Cosmos Editorial
The way we shop has changed profoundly over the past few decades, and it will continue to do so, say two experts in the field who yesterday talked to Professor Alan Duffy of the Royal Institution of Australia in a Cosmos Briefing focused on the retail trade.
The session began on a note of humour when Jonathan Reeve – author of Retail’s Last Mile: Why Online Shopping Will Exceed Our Wildest Predictions – was asked about the rise of online giant Amazon.
It seems now, he says, as if Amazon’s success was assured. “But in fact, if we [went] back to 1997 and bought Amazon shares, that time they were as low as $1.50. So if we’d invested $1,000 back then we’d now be multimillionaires. And [would] probably be in the Bahamas and not [doing] this podcast.”
Jokes aside, Reeve points out that e-commerce’s success was never assured, and that it’s been a gradual rise for the sector, with sales roughly doubling every five years.
“So Amazon started off in the mid 90s, [and] almost went bankrupt a couple of times in the late 90s, early 2000s,” Reeve says. “By about 2000, around 1% of retail sales was online; in 2005 that had risen to 2%; 2010, it had risen to 4%; 2015 it was up to about 8%. And it’s probably now more than doubled, [due to] the impact of COVID.”
Neil Ridgway, Chief Brand and Marketing Officer at Rip Curl International, was clear about his company’s focus on customer experience, no matter the data that was collected along the way during transactions.
“I think that the exchange of data is really important with customers, because you’ve really got to think about what the customer wants,” Ridgway says. “And the data that they want to give you freely and with consent is the most important.”
Ridgway points out that there’s typically a lot of data that retailers can mine to learn about their customers’ habits and preferences, but he says the best use of data is to “personalise our communications … to actually service [customers] better – [to] provide them with the right information and the right stimulus to come and purchase”.
Reeve broadly agrees.
“To be successful in retail is all about delivering better customer experience, ultimately, that leads to sales,” he says. “What I see is, if retailers are really focused on using their data to deliver better customer experience, then … in the long term that’s also going to lead to better sales. And that’s what I think the best retailers are doing.”
And as for retailers shrinking their environmental footprint? It’s worth listening in just to hear about wetsuit recycling.
“If I could change one thing,” says Ridgway, slightly longue in cheek, “I would use technology to abolish the swing tag. I think the swing tag on products is the bane of my existence.” Ridgway would opt for “a QR code … or a simple mechanism that allowed the customer to get information” without the waste of swing tags. There must be billions of the things thrown away, he reckons.
Both guests agree that retail’s future is hard to predict. Reeve thinks as much as 50% of all sales could be online in 10 years; Ridgway thinks that shopfront retailing has a healthy future, especially for people looking to buy such things as wetsuits and surfboards.
Read more about this topic in these Cosmos online articles:
- To help the environment, should you shop in-store or online?
- John Wanamaker makes a sale
- Gender roles influence economic expectations