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Ebeltoft Presentation September 2009 Abridged


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  • 2. RETAILTHOUGHTLEADERSHIP Australia We are pleased to introduce to you our 2009 Retail Thought Leadership report  Retail is a dynamic and diverse sector  Given the recent turbulence in the global economy, this thought- leadership research investigated the future of the retail industry in Australia and New Zealand  Primary interview data and secondary publication data were combined to 2 EADERSHIPREPORT © Copyright 2009. The Retail Doctor® Group Pty Ltd  Primary interview data and secondary publication data were combined to explore the key trends impacting the retail industry now and in the lead up to 2020  The results provide insight to retailers to navigate the current economic downturn and in prepare for major trends likely to impact the retail industry over the next decade
  • 3. OVERVIEWOFFINDINGSS Overview of findings - Short Term  There are growth opportunities for retailers during times of an economic downturn  The retail environment is currently in a fragile position and may appear substantially different in coming years  Retail consolidation will continue in the short term  Retailers must know their customer 3 SHORTTERM  Retailers must know their customer  Shift toward greater customer value  Need for retailers to offer something different
  • 4. OVERVIEWOFFINDINGSL Overview of Findings Long Term  There are a number of trends likely to develop and impact the retail sector. Continued trans-Tasman retail trend - retailers increasingly moving between Australia and New Zealand.  Differentiation, particularly through premium services will shape the retail environment in 2020  We will see a very different consumer – one who co-creates, and seeks 4 LONGTERM  We will see a very different consumer – one who co-creates, and seeks personalised products and services  Virtual networks will link consumers and technology will change the way in which consumers communicate with each other and retailers.  Consumer intelligence is key for the 2020 retailer
  • 5. KEYFINDING Key Finding  One theme was consistent amongst all interviewees - there is a need to ensure that retailer connect with what the customer wants, and not rely on mere volume sales via high traffic levels  Retailers are going to have to make sure they connect and remain relevant with consumers 5 relevant with consumers
  • 6. THEFUTUREOFRETAIL Why the Future of Retail?  Understanding potential future trends is a critical issue for retailers therefore this an important topic on our agenda  Providing strategic insight as to what lies ahead for retailers in the Australian and New Zealand markets provides retailers with a solid foundation to develop effective strategies during the economic downturn and beyond to 2020 6
  • 7. RETAILANDTHEECONOMY Background  Retail trade is a significant contributor to the Australian economy  More than 250,000 retail outlets  Generating more than $220 billion in annual sales (ABS, 2008; IBISWorld, 2009).  The last 10 years have been economically buoyant fuelling 7 CONOMY  The last 10 years have been economically buoyant fuelling much of retail growth  In late 2008 the retail industry globally was substantially affected by the Global Financial Crisis (GFC)
  • 8. CONSUMERCONFIDENCE Consumer Confidence  Australian consumer confidence declined the past 12 months. Largely attributed to the GFC and:  Consumers concerned about their personal finances  Consumers concerned about the finances of the country.  Confidence hit an all time low in the second half of 2008 (close to the levels of the 1990/91 recession). 8 levels of the 1990/91 recession).  Retailers therefore experienced tough trading  Asset values declined significantly
  • 9. CONSUMERBEHAVIOUR Consumer Behaviour  A shifting consumer attitude has been seen  Consumers more careful in their spending and have been ‘cocooning’ The term cocooning was coined during the 1991 recession and characterises consumers creating comfortable home life environments in order to spend more leisure time at home  This behaviour has had a negative effect on the sub-sector of ‘café’s, 9 restaurants and takeaway foods’ - the only subsector to experience a decrease in sales from the 2007 to 2008 period, with a decline of 0.4% (ABS, 2009)  This contrasts to relatively strong growth in food retailing with a 6.1% increase in sales (ABS, 2009)
  • 10. THEPASTDECADE Australian Review  Despite the relatively small size of the Australian market globally, the retail industry has become very competitive in the last decade  Retailers have worked hard to create stimulating shopping environments  Experiential retailing has been a popular element  Many retailers making use of technologies such as digital signage and kiosks to create excitement in-store. 10 to create excitement in-store.  In-store developments such as self-service checkouts have further improved the retail experience
  • 11. GOINGFORWARD Know Your Customer  Our research highlights importance of consumer insight (data collection and analysis)  Demographic  Psychographic  Behavioural 11  Consumer trends previously changed slowly allowing retailers to analyse their implications and make well-informed decisions  Consumer trends now emerge rapidly due to technology, accelerated social diffusion, instant communication, and increased willingness to accept – or inability to escape – new ideas (Wesely- Clough, 2006)
  • 12. Every Australian Shopper is Online MULTICHANNELRETAILING 12 ETAILING Implication: are you able to meet these information needs?
  • 13. BRAND &USER EXPERI ENCE  A good on line brand experience is not a separate experience to the transactional piece  A good on line brand experience = An integrated brand and transactional experience  A good on line brand experience should correlate with the in store experience MULTICHANNELRETAILING On Line Brand Experience 13 experience  A good on line brand experience will also address the needs of multi channel customers and will reinforce the values of the brand ETAILING
  • 14. AUSTRALIANEXAMPLE Green Retail  Field Force Australia takes advantage of the current interplay between government and retail  Customers are in a position of power to place pressure on the supply chain for environmental benefit. 14
  • 15. Field Force and The Retail Doctor  Brief: To develop a complete new to market national retail channel showcasing environmental and integrated product suites complementing Field Force multi channel offer.  Approach: The Retail Doctor developed a Fit for Growth diagnostic™ including full channel planning, broad strategic positioning and all operational, merchandising and financial planning to underpin a new AUSTRALIANEXAMPLE 15 channel to market including a review of all merchandise ranging products based on strategic positioning, life cycle and profit analysis, new layouts and plan-o-grams based on best practice retail principles.  Solutions: Economic feasibility based on strategic positioning, initial ranges merchandise ratios design and all operational systems and frameworks are completed and on track for the first store to open.
  • 16. SUMMARY Summary  Successful retailers will  Understand potential problems early  Implement strategic vision  Consider their customer  Examine the complete customer 16 experience  Tie customer needs to core products and differentiators.
  • 17. For more information and to see how The Retail Doctor can help you become ‘Fit for Business’ please connect with us. Facebook: Twitter: LinkedIn: Thankyou for viewing the abridged version of The Retail Doctor’s 12th Annual Latin American Retail Forum Presentation. THE RETAIL DOCTOR® GROUP PTY LTD © Copyright 2009. The Retail Doctor® Group Pty Ltd Mailing Address PO Box 209 Milsons Point NSW 2061 Phone | +61 (0)2 9460 2882 Fax | +61 (0)2 9460 3883 E-mail | Web: | Alternatively, you can contact us on the details below: