12. 29. 2018 Blog

Retailers Prepare to Fight the Online Giants

What can retailers do to prevail against the Amazons of the world? The holiday season has proven it once again; the malls are crowded and checkout lines are long – Germans would still rather buy their Christmas gifts in stores.

Scenarios where we’ll be making all of our purchases online via tablets and smartphones have yet to fully materialize. It is positive to see that in the age of e-commerce giants such as Amazon, eBay, Rakuten and Alibaba, retail stores have been able to gain some new positive momentum.


According to a poll by business consulting firm PwC, which surveyed over 22,000 consumers in 27 countries, 60 percent of Germans shop in stores at least once a week. Just two years ago, only 46 percent did so, although still above the European average of 43 percent. Despite digitalization and its influence on consumer buying behavior, statistics show that German consumers want to be able to touch and try on products. German shoppers are reluctant to miss out on the personalized service and advice they get from shop assistants.


But pressure from the Internet is increasing and the retail trade must constantly assert itself in the digital age. So how does one respond to this threat?


Today’s customers want a shopping experience that leaves a lasting impression. To achieve this, ITMS has been advising a variety of clients for a number of years, from shopping malls to regional retailers. These include longtime client Main Taunus Zentrum in Sulzbach, the oldest shopping center in Germany. A diversified program and targeted communication make it possible to reinvent the shopping experience at this mall and keep the number of visitors at a consistent high level. Regular campaigns and live initiatives with promoters and hostesses turn shopping into a happening. Sound marketing communications strategies contribute significantly to the success. Social media is used to continuously engage with customers and to win over new ones to come out to the mall.


Such an approach can also be successfully applied to the local retail sector. Customer engagement is the key word, referring to measures that serve to build customer relationships and maintain them for the long-term. In order to increase this, it is crucial that retailers focus on their real strengths – personal service and intensive interaction with the customer. Personalized or specialized products and services are important in order to differentiate from online offerings. In the future, retailers will have to emphasize the event character of shopping even more than previously to better respond to customer expectations. The quality of guidance must be at a high level, and the setup of the stores as well as the offers must always be current.


In most cases, customers are already well-informed when they set foot in a store. Nonetheless, they expect “sales consultants” to be able to advise them with personal questions that are not googleble on the Internet. Even with excellent training, it goes without saying that sales consultants, sales assistants won’t do anymore, cannot know every detail about a particular product. It is therefore important for retailers to provide their employees with useful tools to allow them to quickly access the relevant information.


How digitalization will continue to influence people’s purchasing behavior in the future is not foreseeable, but make no mistake, omni-channel retailing is what consumers will expect. At the same time, it is an opportunity for trade. Those who want to be successful in the long-term must present themselves via a wide variety of different channels (e.g. online, print, in a physical shop, or by phone). They must also understand that an online store alone is not enough to compete with the powerful retail giants.


In order to make a business fit for the future, the focus should always be on the customer and their wishes. It is essential that retailers understand their customers and are also willing to explore new ways to make themselves unique and indispensable for them.