Retailers to focus on store expansion & technology
16 Apr '10
3 min read
Having survived the worst of the economic downturn, many retailers are collectively breathing a slight sigh of relief while cautiously looking ahead to 2010, according to the eighth annual Retail Horizons: Benchmarks for 2009, Forecasts for 2010. The report, released by the NRF Foundation and KPMG LLP, examines benchmarks for the retail industry, reports retailers' key business priorities and plans, and tracks established and emerging retail trends. Based on a survey of more than 300 retailers, the report examines how companies reshaped strategic priorities last year and what core process improvements are necessary for a successful 2010.
In 2009, retailers were forced to rethink their strategic priorities because of changing market conditions and decreased consumer demand. According to the report, retailers last year overwhelmingly cited cost reduction as a top priority in store and field operations; human capital; marketing and advertising; and merchandising and IT.
“Last year, retailers placed a significant amount of energy into improving core business processes in order to better prepare themselves for a successful future,” said Kathy Mance, Executive Director, NRF Foundation. “Looking ahead, retailers will continue to analyze customer shopping habits and industry trends to make the best decision possible for their company, employees, customers and their brand.”
Benchmarks for 2009
• More retailers focused on direct mail, online and in-store promotions in 2009 instead of more costly areas such as event sponsorships, television and print advertising • Retailers increased private label merchandise offerings (32% of respondents in 2009 vs. 29% in 2008) • Retailers focused more on customer retention rather than customer acquisition • With an intense focus on pricing, retailers polled cited that promotionally priced merchandise made up less of the overall sales mix this year than last • Lower supply chain costs and warehouse optimization were big priorities for retailers in 2009 Forecasts for 2010
With all signs pointing to an improved economy and a more confident consumer in 2010, many companies are eager to invest in growth opportunities again. Key areas include store expansion, social media, targeted marketing and advertising, employee retention, leadership development, adoption of handheld technology devices and kiosks and website personalization options, to name a few.
A few survey highlights include:
• 43 percent of survey respondents said they expect to maintain the same number of stores throughout 2010; more than one-third (37%) said they plan moderate to aggressive expansion. • Nearly half (49%) of those polled report that personalization of their website will be a major investment priority for 2010. • After 61 percent of respondents said customer acquisition was a big part of their initiatives in 2009, only 49 percent will focus on that in 2010