We asked our Head of Business Development, Paul Seaman, to give us the low-down on what’s shaking up the retail industry in 2019 in our latest Viewpoint blog:
When someone mentions shopping, what do you think? A trip to the high-street for some retail therapy? A slog round the supermarket to complete the weekly food shop? Or perhaps a spot of online shopping on your phone in front of the TV?
The truth is shopping habits, and retail spaces, have been changing steadily over the past decade. There are more ways to shop and more ways to pay. But the most notable shift over the past 12 months hasn’t just been a difference in how consumers are shopping, but in what they are buying and what they expect from the companies they buy from.
And as an appetite for ethical shopping and ethical consumption begins to outstrip the desire for convenience, what does that mean for retailers in 2019 and beyond?
Not just retail therapy
Retailers are well-versed in how to encourage customers to make a purchase, and to feel good about doing so. Competitive pricing, an intuitive retail environment, friendly and professional customer service. But there is now an extra force driving consumer opinion around brand – does that brand DO good.
Last year, Pennies research revealed a huge 81% of the British public expect retailers to show socially and ethically responsible behaviour and this trend shows no sign of slowing in 2019. In fact, leading financial services experts Teamspirit recently predicted ethics to be the number 1 trend set to affect business over the next 12 months.
Crucially, retailers are waking up to the ways they can do better, and make their customers feel good in the process. This is driven not just by consumers, but also by internal culture (staff being attracted to and feeling good about working for a transparently ethical business) and investors (wealth managers and individuals looking to invest in companies are using big data to understand the Ethical, Social and Governance (ESG) policies and practices of firms).
What are you selling?
Consumers are willing to take a hit on convenience if they can get their hands on something they know is more ethical. The decline of the Great British Shopping Centre and rise of SMEs selling local, responsibility sourced produce and hand-made goods is testament to this. Retailers who adapt to this challenge by diversifying what they sell and who they collaborate with are already reaping the benefits of happier, more loyal, and more evangelical customers.
Are you sustainable?
Another key driver of consumer loyalty is a retailer’s sustainability. While fast fashion is still a major issue on Britain’s high-streets, businesses are making strides to combat this, often very publicly.
For example, Britain has the third largest e-commerce market in the world, but with more online shopping comes more deliveries – which means greater carbon emissions from more vehicles on the roads. Brands like ASOS are aware of this trade off and now text and email customers in London any time a delivery is made in one of their new GNEWT electric vans. This is exactly the message to encourage loyalty from a customer base made up of millennials and Gen Z-ers.
Similarly, IKEA are making visible strides to make their flat-pack, affordable model more sustainable too, selling refurbished furniture in Scotland as of 2018 and introducing textile recycling in-store.
Practices like these become part of a company’s ESG programme and can be communicated to key stakeholders through annual reports and other comms.
Creating a community
When Pennies commissioned research last year to find out more about the ethical consumer, we found they put the highest value on retailers contributing to communities. Over the years, we’ve also found that giving customers the chance to make micro-donations when they shop builds a brilliant community – ensuring donating to charity remains affordable and unites people (however quietly but persistently) behind common causes.
In the 9 years since Pennies launch, we’ve built a community of hundreds of retailers, charities, payments providers and supporters, and a community of millions of members of the public who’ve felt empowered to give their small change a big purpose (68 million times to date) through our digital charity box.
There is huge appetite across the retail industry to face these modern challenges, as evidenced by the British Retail Consortium’s Better Retail Better World initiative, drawing businesses together to make positive changes in line with the UN’s Sustainable Development Goals. Pennies recognises the importance of these challenges too, and we will always support our partners as they strive to enhance their Corporate Social Responsibility or Environmental, Social and Governance agendas.
We know that it feels good to be part of something bigger, and that the power of a few pennies to make a difference is bigger than ever.
Paul Seaman, Head of Business Development, Pennies
To find out more about introducing Pennies to your business, email me on email@example.com