New research compiled by IGD and commissioned by Coca-Cola Enterprises Ltd (CCE) examines what lies ahead for the future shopping experience. Key findings show that there will not be just one model for future stores and that tomorrow’s shoppers will be more connected than ever before.

Five major themes will shape retailing tomorrow

Efficiency, return on investment and ease of shop will underpin all future developments, but five major themes will shape tomorrow’s retail environment. These are connectivity, empowerment, multi-channel, customisation and sustainability. Value for money will be important too.

Key developments to watch for include:

• The emergence of a new type of shopper, driven by an increasingly connected environment. The smartphone will become a ‘remote control’ of consumption, acting as a central device through which shoppers purchase and interact with brands, in the home and in the store. We’ll also see shoppers becoming more empowered, hungry for information and customisation. They’ll be willing to share considerable personal information, but will expect a lot in return.

• Not all shoppers will react in the same way to the future and a two-speed information society may well emerge with connected and non-connected shoppers having different needs. Some shoppers will be more concerned with areas such as sustainability instead, and will want ever higher ethical standards. For this type of shopper, traceability initiatives will gain momentum as they increasingly seek information about product origin and nutritional attributes.

• We’ll see all of these factors impact both front- and back-office operations. Growing connectivity and the need to adopt a more sustainable approach will be key factors in the evolution of stores and processes. We’ll also see a multi-channel approach become commonplace - retailers will increasingly see both online and physical stores as natural interaction points with the shopper.

A number of format scenarios are possible

There will not be just one ‘store of the future’. Each retailer will tailor their approach by location and target shopper. A number of format scenarios are possible, three of which are examined in the research – the connected store, the green store and the shopper-centric store.

Key developments to watch for include:

• The connected store will emerge from the explosion of technological innovation. Shoppers will use their smartphone to interact with the store, the products and with promotions targeted specifically at them.

• The green store will rely on increasingly transparent supply chains, with reduced water and energy consumption, less waste and better packaging to appeal to shoppers who are more and more aware of the impact of their shopping on the environment.

• And the shopper-centric store will be more tailored and customised to the needs of individuals and small groups of shoppers. A ‘store within a store’ approach, intelligent trolleys and occasion-based merchandising will add excitement and theatre to the off-line shopping experience.

Prepare now to capitalise on tomorrow’s opportunities

IGD helps businesses identify opportunities, improve performance and create a competitive edge. All three of these issues will be even more critical tomorrow and we can help your team develop the knowledge and capability to stay ahead of the game.

Challenges and opportunities that lie ahead:

• Substantial changes as online sales keep growing and new digital media start to reshape shopping habits. This will influence how retailers use their floor space as they seek to provide new, compelling reasons to visit the store.

• Every retailer will have to benchmark itself against the value provided by simple, stripped-to-the-basics, low-cost operators. All players will need to develop their marketing capability to drive differentiation and win with shoppers.

• To succeed in this new era, manufacturers will need to keep building their customer engagement capability if they are to be seen as strategic partners and category leaders. IGD will continue to support businesses in this mission, seeking to enhance performance across the whole industry.

Stay close to shoppers to keep ahead of the curve

The future will bring some of the ideas mentioned in this article to life – indeed many aspects are already in development; others may be just around the corner. One thing is certain: we won’t have thought of everything. And shoppers will have more ideas of their own. So it’s more important than ever to stay in touch with them and try to keep one step ahead.

Jonathan Gunz

Retail Innovation Analyst

IGD