Traditional Retailers Survive by Marketing Their Innovations
The sound of the future is getting louder for retailers. For many, that sound is the click of a computer button or the swipe of a screen on a mobile device. Bricks and mortar retailers, especially grocers, would like to hear the sounds of more shoppers in their stores. To achieve that goal, Nielsen analysts say they must innovate.
In the past several years, the number of shopping trips made by consumers has dropped from 171 to 146. At the same time, the average basket size has increased only slightly, from $42.72 to $46.76. What’s happening? The answer seems to be that consumers have discovered the convenience of online shopping. Consumers are also learning that the online marketplace allows them to find everything they want easily. There’s no need to go to 3 different stores to find the right ingredient.
To fight this trend, grocers, in particular, are coming up with new ways to get shoppers into stores. One successful strategy has been the development of in-store restaurants. Another strategy has been to improve the price-value ratio of the in-store experience and for many, this means rolling out more private-label offerings. U.S. consumers believe the following about private-label products:
- Less expensive than name brands 64%
- Good value for the money 43%
- Quality even with name brands 48%
To date, private label has captured a little over 15% of the U.S. retail market. However, nearly 40% of consumers say they intend to switch to these less expensive grocery brands.
This sort of innovation may be the key to traditional retailer success. In addition, retailers like traditional grocers can expand their efforts into supporting social causes that are important in the local community. Doing so may help them ward off the competition that’s rising from large digital operators.
Do you agree? What steps are your marketers promoting that can be labeled innovative?