According to Retail Traffic Magazine moods of European Shopping Center owners have finally started to improve. While this may herald a return of permanent retailers to the shopping centers, the future is not all rosy. The retail segment has seen erosion of its sales at physical stores over the years, largely replaced by transactions within ecommerce stores, excluding mobile. According to Deloitte, percent of retail sales from traditional brick-and-mortar stores is currently 91% and expected to fall to 76% in the next 5 years. The need for the big box retailer was losing appeal, replaced by the internet retailer.
Only recently, it appears there may be an emerging third retail sales-channel, called the ‘pop up,’ enabled largely by cloud computing. Using POS, CRM, and other services via a secure cloud connection, they have all the same IT services. While the pop up retailer acts like a physical store, with inventory and systems, it outmaneuvers most other retailers with its agility and flexibility to pack-up and follow customers, seasons, or events. Imagine a store ‘untethered’ by burdens of permanent locations, staff, machines, or fixtures.
If you’ve been visiting the local shopping mall during Halloween and Christmas seasons, I think you’ve seen this third retail sales channel, the pop up retailer. Companies like Spirit Halloween and The Latest Scoop that maintain no long-term physical presence, but spring up overnight in empty retail spaces and depart after only a few weeks or months. In an industry widely known for ‘brick and click’ retailers, we’re seeing the emergence of the ‘quick’ retailer. They are agile, mobile, and capable of being strategically placed in large part to the capabilities of the internet and cloud computing.
Adapting to market trends, testing a market, or moving to where the customers are, the retailers are free of shackles of IT and many back-office systems. Nick D’Alessio, Dell Retail Marketing Lead states, that, “Vendors such as RICS are making cloud applications so simple, any merchant with an internet connection potentially becomes a store overnight. The idea that internet and your inventory is all you need brings savings, curiosity, at a ‘shock and awe’ speed that consumers don’t expect. Traditional brands like Target and Prada are trying to keep up.”
Again, the cloud is breaking down barriers what would have made it impossible for small/midsize business to innovate and compete with their larger brethren in peak seasons. You can read more on our white paper (published 4/30) called Cloud Evolution: Moving into the Mainstream of Retail IT.