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Retail Digital Investments Pay Off

by Robert Hetu  |  November 27, 2018  |  Submit a Comment

The improving economy, low unemployment, tax cuts and lower gas prices finally proved that there is not a retail apocalypse. Pent up demand is driving a great start to the holiday shopping period. According to Adobe Analytics on Thanksgiving Day, shoppers spend $3.7 billion online and on Black Friday, shoppers spent $6.2 billion. Cyber Monday sales topped $7.9 Billion, making it the single largest shopping day in U.S. history, this is largely driven by electronics, with $2B coming from smartphone sales alone.

Mobile generated almost 50% of ecommerce traffic but converted shoppers at a much lower rate than desktops. Akamai has released data for the first big shopping weekend of the 2018 season, and their data finds that conversion rates on mobile devices average 2.72%, with desktops averaging 5.12%. But, they also found that bounce rates are up – with mobile devices bouncing 34.71% and desktops bouncing 25.74%. Bounce rates mean consumers are getting blocked out and signal that the retailer must consider this a stress test and invest in digital infrastructure thereby correcting those problems.

Gartner has long predicted the store will become the hub of digital activity. Traditional multichannel retailers are seeing the benefits of investments in digital as Adobe sites a significant spike in the Buy Online, Pickup In-Store trend. In fact, the NRF survey found more than 89 million people shopped both online and in stores, up nearly 40 percent from last year.

We are reaching a tipping point where ecommerce capability is no longer a competitive advantage; it has become ubiquitous. Execution is the point of differentiation. Retailers must understand what their customers expect from a digitally enabled experience. Its not the same for every retail brand. Delivering a brand right, reliable customer experience that takes advantage of its unique market placement is the key to success. This is true whether Aldi and Kroger, or TJMax and Macy’s.

Gartner developed four retail scenarios for future success called Speed, Strength, Invisibility and Elasticity.



Retailers will focus on meeting the needs of consumers through technologies that support these scenarios.  Some examples of retailers in each scenario include:
o Speed (Aldi, Brandless, Dollar General)
o Strength (Ace Hardware, Wegman’s)
o Invisibility (Amazon, Macy’s, Target, Trader Joe’s, Walmart)
o Elasticity (Nordstrom, Neiman Marcus, StichFix)

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Category: retail-trends  

Tags: amazon  competition  consumers  customer-analytics  customer-centricity  digital  ecommerce  economy  macys  merchandising  multichannel  omni-channel  retail  revenue  satisfaction  stores  target  tjmax  trends  unified-retail-commerce  walmart  wegmans  

Robert Hetu
VP, Analyst Retail
7 years at Gartner
29 years IT Industry

Bob Hetu is a Research Director with the Gartner Retail Industry Services team. His responsibilities involve tracking the technology markets and trends impacting the broad-based retail merchandising and planning areas. Mr. Hetu is an expert in the areas of brand, vendor and assortment management, merchandise planning, allocation, and replenishment. Read Full Bio

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