Top 10 Retail Challenges for 2010
Sam Jordan, MD of Baber Smith (January 2010)
We asked a group of top retail marketers what energised them and what kept them awake ‘til the early hours. Read on to find out what they identified as the top ten challenges for the year ahead.
In no particular order…
1. The General Election. The bewildering lack of clarity about the main parties’ policies is breeding uncertainty. Which, in turn, makes business planning even tougher and adds to the difficulty of gauging consumer confidence.
2. Consumer Attitudes. Right now no one knows how 2010’s going to pan out. Will growing consumer confidence help lead the recovery or will a second dip knock the stuffing out of it? It’s all a bit chicken and egg and judging the mood of the nation correctly is vital to positioning brands and being relevant to shoppers.
Gordon Lee, Director of Nike Teamwear & formerly of Ann Summers comments: "Accurately reflecting the mood of the nation will be one of the biggest brand communication challenges facing all retailers. We should plan for another roller-coaster year of extremes."
3. The World Cup. Always a mixed blessing - what’s good for pubs and the nation’s morale isn’t necessarily good for the high street. A few retailers will benefit from World Cup fever but most will have to work even harder to still be noticed.
4. Constrained Budgets. Whilst the green shoots are being nurtured, budgets are often still shrinking. Making the most of the recovery is key but without a war chest to win back customers the focus must still be on driving efficiencies and maximising short-term ROI.
5. VAT. Opinion is split over whether the reduction to 15% actually helped. However, there’s a fear that paying for it will come in the form of rises above the 17.5% level and that would have an impact. Again, uncertainty is not our friend.
6. Multi-channel Retail. One trend that is set to continue is the growth of multi-channel customer interactions. It may be through communications, sales or service but it will be led by customers increasingly demanding more responiveness and convenience from brands. Time to get our online, social media and mobile thinking caps on.
7. Integrating Social Media. The boom in popularity of social networks will impact brands across business functions, primarily PR, Marketing, Customer Services and Sales. Without a clear consolidated strategy, it’ll be like herding cats and we could lose valuable opportunities to enhance/maintain/defend our brands.
8. Brand vs Tactical. Managing the right balance of promotions and investment in brand communication is going to be vital in 2010 and beyond but, as we’ve mentioned, judging the mood on the high street makes this much trickier.
9. Regaining Trust. It’s not just banks and politicians that have created disillusionment. Trust in brands and businesses as a whole took a monumental battering in 2009.
Jo Kenrick, Non Executive Director, Principality Building Society & former Marketing Director B&Q explains: “The public will be looking very carefully at the brands and organisations that they are dealing with, and I believe that the most successful businesses will be those who meet this scrutiny head on and face to face with a real willingness to be transparent about their processes and their governance.”
10. Finding the Right Partners. The proliferation of challenges created by social, economic and technological change has never been more intense. Too many agencies seem slow or unwilling to adapt to this change making it harder for marketers to find partners capable and flexible enough to help them.
So, the only certainty seems to be uncertainty, be it political, economic or social. We’ll need to be nimble, flexible and fleet of foot to cope with whatever 2010 throws at us. One area where we can be sure we need to act is in managing brand’s interactions with the public to rebuild trust and engender loyalty. Every channel has a role to play and, for our part, we look forward to working closely with our clients to guide brands through the choppy waters ahead and make the best of 2010. Challenges aplenty, but every one is also an opportunity.