Point of Purchase Displays and The Evolution of Shopping

In our first blog of the year, we offered 10 predictions for 2017 that would impact the retail industry and point of purchase displays. If you missed our post, you can read it here. We’re always looking at underlying trends and trying to figure out how they are likely to impact the retail industry in a broad sense and how the world of POP displays might be affected more specifically. We recently came across an article that aligns with our thinking about how the retail industry is evolving. The article was entitled “The Way You Shop Will Change Forever This Year. Here’s How.” The article outlines 4 key trends that are helping to reshape the buying experience in retail stores. In today’s blog, we’ll summarize those trends and add our two cents. If you are interested in reading the full article, you can read it here.

Trend #1- Evolution of the Warehouse-Storefront Model– This trend was actually one of our 10 predictions for 2017 so it’s nice to get some outside validation that we are on the right track. What’s interesting here is that we have an entire industry of Big Box stores that have been built around a suburban real estate model. This model made good sense at the time most of these stores were being built, but now a lot of millennials are moving to cities and not buying cars. This generation of shoppers stands in sharp contrast to the shopper who heads off to Wal-Mart to load up the SUV once every week or so.

Walmart market Point of Purchase Displays

To serve this emerging segment of shoppers, Big Box stores are likely to convert their large retail spaces into warehouses with smaller storefronts. These warehouses will provide inventory and service to a network of smaller format stores in satellite locations that carry less inventory. In our view, this is a logical evolution for the Big Box guys to address the critical issue of convenience that many shoppers value above all else.

Trend #2- Emergence of Retail Services– The days of competing based on carrying large amounts of inventory are coming to a close for retailers. Stores will increasingly offer services that can’t be offered online. We’re talking about things like pet grooming, teeth whitening, blood pressure monitoring, tennis racket restringing, etc.

dog groomer Point of Purchase Displays

Shoppers will go places for people and services but not necessarily for things. POP displays will be used to explain these new service offerings in the same way they are used to promote products in retail stores today.

Trend #3- Relentless Focus on Convenience and Creating Experience– In response to the convenience and intense competition of online shopping, retailers will increasingly focus on matching the convenience of online shopping and creating unique shopping experiences. The more innovative brick-and-mortar retailers are testing delivery services, drive-through pickup models, and free shipping. Stores are trying to become more locally relevant by modifying their product selection according to the desires of the local market.

Local Market Point of Purchase Displays

Many retailers recognize that it is becoming difficult to compete with Amazon on commodity staple items like toilet paper, laundry detergent, and toothpaste. Instead, retailers are working to create unique experiences revolving around things like picking fresh produce or creating prepared meals to go. Some supermarkets are even contemplating allowing customers to grow their own food.

Trend #4- Technology-Driven Inventory Management– RFID technology has been available to brick-and-mortar stores for many years, but its impact has been minimal…until now. With the price of RFID chips dropping to less than 10 cents per chip, RFID technology is finally poised to revolutionize inventory management in stores. RFID technology will finally be able to solve the problem of stores knowing inventory by location. This will not only help stores from a management perspective, but more importantly, it will go a long way in terms of improving convenience for shoppers.

project secos Point of Purchase Displays

One of the main breakthrough areas for RFID technology will be payment. Shoppers will automatically be able to pay for goods similar to the way Amazon has depicted the shopping process in their new Amazon Go stores. The second breakthrough involves smartphone applications that will utilize RFID technology to enable shoppers to pinpoint the location of products in a store within seconds. Both of these applications will improve convenience and dramatically improve the physical shopping experience.

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