Top five Vermont retail trends for 2013

by Tasha Wallis The retail sector has been in a heightened state of change since the start of the Recession over five years ago. Customers, with the world at their fingertips, are more in control than ever before. So even though Niels Bohr reminded us that ‘ prediction is difficult, especially about the future,’ here are the top trends that will shape retail in Vermont over the next year.
1. The Customer is Royalty.
It’ s obvious that customers are important and that the customer is always right. However, this truism has acquired even more power for two reasons. Customers have many more buying options as well as access to much more information. They can shop where, when (that means 24/7) and how they want. And guess what? They do.
Thus 2013 will see Vermont retailers working even harder to engage customers. Excellent service, quality products, and connection to the community will become just the ante to be in the game. Successful businesses in the coming year will look for, and find, new ways to excite, engage, and retain customers.
2. Technology Matters.
It’ s also self-evident that technology matters, more now than ever. Some local Vermont stores are excellent at engaging their customers on the internet. Many are also creating websites, and venturing online to Facebook, Twitter and Pinterest. However, a quick review of Vermont websites shows that not all are formatted for mobile or tablet use. One Google study showed that clicks on tablets increased significantly on holidays such as Labor Day and Thanksgiving. Stores that can’ t accommodate such interaction will lose sales to those that can.
A respected marketing expert has said that a business’ s website is its most important asset, more vital even than the telephone. It’ s true. Today, chances are that a business’ s website will be the first thing a new customer seeks out. Their advantages are legion. Websites are open 24/7, allow customers to browse easily and at leisure, make purchases without pressure or distraction. Even so, there are many Vermont stores still without any online presence, relying on a couple of phone lines, email, and the fax machine. Increasingly, they constitute an endangered species.
Colloquy, a global marketing research firm, has coined a name for small stores that create a strong local brand identity, engage with customers, and compete with larger stores online. These stores are called Mompopolies and are often the strongest local brands. Marc Sherman’ s very successful Outdoor Gear Exchange in Burlington is one striking example. Farther south, Sam’ s Outdoor Outfitter’ s is another.
In order to compete, in 2013 small Vermont retailers will follow these leaders, taking fuller advantage of social media, mobile devices, and their websites.
3. We are all connected.
Local stores can be rapidly affected by national and global events. Ask any retailer who worried about the fiscal cliff and Congressional action when trying to predict holiday sales. Colloquy’ they know a good turn of phrase -- calls this phenomenon Glocalism and describes it as ‘ the butterfly effect on fiber optic wings.’
One recent example: retailers everywhere, including Vermont, were on tenterhooks trying to understand how a possible strike at some US ports might affect their ability to receive and replace inventory in a timely fashion. More generally, retailers are hugely dependent on consumer confidence. Always fickle, that confidence can now be swayed, instantly and globally,by anything from a debt ceiling standoff to unrest in the Middle East. This has always been true, of course. But in today’ s world of constant access to light-speed communication, distant happenings will have faster and more pronounced impacts close to home. The trend: Vermont retailers will monitor global events more closely than ever before, not just because they can, but because they must.
4. Buy Local is Hot.
Vermonters care passionately about their communities and their downtowns. After years of economic uncertainty, they are more sensitive than ever to the fact that quite often their neighbors are also their local retailers. Thus this past holiday season, communities throughout the state worked hard to celebrate their own retailers. Morrisville, to cite take just one example, had signs in many stores thanking shoppers for shopping locally. In addition, many downtowns and small businesses pulled out the stops to promote Small Business Saturday just after Thanksgiving. Many businesses on Church Street in Burlington offered special Small Business Saturday promotions.
As a result, in 2013 more communities, stores and organizations will reach out more often and more creatively, to consumers based on town, state or regional identity.
5. Everybody Loves a Discount.
Five long, hard years for retail have trained customers to expect discounting. According to news reports, over the recent holiday season, many more consumers than usual held onto their dollars until the last minute, waiting for prices to drop. And it’ s not just holidays. Large stores like Best Buy feel ever-increasing pressure from consumers using mobile phones to compare prices in the stores. Some vendors on Amazon are already using sophisticated software to vary their prices based on a whole range of consumer variables, much like the airlines and hotels have done for decades.
In fact, a study by eMarketer showed consumers expanded their use of mobile in all areas of shopping, from searching for products to using mobile coupons, from 2011 to 2012. That’ s a trend in itself, of course, but it produces an even more potent one: discounts are no longer considered the exceptions. In light of this new reality, in 2013 customers’ expectations about discounts will only intensify. Vermont retailers will need to adjust with loyalty rewards, online price matching, mobile coupons, more frequent good, old-fashioned sales, and other ingenious tactics still hiding in imaginations statewide.
Tasha Wallis is Executive Director of the Vermont Retail Association. www.vtretailers.com