The Retailer Winter edition_2020

Market insights and trends

Tomorrow’s retail trends: Lessons from the global marketplace

SUKHJEEVEN NAT HEAD OF RETAIL & WHOLESALE SECTOR Santander

WHAT CAN UK BUSINESSES LEARN FROM THEIR COUNTERPARTS AROUND THE WORLD ABOUT ANTICIPATING AND EXPLOITING NEW DEVELOPMENTS IN THE RETAIL SECTOR? The UK’s retail sector has undergone dramatic transformation in the past few years – and the rate of change shows no sign of slowing. The biggest challenge facing retailers today, therefore, is how to put in place a strategy and organisational model that can both anticipate and take advantage of the trends of tomorrow. At Santander, we’ve gained deep and valuable insight into these trends, as well as the best practices employed by the most resilient and successful businesses. Some of these insights come from the trade missions we organise to markets all over the world. After all, Britain isn’t alone in its experience of upheaval: all global markets have seen significant changes in consumer behaviours, with expectations of retailers now far higher than ever before. These changes have been driven primarily by technological advances and increasing connectivity.

From the four Cs to the four Es To put these developments in context, it’s useful to look at the three key cycles of market disruption that have occurred up until this point, each of which has prompted retailers all over the globe to adapt their business models. • In the more distant past, we saw the ‘age of efficiency’, during which businesses focussed on supply chain improvements such as just-in-time distribution systems as well as retail models like standardised flowing stores. • This was followed by the ‘age of experience’, where consumer demand for instant gratification was fuelled by the rise of social media and related ideas ranging from FOMO (fear of missing out) to ‘Instagrammable moments’. • Today, we’re seeing the emergence of a trend that can best be described as the ‘age of belonging’, where the most important drivers for consumers’ purchase decisions have become concepts such as community, sharing and a sense of purpose. Retailers are already starting to rethink how they can make the shopping experience more personal and create a greater sense of place and social interaction.

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