Fearless Predictions 2011: Retail Bounces Back

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Fearless Predictions 2011: Retail Bounces Back

By Joe Skorupa - 01/04/2011
By Joe Skorupa

Sales surged during the recent holidays and most economic indicators point to growth. What a difference a year makes. Last year there was a feeling of uncertainty tempered by vague hopes of improvement, but only because the bottom had been hit and there was nowhere to go but up. Today, retailers are in a brighter mood and focusing on specific opportunities. Here is what to expect in 2011 from a collection of the smartest leaders in retailing.
 
To get a handle on what to expect in 2011 I spoke to the below list of leading retail industry experts. For their complete comments be sure to check the cover story, “2011 Review and Outlook,” in the Janaury 2011 issue of RIS News when it posts on the Web by the end of the week. Comments follow from the following executives:
 
Jody Giles, CIO, Under Armour
Leslie Hand, research director, IDC Retail Insights
Cathy Hotka, Principal, Cathy Hotka & Associates
Jon Kubo, CIO, Wet Seal
Mike Matacunas, president, Parker Avery
Mike Mayoras, CEO, RedPrairie
Bruce Richardson, chief strategy officer, Infor Global Solutions
Matt Shay, president & CEO, National Retail Federation
David Sikora, founder and CEO, Digby
John Thompson, SVP & general manager, BestBuy.com
 
Certainly there is a lot of hype about social media and its relationship to brands, but I don’t think there’s been enough thought or action put into it by retailers. This is not just a new marketing channel. Social media just enables humans to do what they’ve always done in a much bigger and faster way. – Jody Giles, CIO,
Under Armour
 
Shoppers are increasingly shopping across different channels from the store to online, and the rising volume of these purchases requires the use of more sophisticated multi-channel strategies by the retailer. This trend, which impacts where retailers hold inventory and how the store is staffed and trained, requires agility with inventory allocation and distribution. The top retailers are putting significant resources behind this analysis to synchronize inventory, transportation, and workforce to improve the bottom line. – Mike Mayoras, CEO, RedPrairie
 
The slow economic recovery is the one issue that impacts all issues, and I don’t believe there has been enough attention paid to the important role the retail industry plays in our economic recovery. In the midst of this uncertainty, the retail industry has been at the forefront of economic growth, providing jobs for more than 25 million workers and creating one in five jobs in the United States. Last year, total retail sales reached $4.4 trillion, accounting for two-thirds of our nation’s GDP. So, with all of the uncertainty that remains, the one fact that remains clear is that the road to economic recovery runs through the retail industry. – Matt Shay, president & CEO, National Retail Federation
 
One big trend having an impact on how people are shopping this season is mobile technology. We are bringing the Best Buy experience to more places than ever – beyond physical stores and BestBuy.com – to a wide variety of mobile touchpoints. Use of our Mobile technology (m.bestbuy.com, iPhone/Android apps) grew exponentially in 2010, and we believe growth will continue in 2011. Consumers expect Best Buy to deliver the latest and greatest technology, and we believe it is important to be fully involved in this amazing mobile transformation. – John Thompson, SVP & general manager, BestBuy.com
 
2011 will be the year of the tablet store. While some of the largest retailers already have an iPhone app, I think we will see virtually everyone with an iPad presence by the end of next year. In addition to having their stores on iPads, cool retailers will use the iPad for POS/in-store payment systems. This will necessitate links to back-end inventory and merchandising systems. I’m also watching to see if anyone attempts to compete with HSN or QVC on television? Will we see a Nordstrom channel, for instance, where shoppers can order via cable remote? – Bruce Richardson, chief strategy officer, Infor Global Solutions
 
One big trend we are seeing is the resounding success of omni-channel programs, with leading retailers reporting significant jumps in mobile and Web-based pre-shop and buying activities year over year. Additionally, retailers are also reaping the rewards of their hard work on demand-based inventory, pricing and promotional programs. This should be a satisfying holiday season for these retailers, which should see year-over-year growth and profit benefits.  – Leslie Hand, research director, IDC Retail Insights
 
It has been a long time since I have seen the breadth and speed of technology innovation, and the jump in the number of innovative retail business models. The feeling I get is that we are at an inflection point of change for all types of retailers, and 2011 will be a year of excitement and some anxiety. Understanding the impact of these new technologies, business models and changes in consumer demand has never been more difficult. In this age of the social media boom consumers will tell us what they want if we listen. This approach means changing how we think as retailers. At the heart of this change is how we interface with our customer. Mobile and social media are blurring the lines of how we define a channel.  – Jon Kubo, CIO, Wet Seal
 
“I expect 2011 to change the way retailers think about customer engagement, pricing, merchandising and marketing. For retail leaders, this will be a transformational year.” – Mike Matacunas, president, Parker Avery
 
“There will be three major themes in 2011: managing enterprise mobility, monetizing social networking, and looking into how item-level RFID can improve store operations. Retailers are in a vastly better mood than they were last year. CIOs are hiring staff, projects continue to be added, and the appetite for new technologies is as sharp as I have ever seen it.” – Cathy Hotka, Principal, Cathy Hotka & Associates
 
One area that did not get all the attention it deserved is how quickly mobile went from a science experiment and a “nice-to-have” to a real revenue driver and a “must-have”. Retailers also realized they needed to look at mobile as a strategic channel and as an opportunity to create a unique experience for their customers. In 2011, we are going to see the true emergence of the in-store experience for mobile. Mobile retail apps will completely change the way people shop in-store, online and through the catalog. – David Sikora, founder and CEO, Digby

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