels and only 29% of brands agreed they know how to capitalize on the growing e-commerce and mobile commerce markets. Organizations will need to appoint a head of digital business to understand, respond to and predict shifts in consumer shopping behavior across mobile, social and other new channels.

Brands will launch their own marketplaces.
By 2030, 30% of all purchases will be made through an online community, according to IDC Research. Starting in 2016, brands across all categories will begin launching their own marketplaces to make it easier for consumers to find their products across retailers. For the past decade or so, direct-to-consumer was uncharted territory for brands, and a new and scary game to play.

Today, led by LEGO and other success stories, brands are rising to the challenge. Thankfully for retailers, direct-to-consumer is not a zero sum game. If a brand does a good job selling direct, retailers that carry that brand will likely sell more as well.

BONUS PREDICTION: Amazon drone armies will become self-aware.
Amazon captured 36% of all online sales on Cyber Monday and is amassing drone armies. Sounds like something out of Terminator 2, but Amazon drones are poised to become self-aware, e-commerce driving machines that will decide what you want and just deliver it. Their parting line will always be: “We’ll be back.”

We venture to say 2016 will be a great year for e-commerce. As you make your 2016 plans, prioritize collaboration, optimizing content for new channels and recruiting an e-commerce superstar; but don’t forget to enjoy the holidays. And say hello to your friendly neighborhood Amazon drone.



Rob Gonzalez is the co-founder and VP of business development at Salsify.

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I.Vukovic says:
Dec-22-2015 11:16 am

Great article indeed! Many noteworthy moments emphasized year of 2015 and and many more are expected to land in 2016. Bond between brand and retailer needs to be more coherent so to attain better sales and customer acquisition. I think that in 2016 we'll see retailers find new ways to get rich content (e.g. product videos) from brands and bring this to their pages, so as to faciliate online shopping for consumers. Tech intermediary solutions that deliver brand content to retailers will be big in 2016.

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Toys ‘R’ Us is focused on ‘flawless’ as it goes into holiday home stretch

BY Mike Troy

With the financial picture improving modestly at Toys “R” Us, CEO David Brandon said the company is ready to build on third quarter successes during the final days of the holiday season.

Total sales at Toys “R” Us were not impressive during the third quarter ended Oct. 31, but some of the weakness can be explained by the strong dollar and unfavorable trends in electronics categories. More noteworthy was the improving profitability picture at a company where new CEO Brandon is experiencing his first Christmas at the helm of the toy retailer and looking to execute a strategy launched in 2014 called “Fit for Growth.”

Since the inception of the strategy, the company has realized expense saving of $248 million and that showed up in third quarter operating results where the company reported a $31 million adjusted profit versus a prior year profit of $3 million. On a reported basis the company said its net loss was $167 million compared to a prior year loss of $213 million.

Sales growth proved challenging, with net sales declining by $128 million to $2.3 billion, but were essentially flat excluding the effect of currency exchange. Total same-store sales increased 0.6%, due to 2.9% international comp growth offset by a 0.9% comp decline at U.S. stores.

“Our third quarter results demonstrate the continued progress we are making to position the company for growth,” Brandon said. “As we enter the final ten days of the holiday selling period, we are focused on the flawless execution of our plan to ensure customers have an enjoyable shopping experience and find the hottest toys in-stock, no matter how they choose to shop with us.”

Toys “R” Us operates 865 stores under the banners of Toys “R” Us and Babies “R” Us in the United States, Puerto Rico and Guam, and in more than 750 international stores and over 250 licensed stores in 38 foreign countries and jurisdictions.

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Queen of mail-order catalogs dies at 88

BY Marianne Wilson

Lillian Vernon, who grew a home business selling monogrammed pocketbooks and belts, into one of America's best-known mail-order businesses, died on Monday. She was 88.

Vernon and her family came to the United States in 1937 as Jewish immigrants from Germany fleeing Hitler. She was newly married and pregnant with her first child when she started her business in 1951.

The Lillian Vernon Corp. was the first company owned by a woman to be listed on the American Stock Exchange, in 1987, according to the New York Times.

Among other innovations, Vernon is credited with being the first to create gift catalogs dedicated to Easter and Halloween. To read more, click here.

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