Retail Predictions - Security Tags

A bumper retail year ahead, NRF predicts

Kyle Hall — Thu, 11 Mar 2021 23:04:15 +0000

The National Retail Federation has released its retail sales predictions for 2021 and, based on the results of last year combined with a vaccine rollout, it’s more optimistic than expected.

In 2021, the NRF anticipates retail sales will grow between 6.5 percent and 8.2 percent to more than $4.33 trillion as more individuals get vaccinated and the economy reopens.

So, let’s recap their findings and look to the year ahead.

The tally for 2020

Despite a year tarnished by political upheaval and a deadly global pandemic, early results show retail sales in 2020 performed better than expected.

The NRF notes throughout the year retail sales grew 6.7 percent in 2019 to $4.06 trillion, nearly doubling the NRF’s forecast of at least 3.5 per cent growth.

They explain their initial prediction did not account for the impact of a global pandemic and the figure was well beyond the 3.9 percent growth enjoyed in 2019.

“Online and other non-store sales, which are included in the total figure, skyrocketed to 21.9 percent at $969.4 billion as consumers shifted to e-commerce,” they continued.

It’s important to note these numbers exclude automobile dealers, gasoline stations and restaurants, the latter of which were hit particularly hard last year due to shutdowns across the country.

The holiday sales surge

Meanwhile, it was the holiday period that accounted for much of the retail sector’s sales surge.

“The 2020 November-December holiday season accounted for nearly one-fifth (19.4 percent) of overall annual retail sales,” the NRF remarked.

“Retail sales during this period grew an unexpectedly high 8 percent to $787.1 billion. Non-store and other online sales represented $206.9 billion of total holiday sales, up 22.6 percent over the year before.”

The forecast for 2021

With a better-than-expected 2020 under its belt, the NRF says retail sales are predicted to continue to surge in 2021.

Due to the vaccine rollout and increased consumer confidence, the NRF currently predicts:

retail sales will total between $4.33 trillion and $4.4 trillion.
Online sales, which are included in the total, are expected to grow between 18 percent and 23 percent to between $1.14 trillion and $1.19 trillion.

Increased employment is also tipped to contribute to the predicted surge, with the NRF expecting the overall economy will gain between 220,000 and 300,000 jobs per month in 2021, depending on the pace of the overall economy in the second and third quarters.

“Despite the economy’s stalled momentum at the end of last year, NRF forecasts real GDP growth between 4.5 percent and 5.0 percent,” they noted.

Optimism and relief

NRF President and CEO Matthew Shay welcomed the positive forecast, noting a range of factors contributed to the expected retail growth.

“Despite the continuing health and economic challenges COVID-19 presents, we are very optimistic that healthy consumer fundamentals, pent-up demand and widespread distribution of the vaccine will generate increased economic growth, retail sales and consumer spending,” Mr Shay said.

“From the outset of the pandemic, retailers have gone above and beyond even the most conservative safety guidelines to protect and serve their associates and consumers alike.

“Retailers are increasingly engaged in working with federal, state and local health officials to distribute and administer the vaccine. This partnership has been key to our economic health throughout the pandemic and will continue this year.”

Meanwhile, NRF Chief Economist Jack Kleinhenz said the vaccine rollout could see the economy accelerate at the fastest rate in more than 20 years.

“Our principal assumption is that the vaccination will be effective and permits accelerated growth during the mid-year. The economy is expected to see its fastest growth in over two decades.”

Mr Kleinhenz further noted this year marks the second year of savings, record-high stock valuations, increased home prices, enhanced government support and record low-interest rates, which are all contributing factors towards the economy and consumer spending behavior.

For more information on the retail trends of 2021, see here, or view our range of security tags and labels to secure your store in advance of the expected surge here.

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2019 a year of retail transition, predicts Deloitte

Kyle Hall — Wed, 20 Mar 2019 06:47:33 +0000

Deloitte has released its retail predictions for the year ahead, noting 2019 will be a year of transition for US retailers.

Following a bumper holiday season, they tip this year will again be driven by disruption and an increased consumer expectation, where retailers who clearly understand their position, potential and role in the market will be best poised to thrive.

Here’s an insight into the retail trends of 2019 and the top tips that retailers can embrace to strike a chord with an increasingly savvy consumer.

A year of transition

Deloitte explains 2018 offered a lot for US retailers to digest. The year featured trade and economic tensions, mixed retail figures, some high-profile bankruptcies, yet a record-breaking holiday season.

It also saw the consumer expectation further increase, as the digitally savvy shopper continues to embrace the idea of having it all – convenience, values that align with their own, information at their fingertips, and a more personalized retail experience.

“The next 12 to 18 months will likely see an industry in transition—an industry managing through uncertain times and placing bets on what will separate the winners from the losers. Those who can synchronize their investments to profitably empower the consumer will likely find themselves on the right side of the tipping point.”

Why do you matter?

In 2019, retailers will need to know why they matter more than ever before. In an increasingly competitive online and physical space, they will need to be “crystal clear” about their offering and position in the market.

What makes you unique? Why would the consumer pick you? What can you offer in a way no-one else can? And how do you make yourself indispensable to your target market?

These are all questions retailers need to answer and thoroughly understand in order to carve out their niche in a world filled with choice and information.

I want it all…

It’s little secret today’s consumer is more empowered than ever before. They have choice, information and insight into products at their fingertips courtesy of the online world and social media.

They also have greater expectations of the retailers servicing their needs.

“Consumers realize they can have it all. Today’s digital consumer is increasingly connected, has more access to information, and expects businesses to react to all their needs and wants instantly. Many shoppers have an increased desire for personalized services, and they are starting to think more about privacy in the wake of high-profile corporate and social data breaches,” Deloitte reflects.

So, what is it that they want?

Convenience

In a time-poor era, convenience ranks as one of the key factors that consumers seek. This was also touched on at this year’s NRF Big Show when Lee Peterson of WD Partners noted click-and-collect, along with online order fulfillment, offered major potential for bricks and mortar.

In many cases it’s easier and cheaper to ship an item from a store’s inventory than from an online distribution centre, he explained.

Deloitte’s key tip: Win consumers with convenience

“The top reason consumers shop online: convenience. Alternative fulfillment-driven offerings that are more expensive to execute can improve experience. Invest in consumer-facing convenience that moves the needle, and look for opportunities to make up margin elsewhere.”

It’s personal

Consumers now expect to be viewed as more than a number or a faceless member of the crowd. Retail is personal, with data and analytics fueling the trend.

“Retailers should leapfrog their current approach to personalization, offering more than mass customization, which involves bucketing your consumers into a limited number of segments,” Deloitte claims.

“The next phase becomes an exercise in data aggregation and activation, reducing each segment to a single individual. Retailers should refine each consumer profile based on data from all types of sources—social media, transactions, and reviews— to achieve ultra-personalization.”

The importance of values

Brand loyalty continues to play a role in retail, but is a two-pronged approach focused on loyalty rewards and offering values that align with those of the consumer.

“Outside of adapting and refreshing the loyalty program, driving consumer loyalty can require a focus on integrity and identity to create an emotional connection,” Deloitte explains.

Their tip? “Consumers are spending their money in ways that align with their values and identity. Look for opportunities to unite consumers through a loyalty program by connecting on values.”

Not just innovation for innovation’s sake

In another theme that was touched on at this year’s NRF Big Show, Deloitte notes innovation should be focused on better servicing the consumer, rather than innovation for innovation’s sake.

“Retailers should start with the job to be done and understand the true values expected from the solutions. With this foundation, retailers can determine what internal and external technologies they need to fulfil their brand promise.”

You can read more about further predictions for retail in 2019 here, or gain an insight into the current state of retail outlined at this year’s NRF Big Show here.

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