Retailing 2015: New Frontiers - The Shopsumer Institute

Retailing 2015: New Frontiers - The Shopsumer Institute

Retailing 2015:New Frontiers

ContentsPoint of View ........................................................... 215 Facts of Retail Life for 2015The Evolving Retail Landscape........................... 315 Trends for 2015 ................................................ 13Managing Complexity in 2015 ............................. 16Retailing 2015The Outlook ............................... 21Production TeamAuthorElaine Pollack614.355.4013epollack@retailforward.comElaine Pollack is Executive Vice President of TNSRetail Forward. Elaine has more than 30 years ofconsulting experience with retailers and consumerproducts companies. She specializes in strategicplanning and marketing research and analysisdesigned to identify and characterize opportunities forbusiness development and profi table sales growth.She graduated Phi Beta Kappa from Douglass Collegeof Rutgers University with a Bachelor of Arts degreein English and holds a master’s degree in Englishliterature from Columbia University.TNS Retail Forward ContributorsRob Gallo, Vice PresidentLois Huff, Senior Vice PresidentTom Rubel, President and Chief Executive Offi cerJames Russo, Vice PresidentDan Stanek, Executive Vice PresidentKelly Tackett, Senior ConsultantMary Brett Whitfi eld, Senior Vice PresidentProduction AssociateLisa Weiderman© 2007 TNS Retail ForwardNo part of this work may be reproduced or transmittedin any form or by any means, electronic or mechanical,including photocopying, recording, or by anyinformation storage and/or retrieval system, withoutpermission in writing from the publisher.

Point of ViewBetween now and 2015 will be a time of transition forretailing.Long-term cycles are coming to a close. New marketforces are becoming more prevalent. As thesetrajectories converge between now and 2015, they willchange the retail business environment—and the wayswe do business—forever:●●●●●●●The Baby Boom—which has dominated retailthinking for decades—will stand on the precipiceof age 70 and will start turning over the keys toyounger generations.Interconnectivity will be a part of life—and alsoa way of life. It will impact the way people getand share information, communicate, transactbusiness, even the way they socialize.Many existing retail concepts will reach the end oftheir expansion runway.Spending on services will grow at the expense ofspending on goods.The prevailing belief that bigger is better will breakdown. Aggregation of small will be the new big.Leading companies will combine global scale withexcellence at local execution.Global scope has been an option. In 2015, it willbe a requirement to support large-scale growth andsound business economics.Consolidation of retailing into a global oligopolywill continue, as major players seek expansion inemerging markets experiencing rapid growth of themiddle class and rapid modernization of retailing.●●●●●Retailing will evolve toward true demand—replacing the artifi cial demand dictated by thelimitations of shelf space—in an increasingly digitalretail environment where shoppers will have almostinfi nite visibility into product choice and increasinginput into product creation.Digital and personal media will continue to growexponentially and create new channels forcustomer insight, interaction and engagement.The value chain will become more intimate.Consumers will share more information withretailers and suppliers but will expect to get morevalue in return.Just-in-time supply chain and the technology tosupport it will no longer be the gold standard;extremely reduced cycle times will requireaccelerated trend identifi cation, entry and exit.Consumers won’t be able to take resources forgranted anymore. Resources will be scarcer, ingreater demand and hence more expensive—raising the bar on expectations for corporateresponsibility and product sustainability.The goal of this report is to:●●●Explore the change drivers—the assumptions thatdrive this outlook and the trend lines that will mergeto form the new facts of life for retailing in 2015.Describe the trends that will dominate the future.Identify the critical success factors retailers andsuppliers must address to manage the complexityand diversity of retailing in 2015.●●“Point of purchase” will be the battlefi eld forconsumer dollars—replacing the confi nes of “shelfspace” and “selling fl oor.”Technology will be pervasive—driven by fallingcosts, widespread access and adoption, a workinginfrastructure and increased standardization.To succeed in 2015, retailers and suppliers mustremember what got them there—and also embracenew assumptions that drive the new outlook. Pastbusiness drivers will wane but won’t entirely disappear.New business drivers will become more prevalent.2 Retailing 2015: New Frontiers, April 2007

15 Facts of Retail Life for 2015The Evolving Retail LandscapeAs existing patterns play out during the next decade,the retail marketplace will face a very differentlandscape in 2015. Here are the top 15 facts of retaillife in 2015 as we see them:1. Demographic DichotomiesThe period between now and 2015 will be one ofdemographic dichotomies. Many demographicdichotomies already are under way, but the gapsbetween shopper segments will widen during the nextdecade. It will be much more diffi cult for retailers tobridge these gaps in 2015. To fi nd growth, retailers willneed to look at the poles. There will be no safe middleground. Different ends of the shopper spectrum willrequire different products, shopping environments andbrand strategies. Even if customers at opposite poleswant to buy the same things, retailers will not be able tosell to them in the same way, in the same place or withthe same message.Demographic dichotomies will dominate several scales:• Older vs. Younger—Society will hourglass rapidlyalong the age spectrum, with all of the growthbetween now and 2015 happening in the oldergenerations or the younger generations (Figures 1and 2).Figure 2Generations as a Percent of the U.S. Population, 2015FBoomersAge 51-6923%Gen XAge 39-5015%Source: U.S. Census BureauMaturesAge 70+10%MillenialsAge 0-2028%Gen YAge 21-3824%Refl ecting the path of the Baby Boom bulge,the most rapidly growing age segment in theUnited States will be 55+. By 2015, leading-edgeBaby Boomers will be staring age 70 head on;trailing-edge Boomers will be looking at 50 in therearview mirror. If 50 was the new 30, will 70 bethe new 50? Do not expect Baby Boomers togo conventionally into maturity. Expect them toredefi ne older age and retirement, remaining activeand involved.Figure 1U.S. Population Growth by Age—2005-2010F, 2010-2015F(% change)2005-2010F2010-2015F19%16%2%2%5%6%5%13%9%-2%-8%-5%Source: U.S. Census Bureau

There will also be growth at the younger end of theage spectrum, among customers younger than age35—the Gen Y and Millennial cohorts. Gen Y willreach its prime household formation years. Liketheir Baby Boomer parents, members of Gen Y areshoppers, but they are more diverse, less enamoredof large conglomerates and chain stores, moreinterested in entertainment and recreation, and morelikely to be multi-channel shoppers.The Millennials will traverse the teen years. Thisgeneration’s mindset and approaches to themarketplace will be radically different from precedinggenerations. Diversity is just a part of who they are.Technology is part of their DNA.●Multi-cultural vs. Mainstream—Another keydemographic dichotomy is the growth of multiculturalAmerica compared with mainstreamAmerica. The U.S. population will be more diverseby 2015, as the population tilts toward youngercohorts, which are more diverse than older cohorts(Figures 3 and 4). The population explosionand geographic dispersion of Hispanics is a keydriver of diversity in younger generations (Figure5). While less than one-fourth of the populationage 55+ will be non-white in 2015, nearly half ofthe population younger than age 25 will be nonwhite.Among younger generations, diversity itselfbecomes the mainstream—part of the defi nition ofwho they are.Figure 3Percent of U.S. Population by Race/Ethnicity, 2005 and 2015F2005Asian-American**5%Hispanic13%Hispanic16%2015FAsian-American**6%African-American*12%White*70%African-American*13%White*65%* Non-Hispanic population** Non-Hispanic population; includes Asian, Pacific Islander, American Indian, Eskimo, AleutSource: U.S. Census BureauFigure 4Distribution of Age Ranges in the U.S. by Race/Ethnicity, 2015Other*As-Am**Af-Am*Hispanic1% 1% 1% 1% 1% 1% 1%6% 6% 6% 6% 5% 4% 4%14% 14% 14% 14% 12% 11% 9%22% 20% 17% 16%13%10%8%White*57% 59% 62% 63%68%74%79%

Figure 5U.S. Hispanic Population by Age, 2015FFigure 7Family Households as a Percent of Total U.S.Households, 1995-2015Under 1414-2425-3435-4445-5455-6465+8%8%Source: U.S. Census Bureau15%13%11%19%26%45%70.5%Forecast70.0%69.5%69.0%68.5%68.0%67.5%67.0%‘95 ‘97 ‘99 ‘01 ‘03 ‘05 ‘07 ‘09 ‘11 ‘13 ‘15Source: U.S. Census Bureau and The Brookings Institute●●Families vs. Households—By 2015, there will bemore smaller households of one or two persons,and fewer traditional family households due to theaging population, empty nesters and singles youngand old (Figures 6, 7 and 8). Opportunities willabound for smaller, more personalized productsand living spaces, and for experiences that are funfor one.Redeploying vs. Shouldering—During thenext decade, Baby Boomers will begin to exitthe work force and redeploy their vast energiesand spending power. In their stead, youngergenerations will shoulder the burden in the workforce and in the retail marketplace.Growth of the labor force will slow as BabyBoomers exit and the smaller generations thatfollow cannot make up the gap. The loss ofworkers will be particularly acute in the middlemanagement ranks, as the overall number ofworkers aged 35-54 contracts (Figure 9).Figure 6Average Number of Persons per Household in theU.S., 1995-2015Figure 8Percent of Household by Type in the U.S.26% 29% 31% 32%13%61%Figure 9Numeric Change in U.S. Labor Force by Age (000s),2004-2014F-11015%16-2416% 17%56% 53% 51%1980 1990 2000 2006Non-Family HHsFamilies w/Non-Married HH HeadFamilies w/Married HH HeadSource: U.S. Census Bureau, The Brookings Institute2.652.60Forecast25-344,5482.55-2,81335-442.5045-541,7692.4555-647,6162.402.35‘95 ‘97 ‘99 ‘01 ‘03 ‘05 ‘07 ‘09 ‘11 ‘13 ‘15Source: U.S. Census Bureau and The Brookings Institute65 and olderSource: U.S. Bureau of Labor Statistics3,689www.retailforward.comRetailing 2015: New Frontiers, April 20075

●Some of this loss will be offset by the large youngergeneration entering the work force. However,most of these employees will be “early-curve”workers who have not yet developed the skillsand experience base to fortify the ranks of midlifeworkers.Some of the loss will be offset by Baby Boomerswho remain in the labor force either by economicnecessity or by choice. However, many BabyBoomers will be “late-curve” workers who are eithertoo expensive or too highly skilled for mid-careerroles. Others will opt out of traditional work roles,preferring to pursue their own business interests orto cycle between periods of work and leisure on anas needed or as desired basis.Thriving vs. Surviving—The coming decadewill also witness a widening gap between havesand have-nots in terms of wealth, education andtechno-literacy. The top 10% of households willaccount for a growing share of total income (Figure10). Baby Boomers will represent a microcosmof have vs. have-not in the form of prepared vs.unprepared for retirement. The Baby Boom will bethe fi rst generation to retire with 401Ks instead ofpensions. Some will work because they want to;some will work because they have to.2. Disruptive WavesBetween now and 2015, the biggest consumer causesof disruption in the retail marketplace will be fi rst-waveBoomers and the Digital Generation (Second-waveGen Y and fi rst-wave Millennials, collectively). TheFigure 10Top Decile Share of Household Income, 1980-200546%44%42%40%38%36%34%32%30%1980198219841986198819901992199419961998200020022004Source: March 2007 Saez and Piketty analysis of tax return statistics,University of California, Berkeleyaging of the Baby Boom will affect the ability of manyretailers to grow and prosper. The coming of age of theDigital Generation will affect how retailers can grow andprosper.●●First-Wave Boomers—As they approach age70, fi rst-wave Baby Boomers will be reaching alifestage where spending on many goods beginsto decline (Figure 11). They will have new needs,driven by smaller households, increased emphasison health and general welfare, and increasedservice demands as “help me” replaces “DIY.”They will have new requirements—smaller, closer,easier. And they will have new desires, suchas quality of life, experiences, entertainment,enrichment, leisure and legacies. Compared withprevious generations of retirement-age consumers,fi rst-wave Boomers will be more highly educated,more economically empowered and more selffocused.The biggest difference will be amongfemale Boomers, as the fi rst retirement generationof women who have had signifi cant careers, strongearning power and confi dence in their abilities—driving high expectations for a productive seniorlifestage.Retailers and suppliers will need to respond withoffers that are age- and attitude-appropriate,but take into account the inevitable changes inpriorities that occur with maturity—focusing onproducts, services and experiences that helpBoomers defy, deal with or enjoy age.First-wave Boomers will also have a new credoas “I don’t get anyone under 30” replaces youth’srallying cry of “I don’t trust anyone over 30.”The Digital Generation—It has been about 50years since rock ‘n’ roll ignited a generation gapbetween young people and their parents. Today,there is a new generation gap looming, drivenby the digital “divide” (Figure 12). Growing upin a world where there are very few physicalor psychological barriers to trying new ways todo things, the Digital Generation will epitomizethe new mindset of the decade: Everything isinterconnected, anything goes, everything isavailable, and nothing is private. They will besavvy, skilled shoppers, who place a high level ofimportance on individualism, self-fulfi llment andpersonal involvement in the creation process.Retailers and suppliers will need to respond byproviding members of the Digital Generation withthe tools they need create, co-create or re-create tosuit themselves.6 Retailing 2015: New Frontiers, April 2007

Figure 11Percent Change in Spending by Category vs. Prior Age Group, 2005As consumers age:60%60%40%40%20%20%0%-20%-40%-60%-80%35-44 45-54 55-64 65-74 75+• Softgoods take the earliestand biggest hitsFootwearWomen's and girlsapparelMen's and boysapparel0%-20%-40%-60%-80%35-44 45-54 55-64 65-74 75+• Homegoods soon followConsumer ElectronicsFurniture/homefurnishingsPets, toys,hobbies, etc.60%60%40%20%0%-20%-40%-60%-80%35-44 45-54 55-64 65-74 75+• Then consumables spendingslowsSource: U.S. Bureau of Labor StatisticsFood at homeFood away from home40%20%0%-20%-40%-60%-80%Healthcare35-44 45-54 55-64 65-74 75+Personal care products• Healthcare is the only bright spotThese two disruptive waves will represent a challengefor many retailers and suppliers. Compared with thebig-spending Baby Boom generation, new spenders willbe less attractive. Fewer will have reached their bigspendinglifestages. They will have less buying power.They will be more fragmented into niche interestmarkets. They will demand more personalization.They will be harder to reach with conventional media,marketing and formats.Figure 12DQMOT, butIMNSHO F2Ftalk is NBD BC AIM is thebest way to KIT. BYKT.GGN. BIL. HAND.Translation:Don’t quote me on this, butin my not so humbleopinion, face-to-face talk isno big deal because AOLInstant Messenger is thebest way to keep in touch.But you knew that. Gottago now. The boss islistening. Have a nice day.3. New Consumer MindsetA new set of underlying drivers will permeate oursociety and our shopping behavior. Four mindsetmega-trends will have far-reaching implications for theretail marketplace of 2015:●●Interconnected—By the middle of the nextdecade, interconnectivity will be a part of life.Consumers will expect to connect to anyone,at any time, about anything, from anywhere.Interconnectivity will also be a way of life—the waypeople get and share information, communicate,transact business, even the way they socialize.Social status in the next decade will becomemuch more about whom you connect to and whowants to connect to you. Expect an explosion ofsocial networking sites designed to expand theindividual’s reach.In Control—With interconnectivity as a baseassumption, consumers also will become moreadept at controlling the ways in which they interact.Control will take three forms:www.retailforward.comRetailing 2015: New Frontiers, April 20077

●–––Clout Control—Consumers will fi nd thereis strength by association to drive change.Crowd clout will help consumers demandthe products they want, via the shoppingexperience they want, from companies that dobusiness in the ways they want.Context Control—Tools and technologiesthat enable time-shifting and place-shiftingincreasingly will allow consumers to captureinformation, communicate and conducttransactions regardless of the time or theplace.Contacts Control—Consumers also aregaining more control of whom they let into theirinterconnected “world.” They are increasingtheir use of fi ltering mechanisms to create a“closed loop society,” where connectivity islimited to the contacts they allow in. Suchfi ltering mechanisms today include spamfi lters, permission-based marketing, cell phoneas primary phone, caller ID, and sites whereconsumers can “reject” unwanted contacts.Expect to see a proliferation in social networksthat are more fi nely focused and, in somecases, more exclusive in the ways peoplefi nd and join them. Unlike mega-networksdesigned to extend reach, the goal of thesemicro-networks is to narrow reach to specifi cniches of similar interests.Indulgent—In 2015, consumer indulgence will●be focused on the “next new thing” and the “nextbest thing.” Interconnected shoppers will have thetools to easily discover, fi nd, fi lter and try the nextnew thing—at ever more affordable prices—andthen quickly move on. Given virtually unlimitedaccessibility to the next new thing, consumerindulgence will shift to the next best thing, that is,niche products, experiences and services uniquelysuited to their tastes, interests and aspirations.Individualized—Shoppers will gravitate towardproducts and experiences that offer individualfocus, interaction and involvement in the entirevalue chain process. They will desire productsand experiences they perceive as meeting theirunique needs. They will want the opportunity tointeract at the individual level with retailers andsuppliers. Taken to the extreme, they will seek outopportunities for involvement in the entire chainof activities that brings a product to market—fromconception, design and creation, to marketing andretailing, even to funding and rewarding.4. Retail Runway Runs OutMost major retailers will be out of expansion room inthe United States for their core concepts by 2015. Veryfew formats will grow at a rate exceeding the overallretail sales growth forecast—and virtually all of thosewill grow at a slower rate than earlier in the millennium(Figures 13 and 14). Players will need to turnelsewhere for growth—new concepts, new customersegments, new geography, new categories.Figure 13Formats with Above Average Sales Growth Outlook33.2%27.7%15.7%10.2%12.3%9.2%5.9% 6.5% 6.4% 5.5%Non-autoRetail SalesGrowth Forecast5.2%5.8% 5.4%E-commerce Supercenters CE &ApplianceStoresWarehouseClubsConvenienceStoresDrug Stores2001-2006 2006-2011FSources: U.S. Department of Commerce and TNS Retail Forward8 Retailing 2015: New Frontiers, April 2007

Figure 14Formats with Below Average Sales Growth Outlook8.2%6.5%5.9%5.5%4.7% 4.7% 4.6% 4.9%4.4% 4.3% 4.2% 4.3%3.9%3.5% 3.5%3.1%2.6%2.6%2.9%2.3%Non-autoRetail SalesGrowth Forecast5.2%1.9%1.7%1.3%BuildingMaterialsHardware& GardenSupplyHomeFurnishingsStoresSportingGoodsStoresJewelryStoresApparel & FurnitureAccessories StoresStoresOfficeSupplyStoresSmall-FormatValueStoresShoeStores2001-2006 2006-2011FSupermarkets-0.9%DiscountDepartmentStoresBookStores-2.2%-0.4%DepartmentStoresSources: U.S. Department of Commerce and TNS Retail Forward5. Growth in Spending on ServicesSpending on goods will continue to lose ground tospending on services (Figure 15). Older generationsare becoming more service, “do it for me” andexperience oriented. Younger generations are morelikely to approach goods, services and experiencesas an integrated continuum. To satisfy customerneeds, retailers will need to incorporate services andexperiences into their concepts.6. Growth in Nontraditional SpacesBetween now and 2015, the retail landscape willevolve. The shakeout of marginal malls will continue,fewer conventional malls will be built, fewer existingmalls will perform well, fewer shoppers will traffi cmalls with high frequency, and there will be fewerconventional department stores to go around as mallanchors (Figure 16). More lifestyle and neighborhoodcenters will come on board, where retailing minglesFigure 15Personal Consumption Expenditures: Goods vs. Services, 1980-200660%Services50%40%30%Goods20%10%0%1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004Source: Bureau of Economic Analysiswww.retailforward.comRetailing 2015: New Frontiers, April 20079

Figure 16Number of New Regional/Super-regional Malls Opened per Year, 1998-2008P19161291053896481652674 421988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008PSource: International Council of Shopping Centerswith nontraditional traffi c drivers. These will be placeswhere people can go to eat, entertain and live—notjust shop. High-performance malls will continue toreinvent and reinvigorate—many by taking a lessonfrom lifestyle-driven formats. The Internet will exertmore infl uence—continuing to grow rapidly as a retailchannel, but, even more importantly, continuing to growexponentially as the conduit to the vast marketplaceoutside traditional space.7. Growth in Nontraditional PlacesGrowth in most developed retail markets will be slow.The fastest growth will take place in developing retailmarkets, including the huge markets of China and India(Figure 17). Retail issues in developed markets aroundthe globe basically will be a mirror image of issuesconfronted by the U.S. economy—aging populations,shrinking share of retail spending and increasedspending on healthcare. In contrast, populations indeveloping markets will remain relatively young and willincrease share of retail spending. Developing marketswill continue to build a big pool of university-educatedlabor and talent, shifting the nucleus of knowledgeworkers. Trend-spotters will want to set up camp indeveloping markets, especially Asia, which will begin toeclipse developed markets as a hotbed of cultural andretail market infl uence.8. True Global EconomyIn 2015, retailers will do business in a true globaleconomy—global customer base, global sourcing,global outsourcing pool, global reach. Barriers toFigure 17Non-auto Retail Sales Growth Outlook, 2006-2011FCompound average annual growth ratesRussia15.4%Nigeria12.8%Turkey11.2%Indonesia10.6%Vietnam10.4%India10.4%Philippines9.7%Argentina9.6%China8.9%South Africa7.9%Thailand7.7%Mexico7.2%Malaysia7.1%Brazil6.6%Spain6.0%Australia5.7%United States5.2%South Korea5.1%Canada4.7%Poland4.6%United Kingdom4.1%Belgium4.0%Netherlands3.6%Taiwan3.6%Italy3.0%France2.9%Sweden2.8%Germany2.2%Switzerland1.3%Japan0.8%Sources: National statistics offices, OECD and TNS Retail Forward10 Retailing 2015: New Frontiers, April 2007

global trade will continue to come down. Impedimentsto global sourcing will continue to ease. Developingmarkets will continue to phase out restrictions onforeign retailer operations and liberalize regulation ofdirect foreign investment.Global scope will be a necessity, not an option,to grow the top line and bolster the bottom line.Global expansion will be a key avenue for retailersin developed markets to generate new sources ofrevenue to offset slower sales growth at home. TheInternet will provide global customer reach even in theabsence of a global footprint. Global sourcing will bea critical component of differentiated assortments atcompetitive price points. Global outsourcing will bevital to reining in expenses while keeping the businessfocused on core differentiating capabilities.9. American Retailers Play Catch-upTo support growth projections, more American retailerswill need to expand globally. They will be late to thegame, especially compared with large Europeanretailers, which have long operated on an internationalscale, and local retailers in developing markets, whichhave been riding the coattails of grassroots opportunity.American retailers will have a harder time getting afoothold in global soil. In many places, Americanproducts will no longer be the status symbols theyonce were, especially as local and developing marketinfl uences gain popularity. As middle-class consumersemerge around the globe, the United States will nolonger be the main customer for goods and resources.Global expansion will require local partners, personnel,products and perception into local customers andcultures. American companies will have to play byglobal standards.10. Retail Battleground RedefinedIn 2015, the battleground for retail sales is broader—point of purchase, not just retail shelf or sales fl oor.The power shifts again. Suppliers dominated the1980-90s as they pushed product and thrived onnational brand pre-eminence. Retailers dominatedthe 2000s with SKU rationalization, increased privatebrand penetration and fact-based merchandisingdecisions. Consumers will dominate in 2015 as theyincrease demands for interactivity, segmentation,localization and customization, and as they leveragegreater visibility into product availability and pricing.This will require unprecedented levels of value chaincollaboration.The assumption guiding recent decades has beenthat suppliers will do business with fewer retailerswho will carry fewer (inter)national brands. Thedriving assumption for suppliers in 2015 must bethat their large retail customers will operate more butsmaller concepts to meet the needs of more diverseconsumer segments. They will want the suppliersthey do business with to be just as versatile. They willdemand the SKUs they carry convey differentiation andcredibility while delivering profi table sales. With thedecreasing gains from new store openings, retailer andsupplier profi tability will be achieved by driving greaterproductivity within existing stores.11. Almost Perfect Product AccessThrough much of the history of product distribution,a large part of a product’s value has been added atthe factory (in the production stage) and at the store(by making the product accessible). In 2015, we willhave almost perfect product access—availability of theright product, at the right place, at the right price. Theeconomics of scarcity will give way to the economics ofabundance.Consumers will be able to get almost any product theywant. Surplus manufacturing capacity around theglobe will support low-cost product sourcing. Moremanufacturers in developing countries will add reliable,low-cost production capacity capable of producingto acceptable quality standards worldwide—drivingcommoditization of quality. Enduring deflation willkeep prices in check—driven by rapid growth of pricedrivenretail formats, the proliferation of private brands,the rise of the global supply chain and the continuingelimination of trade barriers.Thanks to the Internet and the rapid evolution of searchfunctions and fi lters to connect supply with demand,consumers will be able to fi nd almost any product theywant. Thanks to a range of customization tools andtechnologies, if they can’t fi nd what they want, they willbe able to “create” what they want—especially in digitalmedia, increasingly in “real” world media.12. Pervasive TechnologyTechnology will be pervasive in 2015. Falling costs,widespread availability and adoption of devices,a working infrastructure and standardization willaccelerate the integration of technology. This will drivemore change in the way consumers shop in the next 10years than it has in the last 20 years.www.retailforward.comRetailing 2015: New Frontiers, April 200711

Consumers will have access to devices in home andin hand (Figure 18). Miniaturization will allow mobiledevices to add increased functionality and also alloweveryday items like accessories to function as devices.Biometric technologies are emerging, including facialand voice recognition and fi ngerprint, iris and retinalscanning. Interactions will be increasingly natural, suchas voice activation. Self-activated agents will performroutine tasks without human intervention.Consumers will be able to access content on demand.Information will be available anywhere, anytime, inany language (instant translation). For retailers andsuppliers, technology will empower an unprecedentedlevel of value chain collaboration and communication—from raw material supplier to end user and back again.13. No Privacy—No ProblemIn a world of pervasive technology, the advantage willgo to those who share—especially to those who makesharing worthwhile. Information sharing will reach newlevels: between supplier and retailer, supplier andconsumer, retailer and consumer, and consumer andconsumer. Value chain collaboration will be critical todrive products and assortments keyed to niche marketdemand. Expect security issues to be resolved orprotections provided—at least to the point that mostconsumers will feel the risk of sharing is outweighed bythe rewards. Consumers will share—so long as thereis a good reason to share. If retailers and suppliers donot make sharing worth their while, consumers will baraccess, relying on the plethora of fi ltering mechanismsavailable to close the loop to unwanted solicitations.14. Information OverloadRetailers will be awash in data. The typical retailerwill capture not just product profi tability and store andtransaction data but also customer data and operatingdata delivered nonstop by in-store devices. This willgive rise to new customer-driven metrics, and newmetrics designed to improve the shopper journey andpoint-of-purchase experience. Expect intensifi ed focuson achieving accounting-quality data for customer andshopper metrics.15. Tougher StandardsIn 2015, retailers and suppliers will be held to higherstandards around the globe. Concern about peopleand planet will no be longer a fad or the domain of theactivist few. It will be an integral part of mainstreamconsumer demand around the globe, buffeted by forcesfrom the rising level of government involvement in whatAmericans can consume, to the omnipresence of newsmedia (news travels everywhere virtually immediately),to watchdog groups. Environmental causes willremain front-page news—headlining the rising costof scarce resources, environmental scares such asglobal warming and health pandemics, the hazardsof food and drug contamination, and discovery of the“next thing bad for you.” Further globalization effortswill pose a new set of challenges as retailers needto deal with different—and often stricter—cultures,value systems, legislative environments and reportingrequirements abroad. With pervasive technology,what retailers and suppliers do—how they do it—wherever they do it—will be more transparent to theirconstituencies around the globe.Figure 18Household Penetration of Devices, High-Speed Internet90% 88%2001 200669%57%56%32%11%3%7%17%PersonalComputerMobile PhoneHigh-speedInternetMP3 PlayerPDASource: Forrester Research, Inc.12 Retailing 2015: New Frontiers, April 2007

15 Trends for 2015If these are the drivers, then what are the outcomes?What will the retail landscape look like in 2015?Retail Forward forecasts 15 trends that will redefi ne theretail business environment:1. The Downsizing of (Almost) EverythingExpect (almost) everything except mega-store chainsand formats to downsize during the decade—products/packaging, retail chains, store footprints, living spaces.The sustainability trend will drive the downsizing ofproducts, packaging, resource consumption and waste.More people will look for smaller, more personalizedspaces—both to live and to shop. Accessibility toalmost infi nite choices (at least online) and the growingability for consumers to remix, adapt or create whatthey cannot fi nd will splinter much of mainstreamretailing into smaller niche offers—down to units of one.2. The Glocalization of RetailingFor many big retailers, the next growth phase will beabout segmentation and localization. Big retailers ofthe future will get there by operating multiple formatsand multiple concepts, targeted to specifi c customersegments, in specifi c local markets, for specifi c enduseneeds and occasions, while operating in specifi cshopping modes. Retailers will need to combine globalmarket savvy and sourcing with local market deliveryand know-how.3. Breaking the 80/20 RuleThe future of retailing is selling less of more.Aggregation of small will be the new big. Thetraditional rule of thumb that 20% of SKUs equals 80%of sales will no longer be the rule. In 2015, the other80% of units will represent an increasing share of thesales and a disproportionate share of the profi ts. Withexpanded access, consumers will buy less of what’s“popular” and more of what “suits me.” Retailers thatcan fi gure out how to deliver what niche markets arelooking for will reap the profi ts. “Now you see it, nowyou don’t” (limited editions, fast fashion, customization,et al.) will replace “stack it high and let it fl y” as theprofi table retailer’s mantra.Niche concepts will fl ourish on the Internet, benefi tingeconomically from an environment that effectivelyaggregates far-fl ung, widely dispersed, even globaldemand. More niche retailing will populate the bricksand-mortarworld, as specialty retailers target fi nerniches with bigger portfolios of smaller footprint, smallerstore count, more narrowly focused concepts. Fresh,new resources will fi nd routes to market in alternativevenues that emerge to showcase the latest trends(rent-a-stall/case, designer fl ea markets, roving trunkshows, store-in-store) and, of course, via the Internet.4. The Unchaining of RetailingSize does not equal success in 2015. We will seethe demise of the cookie-cutter specialty chain. Theday of the 1,000-outlet specialty chain delivering thesame homogenous, narrow and deep assortmenteverywhere, regardless of location, is over. Chain sizewill top out at lower store counts. Retailers will expectto achieve more of their growth from new conceptsthan from established concepts. The new specialtymega-retailer will comprise an ever-evolving portfolio ofconcepts that are fl eet of foot and always keep a fi ngeron the pulse of consumer segments. Specialty retailingwill be reincarnated by going back to its roots andgetting closer to the customer.To spur growth, many specialty retailers will implementextension strategies that help maximize customervalue and leverage organizational skills—e.g., a seriesof lifestage concepts designed to sustain a lifelongrelationship with the customer (and his/her progeny);new product and service concepts that help serve all ofa customer’s lifestyle needs; or concepts that leveragelifestyle/stage expertise and capabilities at differentprice tiers.5. Global Consolidation of Big Box RetailersBig box retailing doesn’t go away in 2015, but expectto see even greater concentration of market shareon a global scale. Those players that remain afterconsolidation will be stratifi ed by price tier and lifestyle.They will position strategically as share of life portfoliosdesigned to meet target customer lifestyle or lifestageneeds inside a single box. They will target modularfl exibility inside the box and multi-channel reach aroundthe box. They will operate multi-format extensions ofthe box to meet different customer needs, occasionsand shopping modes.www.retailforward.comRetailing 2015: New Frontiers, April 200713

6. Share of Life RetailingRetailers will defi ne themselves by the customers theyserve, rather than by the products they sell. Retailerswill grow by positioning as more than just purveyorsof “stuff” but also as one-stop purveyors of lifestylesor need states. Service offers will help bring thebrand experience to life. The new one-stop shop willfocus on customer segments with edited assortments,simplifi ed choices (eliminating the “tyranny of choice”),and new combinations of goods and services. Doit-for-meservice and solution offers will surge asretailers strive to capture a share of the growth inspending on services. Service offers will help bufferretailers from falling margins as products become morecommoditized and price-competitive. More retailers willleverage their brand license into the realm of services,making the next concept in their portfolio one that sellsservices, not products. More retailers will emphasizeend-to-end brand experiences—encompassing prepurchase,point-of-purchase and after-purchase. Theywill target not only ease of shopping but also ease ofuse.7. The “Un-storing” of RetailingIt will get harder to answer the question “what’s a store”—much less “what’s in a store.” Multi-channel willmultiply—covering more than stores, catalogs and anonline presence—and come to mean a bigger, broaderbrand presence. Distribution and marketing models willproliferate. Harbingers include pop-up stores, virtualstores, and retailers partnering with service/experiencepurveyors (e.g., spas, cruises, hotels) or developingtheir own. Stores as we know them increasinglywill exist primarily to provide brand experiences andimmediate fulfi llment. The defi nition of “store” willexpand—encompassing inventory-less stores, “endlessaisle” in-store kiosks that customers can shop forextended product lines and hard-to-fi nd SKUs, drivethroughsand touch-screen windows that take orders,store-within-a-store retailers that live in host facilities,retailers that sell services (not stuff), and more.8. The Rise of the Anchor PlaceLike the store of the future, the shopping center ofthe future will be closer to the customer. We will seethe demise of the anchor store as the main draw.The place becomes the destination. New generationlifestyle centers will offer the ultimate in simplifi cationand convenience—a “pre-packaged total lifestyleexperience” where busy consumers can shop, work,socialize, eat, be entertained, live. New tenant mixesand anchors will focus on customer lifestyles, not justcustomer shopping styles. These centers also willprovide a sustainable (cost-effective, resource-effi cient)response to the land-use dilemmas of the future—whenanticipated population growth will outstrip availableland mass if suburban growth continues in the currentmode.9. Consumer as Co-creatorThe line between maker and consumer will blur.Consumers will have almost limitless opportunity toget what they want by participating in the value chainas creator, co-creator, adapter, editor, re-mixer andre-packager. Unprecedented levels of customerconnectivity—pre-manufacture, pre-shop, whileshop, post-shop—will actively engage consumersin the development and customization of their ownproducts, media and shopping experience. Wewill see more customer-driven R&D, more masscustomization, more personalization and more onsite“manufacturing.” Personalization will thrive in thedigital world, unhampered by time and materials costs;but more and more brick-and-mortar offers will benefi tby incorporating personalization options into the mix,as well.10. Exclusivity EscalatesPenetration of private brands and manufacturerexclusives will explode across virtually all categoriesas retailers require differentiation, versatility, newnessand return on inventory investment. Private brands willbe key as retailers strive to satisfy niche opportunities,enable customization and keep pace with heretoday–gone today trend lifecycles. Umbrella brandswill enable retailers to put their stamp on an expandedrange of product and service offers. More retailers willinvest in vertical end-to-end supply chain capabilitiesor require seamless virtual supply chain capabilitieswith manufacturers when it doesn’t make sense to do itthemselves.11. Suppliers Defend TurfIn 2015, suppliers will live by two credos: “The bestdefense is good offense” —and— “If you can’t beatthem join them.” Supplier-retailer relationships willbe increasingly collaborative but also increasinglycompetitive. Branded supplier-retailer partnershipswill multiply but so will retailer private brands. Moreretailers will use or license brands to convey credibility.More suppliers will work vertically with retailers onunique brand and product offers—sourcing throughselling.14 Retailing 2015: New Frontiers, April 2007

Suppliers will gain back some of the power they haveceded to retailers in the past decade. With the Internet,consumers will have visibility into the full supplieroffer—not just what is on the retail shelf—de factoemerging as the ultimate consumer-pull strategy. Thenext step for suppliers will be to provide consumeraccess—anything they can see they can buy. Somewill go supplier direct. Some will work with retailers toensure the products consumers want reach the retailshelf (real or virtual). Also expect more suppliers to setup shop as retailers—although the retailer will neverbe completely disintermediated in some categories,such as groceries, where product aggregation iscritical to shopping experience and effi ciency. It will beincumbent on suppliers to engage consumers to buildbrand and product relevance.12. Power to the PeopleTools and technology will change the balance ofpower in retailing, shifting the power to the people.Consumers will have almost perfect informationaccess about products and pricing. It will be almostimpossible for retailers and producers to maintain asignifi cant difference in margins on widely distributedcommodities, underscoring the importance ofdifferentiation, innovation, and integrated lifestyleapproaches to doing business.Consumers will wield clout through social networking,value chain involvement and aggregation. Expect tosee the reincarnation of group buying—not for B2B,but for B2C. Expect consumers to want almost perfectproduct access—what they want, when they want it,in the size they want it, at the price they want to payfor it, at the place they want to shop for it. If they can’tfi nd what they want, they will expect the opportunity toconceive or create it.13. New Technological EnvironmentTechnology will pervade the living and shoppingexperiences of 2015. Most of the technology trendsanticipated for 2015 are progressions of trends that areunder way today; they will just be more ubiquitous—tools and technology within reach wherever, wheneverand for whatever purpose.Consumers can expect to shop location-free—viawireless broadband, wireless devices and instanttranslation. They can expect to shop interventionfree—viadigital homes, networked appliances,automatic replenishment, man-machine interaction anddevice-to-device communication. Social networkingwill evolve into profi table business models that giveconsumers more control over what retailers sell andwhat suppliers make.Technology will help customers enjoy a morepersonalized shopping experience via customizationoptions, fi t/size scanners, and fi tting rooms outfi ttedwith touch-screen connectivity to request different sizesor items, social networking via live video and virtualtry-on options. In-store technologies will help createa more effi cient and engaging shopping experience,via such options as holographic sales assistance,smart carts, product and information access kiosks,interactive digital media and messaging, biometrics andother forms of instant payment.Also expect the emergence of location-basedadvertising that will tap into prospective customers ona permission basis, based on knowing their locationthrough their mobile devices. Companies will be ableto send consumers relevant offers while they are enroute and drive measurable sales.14. Value Chain EvolutionToday’s value chain is designed for massmerchandising. The value chain of 2015 will need tosupport niche merchandising, down to the location, daypart and customized individual unit. It will be defi nedby connectivity, early capture of true demand signals,total visibility, shared data, real-time information,real-time response, decentralization and integratedshared logistics. It will enable much clearer insightinto true demand via the proliferation of interactive“Choiceboards” designed to help consumers see andselect from the full extent of product options available.We will see a transition to “true demand” (what thecustomer wants vs. what the customer was forced tobuy) and a transition to lean consumption (minimizingwaste by producing to demand).15. Triple Bottom Line ScorecardRetailers and suppliers will need to become betterglobal citizens. In 2015, the defi nition of corporatesuccess will take into account environmental and socialperformance in addition to fi nancial performance.Retailers and suppliers should expect to be measuredagainst an expanded set of criteria—planet and peopleas well as profi t. Companies will be evaluated on howwell they meet the needs of a wide variety of globalstakeholders—customers, employees, suppliers,investors, communities and regulators. They willbe judged on how well they manage and conserveincreasingly scarce resources and how effectively theymeet rising safety and wellness standards.www.retailforward.comRetailing 2015: New Frontiers, April 200715

Managing Complexity in 2015What must retailers and suppliers do to succeed in thenew landscape of 2015?Recent history focused on effi ciencies in the formof technology, operating strategies and sourcingstrategies. This is a fundamentally mature strategy,with most companies at parity. It is also fundamentallya mass marketing strategy.The challenge for retailing in 2015 will be to managecomplexity and diversity—businesses that span theglobe while reaching out to the niche of one.This will require focus on a new set of strategiccapabilities and solutions:Shopper InsightsUnderstanding shoppers will be more critical thanever in 2015. Given the anticipated growth of nicheretailing, the diffusion of media and markets andthe increasing reliance on point of sale as point ofcommunication, shopper insights captured in the retailenvironment will be key to driving sales. Retailers willneed to understand what motivates the shopper at thepoint of sale. Suppliers will need to work with retailersto determine exactly where a product fi ts within theretail mix—and how that product will help drive salesand profi ts.Understanding consumers is not the same asunderstanding shoppers (Figure 19). Conventionalconsumer research typically focuses on who isshopping for which products and where. Shopperinsights research is about understanding the needs,attitudes and behaviors of customers in shoppingand buying mode—why the shopper buys (or doesnot buy), why certain items were purchased (and whyother items never had a chance) and how the shoppingexperience affected the buying decision.Figure 19The Shopper Insights ProcessBrand equitypre-dispositionResearch byshopper expertsPropensity to purchase canpotentially be impacted ateach stage of journeyShopper typeType of occasionState of mindChannel choicePre-planningRetailer choiceRetailer experienceStore layoutStore dynamicsStore atmosphereShopping styleShopping basketShopping routeIn-store advertisingShelf layoutSignagePromotionsPack standoutPack communicationResearch byconsumerexpertsConsumption experiencefeeds back into brandequityTransaction sealspurchase decisionSource: TNS Retail and Shopper Insights16 Retailing 2015: New Frontiers, April 2007

Data AnalyticsDuring the next decade, retailers must learn to wieldthe customer databases they have been buildingas powerful customer knowledge, marketing andmerchandising tools (Figure 20). With the growthof niche retailing and the proliferation of customertouch points, retailers will have more data points thanever. They will need to harness this information todo business in ways that are customer-centric ratherthan operations-centric. Sophisticated data analyticswill help retailers and suppliers mine shopper wants,needs and purchase histories in order to provide morepersonalized, relevant offers to the shoppers. It willhelp retailers and suppliers mesh multiple sourcesof shopper information to identify correlations andpatterns for strategic decisions.InnovationInnovation is the one true sustainable driver of growth.Too many companies have focused on making betterproducts, when real advantage comes from makingdifferent products and better product experiences.Effective innovation integrates an understanding of howconsumers live, how they buy and how they use theproducts they buy (Figure 21). In 2015, trends are heretoday, gone today. As product lifecycles grow shorter,the need to innovate will intensify.Innovators in 2015 will replace mass productionwith extremely limited production, extremely limitedavailability and rapidly evolving portfolios of extremeniche concepts. They will offer new combinations ofproducts, experiences and services that let shoppersexpress themselves. Increasingly, innovation willtake place at the point of purchase, by enablingcustomization and personalization.Trend identifi cation becomes a critical success factor.Trend-spotters will need eyes where the action is—online, where fi lters help point to the next trend; onthe ground, in emerging markets of infl uence; and viaengagement marketing, to actively solicit input fromconsumers.Figure 20The Data Analytics ProcessRetailer Data Warehouse• POS / transaction• CRM / loyalty / credit card• Advertising / promotionaleffectiveness• Traffic and shopping patterns• E-mail and electronic dataData Analytics• Identify correlations and patterns for strategicdecisions• Perform cluster and factor analyses• Perform basket and price-sensitivity analyses• Score customers on value and behavioral dimensions• Score customers based on cross-sell, up-sell anddefection probability• Assess promotion and campaign ROI• Divide customer base into actionable, discretesegmentsOther Data Sources• Demographic overlays• Shopper insights research• Survey research• Geographic informationand trade zone maps• Vendor partner databasesStrategic Decisions• Customer segmentation• Customer optimization / retention• Assortment optimization / micro-merchandising• Channel optimization• Format, store layout and banner optimization• Customer acquisition• Price zones based on sensitivitySource: TNS Retail and Shopper Insightswww.retailforward.comRetailing 2015: New Frontiers, April 200717

Shopper ExperienceIn an era of almost perfect production and almostperfect accessibility, especially in developed markets,experience, like innovation, will drive retail value. Inemerging markets, expanding accessibility driven bymodernization of retailing will continue to add value.Customers today usually don’t want (or need) a betterproduct—they want a better shopping or productexperience. Companies will need to focus on howcustomers ultimately feel about themselves in theirinteraction with the shopping environment, product,service and brand (Figure 22). This is a result of theend-to-end brand experience:●●●●Figure 21InnovationTransactions RelationshipsLOYALTYMANAGEMENTSEGMENTATIONProductsSource: TNS Retail and Shopper InsightsPre-shop—how effectively the customer is engagedShop—ease, enjoyment and relevancy of the retailoffer and environmentPurchase—ease of transactionPost-purchase—ease and enjoyment of use,satisfaction of expectationsLast-Mile SolutionsRELATIONSHIPMANAGEMENT• Solve Problems• Manage Part(s) of LifeManaging theWhole House• Brokerage• Finance•Design• Construction• Maintenance• Insurance•UtilitiesVALUE INTEGRATIONSolutionsGetting it there gets harder in 2015. Superiordistribution will help defi ne retail success in an era ofglobal reach, niche retailing and accelerated lifecycles.Sales of customer-targeted niche products and ofcustomized and personalized products should be moreprofi table in the long run, but only if sellers can getniche purchases to the customer effi ciently—or givethe customer a reason to pay for them. In a digitaldistribution model, the cost of getting a product to theconsumer falls precipitously (approaching or evenreaching zero). But in a physical distribution model, thedelivery costs and time constraints remain. Betweennow and 2015, expect a boom in rapid delivery serviceoptions. Also expect a groundswell of alternativesincluding fi nely targeted niche concepts, micromerchandisingand onsite customization.SpeedToday is too late in 2015. In an era of extremelyreduced cycle times, shorter time to market becomesa critical success factor. Retailers and suppliers willneed to use predictive tools to stay ahead of the curve.They will need to identify and act on trends early. Theywill need to get into trends quickly—and out of trendsmore quickly.Small-Scale EconomiesFor most of the history of retailing, scalar economyand scalability have referred to the effi ciencies ofmass production and retailing. In 2015, they will needto refer to effi ciencies of niche production and nicheconcept operation—down to the single unit. Unitproduction will burgeon in the digital world, unrestrictedby time, material and delivery costs. Ability to achieveeconomies of small-scale operation and individualproduction increasingly will help defi ne success in thephysical world.Risk Management“Stuff” happens. Data security breaks, productcontamination, workplace accidents—the possibilitiesare endless. In a networked world, when somethinggoes wrong, bad news spreads quickly. Companiesneed to be prepared to control their responses touncontrollable situations.Additionally, as many retail organizations willbe composed of multiple concepts, retailers willincreasingly need to think of these concepts aselements of an investment portfolio that need to beactively managed throughout their lifecycle in order tomaximize ROI and minimize risk.18 Retailing 2015: New Frontiers, April 2007

Figure 22Retail Value CurveTraditional Retail Value CurveInnovation• Features• Fashions• Functions• Customization• Personalization• Self-expressionProduction• Speed• Quality• ConsistencyAccessibility• Effort• Selection• PriceExperience• Shopping• Buying• Using• EmotionalconnectionsValueAdded…at the rightplace and at theright priceValue was added bygetting the rightproduct to the rightcustomer at the righttime …2015 Retail Value CurveInnovation• Features• Fashions• Functions• Customization• Personalization• Self-expressionProduction• Speed• Quality• ConsistencyAccessibility• Effort• Selection• PriceExperience• Shopping• Buying• Using• EmotionalconnectionsValueAdded…and improvingshopping and enduseexperiencesand connectionsValue is added byinnovating toincreaserelevancy…Relevancy …Source: TNS Retail Forwardwww.retailforward.comRetailing 2015: New Frontiers, April 200719

Financial FlexibilityExpect privatization to replace IPOs as the fi nancialstrategy of the decade. Retailers and supplierscan expect to be under more scrutiny from morestakeholders in 2015. Traditionally the public eye hasnot looked kindly on change and experimentation.Whether because more retailers are approaching theend of their rollout runway or because fewer companieswill try to roll out new concepts rapidly in cookiecuttermode, expect fewer IPOs. Many retailers willgo private, as they seek to avoid scrutiny and gaingreater fl exibility while downsizing chains, waxing andwaning new concepts to meet demand trends, andtransforming on a regular basis.Triple Bottom Line AccountabilityCorporate eyes are opening to the triple bottom line(people, planet, profi t) accountability challenge. Itis the accounting that remains a hurdle. The costsare defi nable, but the return on investment is harderto quantify. In an era of increased transparency andscrutiny, retailers and suppliers will need to focus notso much on the cost of operating responsibly but onthe cost of not doing it. The intangible benefi ts ofthe triple bottom line are clear—improved corporatereputation, enhanced brand equity, higher employeemorale, increased customer goodwill. But, whereverpossible, companies also must demonstrate thedirect connections between new sustainability andstakeholder initiatives and increased savings, salesand profi ts.Managing ComplexityManaging complexity will be the key to doing businesssuccessfully in 2015. Retailers and suppliers will bemore global, more diverse, and operate across morechannels.Companies will need to think big but act small.Management will need to evolve to a more distributedmodel—managing across geographic, cultural,legislative and regulatory boundaries; respondingto local tastes, customs, traditions, lifestyles andeconomies. Management will need to be fl exibleand responsive—move quickly, partner to extendreach, focus on core capabilities, outsource non-coreactivities. Management will need to be situationsensitive—tothe needs, wants, tastes and preferencesof a wide variety of stakeholders inside and outside thecompany.It will be critical for management to embracetechnology:●●Technology to extend reach—no longer willretailers need a physical footprint to have marketpresenceTechnology as fi lter—“hearing aid” to what shopperniches are looking for, conduit to the next best thing20 Retailing 2015: New Frontiers, April 2007

Retailing 2015The OutlookFor companies that can manage complexity andrespond to market forces, 2015 will be a time oftremendous growth opportunities. The companiesmost at risk will be the incumbent leaders—ifexploitation of existing opportunities causes inertia onnewly emerging opportunities.In 2015, the market will talk to the retailers andsuppliers that tune in:●Consumers will tell you what they want—if youknow where to listen.●●●●There are more places to listen to consumers andspot trends.There are more tools and technologies to enablemore focused responses.There are more ways to reach consumers.There is greater opportunity to be specifi c,individualized and relevant.www.retailforward.comRetailing 2015: New Frontiers, April 200721

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