Study: Personal data, digital currency among retail trends for 2014
San Francisco — Retail in the coming year will be more streamlined and integrated with online experiences, according to predictions from POS software provider Revel Systems.
In 2014, Revel Systems predicts the following industry advancements will begin to take shape:
POS will integrate with personal data trackers such as Fuelband, Fitbit and Up. These devices will communicate with POS systems during order times to download how many calories consumers consume, and recommend meal and menu items based on their daily caloric intake goals.
Mobile and digital currency will go mainstream in retail. Mobile payment options will bridge people’s online wallets with their physical ones at the checkout. People will be able to tap into digital currencies like Paypal Google Wallet and Bitcoin to pay for items at the checkout line.
CRM Technologies will become “smart” and predictive. By using smart peripherals such as facial recognition software, a retailer’s menu boards and POS displays can use predictive modeling based on past order history to recommend items for cross-sell and upsell opportunities.
Social capital begins to influence personal pricing at brick-and-mortar. CRM systems will also include social data so that more influential people over Twitter and Facebook can receive perks based on their digital footprint and if they help publicize a business through checking-in or uploading product or establishment photos. Offline and online experiences merge.
Order ahead features become the norm. Online and mobile ordering are standard but with order-ahead functionality, people no longer have to wait in line to make a purchase. This changes the nature of how retailers interact with consumers in restaurants, leading to more streamlined and intuitive ordering experience.
Gamification will be offered in POS systems. With the popularity of gamification technologies like Yelp and Foursquare, POS systems will begin to offer incentives like achievement badges and virtual rewards for both establishment owners and customers.
“This year the retail industry will see major shifts take place, whether it is the convergence of online e-commerce with brick-and-mortar retail, the rise of digital currency like PayPal and Bitcoin at the checkout, or the integration of wearable data to help consumers make smarter choices at the checkout,” said Lisa Falzone, CEO and founder of Revel Systems. “We are at the forefront of breakthrough technologies and believe the industry is headed towards a more integrated and user-friendly approach to retail.”
Four Forces That Will Propel Retail Investment Sales in 2014
The recession took a major toll on the retail real estate sector but, despite waffling consumer confidence, the sector continues to improve. Retail now accounts for 19% of total U.S. investment volume year-to-date 2013.
Retail experts from Jones Lang LaSalle predict four key forces that will drive an increase in the retail transaction market during 2014:
1. Strengthening Fundamentals
“Total retail investment is expected to increase upwards of 20% in 2014, as pent up demand that was not satisfied in 2013 fuels investments and investors look to balance their portfolios. Driven by strengthening fundamentals, the retail market will continue to turn around despite store closings and consolidation. Vacancy rates are projected to inch downward driven by power center popularity while rents are expected to increase albeit slightly for the fourth straight quarter. We expect gains to become more widespread across markets in the coming year.” — Greg Maloney, president and CEO, Jones Lang LaSalle Retail
2. Retail Portfolios to Hit the Market
"The number of portfolios coming to market, which combine a broad spectrum of B and C retail assets, is expected to increase as REITs continue to dispose of assets in the year ahead. As sellers look to maximize the cycle and their proceeds, putting product on the market in bulk will take advantage of economies of scale; while acquiring small portfolios will allow buyers to immediately expand their footprint in a region. We expect these small portfolio sales to pique the interest of investors looking to deploy capital into value-add assets, with private equity remaining an active buyer in the segment. Institutional investors will still be aggressively looking for single core retail assets around the country.” — Kris Cooper, managing director, capital aarkets, Jones Lang LaSalle
3. Liquidity in the Debt Markets:
“Lenders will continue to seek retail opportunities in 2014 to diversify their allocation of funds. We expect investors to take advantage of the liquidity in the capital markets for retail product and readily available debt to facilitate new acquisitions and refinancings that will ultimately increase leveraged returns. Right now it’s primetime for long-term holders of core and stabilized retail assets to secure fixed-rate financing and lock in today’s historically low rates. Borrowers will continue to take advantage of floating-rate debt for redevelopment of transitional assets in core to secondary plus locations.” — Jimmy Board, executive VP, real estate Investment banking, Jones Lang LaSalle
4. Improvements Pay Dividends
“Improved operating performance and consumer demand for physical points of sale are pushing retail owners to invest into existing assets, giving properties a long-overdue makeover. Investors that execute stalled expansions and renovations can profit tremendously from the market’s upswing and ability to re-tenant vacant space. The much-needed injection of capital will benefit investors who plan to go to market before 2020 with updated product, as they’ll capitalize on the constricted new development pipeline, increased property values and stabilized rent rolls.” — Kristin Mueller, COO, Jones Lang LaSalle Retail
Amazon makes 2.5 million-plus price changes on a daily basis
New York — Amazon.com made more than 2.5 million price changes a day throughout November, according to price intelligence firm Profitero. By comparison, in November, Best Buy implemented a total of 52,956 price changes every day and Walmart a total of 54,633 price changes.
Profitero’s analysis revealed that Amazon.com has increased its number of daily price changes 10-fold during the last 12 months. At the beginning of December 2012, the online retailer implemented just 269,113 price changes.
The extent of Amazon.com’s daily price changes is even more significant when compared with the number of daily price changes implemented by brick-and-mortar retailers Walmart and Best Buy. During November, Best Buy made a total of 52,956 price changes and Walmart a total of 54,633 price changes, highlighting the massive price advantage Amazon has over other retailers — and demonstrating why retailers need to monitor their online competitors’ prices every day to remain competitive on the market and avoid losing sales.
“It’s staggering that Amazon.com is making millions of price changes on a daily basis,” said Volodymyr Pigrukh, CEO and co-founder of Profitero. “The sheer scale of these price changes demonstrates why brick-and-mortar retailers need to be using an advanced online price intelligence solution if they want to compete with Amazon.”
Profitero predicts that the number of price changes is only going to increase as the retail landscape becomes more competitive, and so it’s impossible for any retailer to monitor this number of price changes manually.
“To understand where they stand against their competitors’ prices and avoid losing out on sales, retailers need to monitor Amazon’s prices on a daily basis,” Pigrukh said.