The retail industry is going through some big changes these days. With many recent store closings and a general shift in focus to online access to goods and services, it’s clear that the rise of mobile shopping and increasing number of bargain-hunting consumers have led to the transformation of an entire industry.
Especially in the last quarter, clear winners and losers are emerging as technology evolves and people change their spending patterns.
Here are some of the latest shopping trends happening right now and what it all means for you and your wallet!
Read more: 12 of the best and worst outlet stores
6 big changes happening in the retail industry
1. Store closings
As a result of more online shopping and shoppers who aren’t willing to pay full price, many retailers have had to cut operations or close stores altogether.
The following retailers have closed or are planning to close a significant number of stores this year:
- American Eagle
- Children’s Place
- Finish Line
- Jos. A. Bank
- Men’s Warehouse
- New York & Company
- Office Depot
- Sports Authority
- Wolverine World Wide
Other store closings include Macy’s, JC Penney, Barnes & Noble, Gap, Hancock Fabrics, Staple’s, Pier One and Target. All of these combined add up to about 2,500 stores that will close this year or next.
Though this might strike a chord of sadness if you see your favorite store on the list, one benefit to brick and mortar store closings is if the company decides to keep its online business strong, it could provide you with added convenience and possibly a better deal when you shop online.
Read more: 11 retailers closing the most stores in the U.S.Ã¢â‚¬”¹
2. The rise of online shopping
Q1 retail e-commerce sales were just released by the U.S. Census Bureau on Tuesday, and retail sales continue to climb, climb, climb.
Case in point: Amazon. The company continues to post year over year growth of at least 20%. And, compared to other brick and mortar stores, it’s a bit of an anomly when it comes to growth.
Just check out the below chart from The Motley Fool comparing Amazon to Bed Bath and Beyond, Best Buy, Walmart and Macy’s. Clearly, it’s an outlier, thanks to the Internet.
Retail stores that are suffering would be wise to follow Amazon’s online example.
Though department stores like Macy’s are really struggling as of recent with sector earnings falling 48%, Walmart posted a 1% rise in quarterly revenue and its shares jumped 9% today, according to the Wall Street Journal. Part of the reason may be due to changes by Walmart to become more competitive online. Walmart is opening more distribution centers to facilitate quicker delivery for online orders and is also planning to offer a mobile payment feature within its app by the end of June.
3. Rise in mobile shopping
Mobile shopping increased by $18 billion last year, and is only expected to increase.
Customers also appreciate shopping in a mobile app too. According to Nielsen, 89% of people’s activity on their mobile device is within an app, and according to ComScore, mobile is ‘eating brick and mortar‘ — or rather, the ability to comparison while in a store on a mobile device is putting a lot of pressure on brick and mortar retailers, who have more overhead they have to pay for such as staff and retail space.
4. Shift from full price shopping to bargain hunting
There has also been a shift in what people expect to pay when they go into a retail store.
Before the recession, it used to be that more people were accustomed to paying full price for a retail item, such as clothing, shoes or home goods. Then the recession hit, and people were looking to cut corners wherever they could, and their fun money budget shrunk. As a result, retailers dropped prices in order to keep the sales coming in.
Also during this time, deal sites cropped up, offering people the lowest prices on consumer goods.
Now that we seem to be on the other side of the great recession, people still expect a great deal when they go shopping, forcing retailers to evaluate how they do business.
For example, while Gap, Guess, and Aéropostale seem to be struggling, H&M and Forever 21 are doing much better, with cheaper prices and ever-changing offerings. In fact, The Motley Fool reported 19% sales growth for H&M last year, while Forever 21’s revenue increased 16%. Stores like Lord & Taylor, Macy’s and Kohl’s are also diving into the outlet store model to attract the bargain shopper market.
5. The rise of ‘so cheap you can’t believe it’ shopping
Stores like Ali Express, Wish and Hollar offer prices so low, you’ll wonder if they’re really real. But these prices are no joke: Though your items may be coming from China, you’ll pay up to 90% less than you would for the same item in brick and mortar store. Though we can’t vouch for the quality, one thing is for certain: These stores are CHEAP!
6. Certain kinds of brick-and-mortar stores still excelling
Before you say that brick and mortar shopping is dead, don’t think too fast: There are retail segments where brick and mortar retail is growing — and thriving. Stores like T.J. Maxx, Marshalls and HomeGoods reported better-than-expected results this quarter. Additionally, home improvement stores and grocery stores are doing well.
How to get the best deals
In addition to shopping the discount stores like T.J. Maxx and Marshalls, where you’re sure to find a deal, you’re likely to find the best deal by using a tool that is right at your fingertips: Your smartphone. Be sure to always price match, and, if you’re brave, find deals on those so-cheap-you-can’t-believe-it sites that offer incredible bargains. But fair warning: Make sure the online store is reputable. Many online retailers that are luring in bargain-hunting shoppers end up being scams, so be sure to research the company you’re buying from in order to protect yourself.
Also, try shopping on a desktop computer in addition to your phone. Retailers may change prices based on the kind of device you’re using to shop. In fact, when it comes to travel, the price is higher on a phone! So, it pays to price check on different devices to ensure you’re getting the best price.
Don’t shop at just one website or with just a single device if you’re trying to save money. Though it may be annoying that prices vary online versus in-store for the same item, in order to get the best price, you have to shop around.
Additionally, shop daily deals sites. These sites can offer exclusive and unique bargains not found anywhere else, and if it’s something you need, you might be able to score a great deal! A quick Google search for a coupon or promo code is also a great way to save on something you need. You can also check out our new Clark Deals website that offers the best daily deals from around the web!