US Retail Marketing Trends and Outsourcing Services - Invensis

8 Retail Marketing Trends in US: Ideas, Strategies & Stats

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Retail Marketing Trend in United States

Inspite of the extreme weather conditions witnessed in February around the country, retail sales in the US grew by a seasonally adjusted 0.3%, reported USA Today. With anticipations of a better pace of job growth, personal and household income is expected to increase, fueling consumer spending further. 2014 will see a 4.1% increase in retail sales, estimates the National Retail Federation; this would be a 0.4% increase compared to 2013. Online retail sales are expected to increase between 9 and 12% this year.

The US retail market is a mammoth money-spinner, contributing USD 2.5 trillion to annual GDP and employing 42 million Americans. As its companies vie for a share of their consumers’ business, they need to ensure that they are with the times with some of the trends that will drive customer expectations, purchase and satisfaction, and, ultimately, growth.


How outsourcing can help retailers to get an edge

Capitalizing on the above-mentioned trends requires dedicated focus from retailers, in terms of human resources, skills and technology. The key points of consideration for developing capabilities within the organization are:

• Looking out for a skill set to match a business requirement• How quick the skill set can be developed in-house• The costs of implementing the service in-house

Several companies in the retail industry have benefited from outsourcing back office requirements in logistics, finance, marketing, IT and customer care, in order to streamline their operations and get a competitive edge. The particular aspects of the trends that can be outsourced are: • Data Analytics• Logistics• IT Services


1. Use of Social Media on the Rise: Vision Critical, a provider of insight communities, conducted a survey on social purchasing behavior, with approximately 6,000 respondents over 17 months (from February 2012 to June 2013), in the US, Canada and UK. Titled ‘From Social to Sale’, the research found that 38% of Facebook users bought an item after commenting, sharing or liking a post about it; 22% of Twitter users purchased the item after tweeting or re-tweeting about it; and 29% of Pinterest users splurged on the item after pinning, repinning, or liking it on the social network.

Evidence like this strongly indicates that brick-and-mortar retail brands need to have an engaging and well-targeted social media strategy in place to be able to drive online and offline sales.

Top 8 Latest Trends in US Retail Marketing


2. Increased Use of Mobile Devices: Deloitte advocates that with increasing smartphone usage, retailers have to think beyond just providing a mobile-optimized version of their site and mCommerce. With personalization being the new retail buzzword, a more customized and relevant in-store shopping experience centered on the brand’s app or website can result in improved loyalty among customers.

Different retailers are experimenting with diverse ideas for the mobile. Patagonia, a designer of outdoor clothing and gear, offers customer ratings, product reviews and carbon footprint information in its mobile app. Retail giant Target Corp allows its app users to make shopping lists and find which stores stock the products they want; in February 2014, Target also released a new mobile app game in partnership with Nestle’s Purina PetCare Company.


3. Increased Use of Data and Analytics: As consumers engage with retailers through diverse channels, including in-store, online, social and mobile, a wealth of data about demographics, purchase history, nature of interactions, and other aspects of behavior and trends becomes available. The management of this data is critical to be able to capitalize on it. Data and analytics has, thus, come to play a key role in understanding shoppers better and creating smarter, personalized retail experiences for them.

For instance, Forbes.com reports that Vera Bradley, the handbag retailer, was able to bring positive results to its business through big data analytics. After switching from sending blanket email promotions to targeted emails, based on the purchases made by individual buyers, Vera Bradley witnessed a 275% increase in the conversion rates of browsers to purchasers, by sending 63% fewer mails than it did earlier.


4. Adoption of Cloud Computing: Several large companies around the world have turned to the cloud to host their business applications in order to have easy access to data and reduce infrastructure costs, among other reasons. Cloud computing helps retailers to streamline their channel operations; leverage merchandising, marketing and personalization opportunities; manage their supply chains; and enhance sales, service and support.

According to KPMG’s ‘Retail Industry Outlook Survey 2013’, out of 101 senior retail executives, 39% of the respondents had already adopted cloud in their business operations, 29% of them were planning to adopt cloud computing, and 32% had no plans or could not use or did not know about cloud computing.


The survey also questioned respondents about the potential impact of the cloud on their business model or operations. The findings are depicted below:


5. Use of Social Media on the Rise: Following the trend set by e-tailers like Amazon and eBay, the service of ‘same day goods delivery’ is being used by US retailing giants like Wal-Mart, Home Depot, Barnes & Noble and Nordstrom. While the service does generate additional costs and comes at a fee for customers, it is believed to be useful to keep customers from turning to e-commerce companies for their requirement.

McKinsey expects to see third party distribution services expand, and investments in distribution infrastructure could increase as well.

6. Combating Showrooming: Showrooming refers to customers researching a product in-store and then buying it online at a cheaper rate. Retailer are trying various ways to bring the customer back to the store for the purchase. For instance, Best Buy offers price matching, if its competitor lies within a 25-mile radius.


7. Innovative Ideas: Out-of-the-ordinary marketing ideas are as important as they ever were, to engage the interest of consumers who are being flooded with advertising material all the time across different channels. Furniture retailer Coco-Mat showed its creativity when it allowed customers to take a nap in beds for a couple of hours, without obliging them to buy those after trials. This try-before-you-buy campaign enabled the brand to pass on more information to its customers and increase footfalls.

In order to enhance the shopping experience for their male customers, US clothing store Hointer added QR codes to their jeans. As a result, the desired size was delivered to the changing room, ready to be tried on, saving the customer time and energy from having to go through racks or piles of clothing while looking for the correct fit.


8. Opening More Outlets: According to the ‘2014 Outlet Tenant Report’ from Value Retail News which was released in February of this year, there are 368 outlet chains in the US and 12,796 outlet stores.

• The report throws lights on the expansion plans of retailers:• 158 chains operating through 8,969 stores are planning to expand• 59 chains said that they will open 1,843 stores; on an average, 6 new stores per chain• 36 chains are interested in adding 20 new stores

The report says that in line with their long-term strategies, retailers find value in allocating capital to the outlet distribution channel which is either the most profitable business unit or amongst the most profitable.

Retailers are also experimenting with non-traditional formats of outlets, such as pop-up stores, during the holiday season or as part of their business model to reach out to new customers.


In conclusion, the trends described above reflect the rapid developments in technology that retail organizations need to leverage, and the evolution of consumer behavior that they need to adapt to. By focusing on these trends, and outsourcing non-core functions to trustworthy experts, retailers can bring about efficient streamlining of their operations, improved customer service and satisfaction, and an increase in what could be the greatest prize of all – customer loyalty.

Retailers can compete with new entrants in a better way and focus on core competencies by outsourcing their requirement to a leading service provider.

Experienced outsourcing companies offer round-the-clock service, which will help in providing a better quality of customer service.

US Retail Marketing Trends and Outsourcing Services - Invensis

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