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The retail industry will become more segmented and customer-driven by the year 2015, according to “Retailing 2015: New Frontiers,” a report released today by PricewaterhouseCoopers’ Retail & Consumer Industry Practice and TNS Retail Forward. The report identifies 15 growth drivers and predicts 15 trends that will redefine the retail environment in 2015. Among shifting demographics, household downsizing and new marketing channels, the retail industry will face a variety of new challenges as the industry progresses during the next decade.
“Overall, the retail industry will need to adopt a more targeted approach in order to reach its customers,” says John Maxwell, retail & consumer industry leader for PricewaterhouseCoopers. “The ‘one-size-fits-all’ approach of the 1980s is not going to work as the population becomes more diverse and tech savvy during the next decade.”
According to ‘Retailing 2015,’ the most rapidly growing age segment in the United States will be that consisting of those older than 55. Members of generation Y and millennials (those under the age of 35) will be more culturally diverse and technologically inclined, while less enamored of large conglomerates and chain stores than their baby boomer parents. In addition, the population will become increasingly diverse, with nearly half of the population under the age of 25 identifying themselves as non-white in 2015.
“Due to the demographic dichotomies, a new consumer mindset will emerge in 2015 that will have far-reaching implications for the retail industry,” explains Maxwell. “Consumers will want to be more interconnected with the businesses they patronize, exercise more control over their purchases, customize their products to serve their individual needs and indulge in shopping as a life experience.”
The study reveals that the fallout of marginal malls will continue as fewer existing malls reach their financial targets and conventional department stores fade away. New neighborhood centers will pop-up and will incorporate entertainment and dining into the shopping experience. The fastest growth will take place in developing retail markets, including China and India. Barriers to global trade will buckle as restrictions on foreign retailer operations are phased out.