Top five retail trends to watch in 2017

Pitt St shopping mall Sydney

Aussie retailers saw a boost in sales in 2016, with the latest figures from the Australian Bureau of Statistics showing an increase of 2.8% on the previous year. With some measures of consumer confidence high in the lead up to Christmas, I expect a number of new trends to break ahead of the pack.

Next year will be the year where customer experience becomes a tangible reality, with a focus on in-store experiences and more personalisation. Here are five trends to watch for Aussie retailers.

1. “Retailtainment” will take off

Watch out for the newest aspect of the in-store experience trend to start gaining popularity in Australia in 2017 – “retailtainment”. This is the fusion of retail and entertainment — making the in-store shopping experience enjoyable, entertaining, and encouraging shoppers to step away from online browsing at home and into the shops instead.

“Retailtainment” assumes that people are more likely to engage with retailers that incorporate lifestyle elements into their stores, such as boutique coffee shops or virtual reality experiences. We’ll certainly see more “retailtainment” in bricks-and-mortar retail stores in 2017.

2. Personalisation will become increasingly important

According to an Accenture Interactive study, 56% of consumers are more likely to shop with a retailer that recognises them by name.

Personalisation in retail has been around for years but unfortunately, the tactics retailers once used to speak directly to customers (such as using first names in an email) have become outdated and transparent in the eyes of customers. At the same time consumers are searching for more personalised shopping experiences, so 2017 will see retailers testing new ways of doing this.

One Aussie retailer that continues to lead the pack with personalised experiences is Shoes of Prey, but others are starting to make it easier for consumers to personalise products too. For instance, EziBuy is now offering hundreds of products with personalised options as a regular feature on its site.

3. Smaller shops are in, larger shops are out

When it comes to store size, less will be more in 2017.

We’ve already seen a shift here, with retail giants such as Target, Kmart and Priceline investing in smaller-format stores to provide more curated selections. Consumers don’t want to waste precious time wandering around enormous stores anymore. Instead, they want the ease and efficiency of smaller stores with specialised selections.

There are other benefits to smaller stores as well. They cost less money to open and operate, and they take up less space in urban environments, allowing retailers to capitalise on the potential of high-density areas and foot-traffic.

Read more: Lincraft undergoes revamp as Australian retailers get crafty with store spaces

4. Specialty stores will be more popular than department stores

Specialty stores that focus on categories such as beauty products, like Mecca Cosmetics, will have an advantage in 2017 as consumers focus on curated selections.

Australia’s department store sales have been consistently declining for many years in response to the rise of e-commerce and standalone specialty stores. We all know online shopping shows no signs of slowing down, but how will the bricks-and-mortar establishments — specialty and department — fare against each other?

Look for specialty stores to win in the coming year. These niche retailers tend to provide better in-store experiences for their customers, with more knowledgeable staff, better prices, and more personalised service.

5. Retailers that promote product quality and sustainability will flourish

Customers today want to know more about the goods they’re purchasing – where they’ve come from and how they’ve been sourced and produced. The proliferation of transparent, sustainably conscious companies has initiated a radical shift in the retail industry — one we can expect to gain greater traction in 2017. Shoppers are gravitating toward retailers that reveal the inner workings of their operations.

Kathmandu, for example recently opened its new Galleria Store making it a pioneer in sustainable retail. The store features a range of sustainability features to meet the Green Star submission standards and enhance the indoor environmental quality for customers and staff. There’s now a worldwide shift toward sustainability, and a consumer desire to be more ethically conscious and to support brands with a “strong sense of identity.” Retailers need to be at the forefront of this shift in 2017.

Evolving customer preferences and how to satisfy changing needs has been talked about a lot in 2016. In the coming year, there are going to be many more opportunities for retailers to respond to these challenges and further shake-up the way they engage and attract shoppers, and grow their market share.


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George Naumovski
5 years ago

As it states in this article that “retailer to know you by name and smaller shops are in” it goes back to the local shop days where the owner knew your name and everyone else in the area and it was smaller and had less range of products. With specialty stores or smaller shops the price is always higher as where the big chains can offer much lower price and more rage/variety and that is why many specialty/small shops go under, the ones that survive and thrive have a following and offer something that the other shop and big chains can’t. I am all for supporting small businesses and try to buy as much as possible from them but the advantage from the big stores is sometimes difficult to overlook.