Pre-Holiday Poll Shows Notable Tech Adoptions and Operational Adaptations
As technology innovations continue to transform the retail industry, it appears that bricks-and-mortar stores are leveraging the benefits while adapting to a new consumer landscape, according to retail real estate services firm Levin Management.
Based in North Plainfield, N.J., Levin annually in late October/early November polls store managers within its 95-property, 13 million-square-foot shopping center portfolio. The latest findings reveal strong adoption of mobile technology as an integral part of the marketing mix and notable operational changes in response to an increasingly e-commerce-centric world.
“The fact that technology innovations have firmly entrenched themselves in how the retail industry does business is well established,” noted Levin Management’s Matthew K. Harding, president. “At the same time, the speed of adoption – and adaptation – reflected in the Levin pre-holiday survey is truly quite interesting.”
Regarding mobile technology, 85.3 percent of respondents indicated that they are using this platform in their marketing mixes. This figure is up from 68.0 percent one year ago and 52.6 percent in 2012. And of those respondents who have been employing mobile technology for at least a year, 53.4 percent indicated that they are using this tool to a greater extent in marketing for the 2014 holiday season than in 2013.
This emphasis may be well founded. In Accenture’s Holiday Shopping Survey, 76 percent of participants “said they would definitely use or would be willing to try mobile services that provide them with real-time promotions and offers as they shopped in-store if those services were offered.”
For the first time, the Levin Retail Sentiment Survey asked participants whether their company has adapted its business model in response to the growth of e-commerce. “The conversation has moved on from whether e-commerce is impacting bricks-and-mortar stores to how they are changing to prosper in an increasingly online shopping-centric world,” Harding said. “We were encouraged by how our retailers responded.”
In fact, 44.0 percent of survey participants indicated that their organizations have changed to accommodate e-commerce in some way. These adaptations included increased collaboration between in-store and online operations (54.4 percent), added in-store pickup and return options (41.3 percent), altered in-store inventory (34.8 percent) and altered store prototypes (23.9 percent).
“Based on how the percentages add up, it looks like retailers are making multiple changes as the new environment evolves,” Harding said. “We like that the ‘increased collaboration’ response garnered the highest percentage because it indicates that the relationship between online and in-store is becoming more symbiotic.”
That shift may benefit retailers this holiday season. According to the Accenture study, 71 percent of shoppers plan to research purchases online and then make them in stores (“webrooming”), while 68 percent say they will go to see products in stores and then purchase them online (“showrooming”).
According to Harding, the future and benefits of this type of omnichannel retailing, where companies balance the benefits of online and in-store experiences, is clear. “A recent Harvard Business Review blog does a great job of summarizing this phenomenon,” he said. “It reads, ‘websites and mobile apps are not just e-commerce ordering vehicles, they are front doors to the stores. Stores are not just showrooms, they are digitally-enabled inspiration sites, testing labs, purchase points, instantaneous pick-up places, help desks, shipping centers, and return locations.’ We at Levin could not agree more.”
Levin’s next retail sentiment survey will be conducted in early January, gauging 2014 holiday sales performance. In business for six decades, Levin is one of the nation’s leading retail real estate services firms, with a strong focus in the northeastern United States and an owner’s approach to the business. Levin provides leasing, property management, accounting, construction management and marketing services for properties ranging from neighborhood, community, lifestyle and power centers, to enclosed malls, street retail, downtown stores and mixed-use projects in New Jersey, New York, Pennsylvania, Massachusetts, Virginia and North Carolina. The company specializes in repositioning, retenanting and renovating retail properties – areas that have become particularly vital for today’s institutional and individual property owners.