October 7, 2020
Retail news and trends to watch out for
- Three in one. Travel retailer Dufry has pulled off a coup, inking a deal that will provide it with financing, boost its digital business and give it a stronger foothold in the lucrative Chinese market. The deal comes in the form of a joint venture with China’s Alibaba Group. (where Alibaba has a 51% share), and will see the Chinese group buy up to 10% of Dufry. This is good news for Dufry, which is reeling from the severe fall-off in travel due to the COVID-19 pandemic. It provides Dufry with access to Alibaba’s 800 million Chinese consumers and will help it beef up its digital business, which will be key to securing future sales. Dufry says the deal will help it fulfill its ambition of becoming the leading digital travel-retail company worldwide. Expect similar tie-ups between brands or retailers with tech groups.
- Golden Week. All eyes are on how spending on travel and shopping will pan out during China’s Golden Week, which began last Thursday. Up to 600 million trips were expected to be made in China during the Mid-Autumn Festival holiday. Travel (albeit only domestic) is expected to get a boost as this year’s Golden Week overlaps with the week-long National Day holiday. Key spots like Shanghai, Chengdu and especially Hainan – whose new trading regulations are boosting sales of duty-free in the province – are set to benefit. Chinese state media outlet Xinhua just reported that China’s Hainan island’s duty-free spending by visitors grew 227.5% to Rmb8.61bn ($1.26bn) between July 1 and September 30 compared to the same period last year. Cosmetics, watches and jewelry were the most popular products, accounting for 73.3% of total sales revenue. The number of tourists rose 62% year-on-year to 1.29 million during the period.
- BOPIS and curbside pick-up on the up. Some 80% of US shoppers expect to increase their use of Buy Online, Pick-Up in Store (BOPIS) and curbside pick-up services over the next six months, according to a report by industry insights firm Incisiv. Another 90% say they prefer home delivery over a store visit. The report found that 85% of shoppers have significantly increased curbside pick-up orders compared to pre-COVID-19 rates, and 79% say a contactless store pick-up is very important to them. While 91% say they miss brick-and-mortar shopping, only 5% plan to try a product in-store in the next six months and only 28% plan to increase in-store shopping. Stores’ safety protocols, whether for in-store purchase or order pick-up, was one of the most important features for respondents. But while US shoppers may use contactless pick-up more, they also rated their recent checkout and pick-up experiences poorly, due to factors such as the availability of pick-up slots to in-store pick-up wait times. Some 85% of shoppers rate easy completion of an order with four stars or higher.
- Pay by palm. Amazon continues its quest to make in-store payment easier, with a new contactless system that uses palm recognition technology called Amazon One. The first time a shopper uses it, they scan the palm of their hand on an Amazon terminal and enter their credit card details. The device then associates the shopper’s “palm signature” with their credit-card information. Once enrolled, customers can use Amazon One to pay in stores by scanning their palms for one second. Shoppers who link their Amazon account with Amazon One can log onto the retailer’s site to manage information and view usage history. Amazon One is available at the company’s two Seattle-based Amazon Go stores. The retailer is looking to offer the technology to third parties, including retailers, stadiums and office buildings.
- Walmart’s omnichannel push. US retailer Walmart has unveiled a new store format that encourages shoppers to use their phone as their guide when shopping. The new store layout was inspired by airports’ wayfinding systems and replicates their navigation systems to help move customers through the store more quickly. The store’s signage has been redesigned to encourage shoppers to download the Walmart app to help with in-store shopping. The signage informs shoppers that they can search for products via the app, which directs them to a store map and shows them the way to the items. Aisles are also marked with letter and number combinations to guide customers from phone to product. Stores will include self-checkout kiosks, as well as contactless payment solutions, including Walmart Pay, to limit contact between staff and customers.