3 Critical European Retail Trends to Watch

Woman Shopping
 

By Benjamin Rudolph

With consumers having increased access to globalized markets and international brands, it is important for retailers to take notice of market trends outside of their domestic borders. Understanding how consumers and brands in other regions enthusiastically embrace innovative services and bold technologies can help your brand to create a new shopping experience, solve a current pain point, and attract new consumer segments. Here are three emerging trends in European retail markets that North American retailers should watch:

1. Personalization, privacy, and anonymity. Retailers must walk the fine line of customers’ yearning for personalization and customers’ heightened concerns over the collection and use of personal information and data. This holds particularly true in a post Cambridge Analytica world.

Unlike businesses in North America, European retailers must comply with the General Data Protection Regulation (GDPR). This legislation, focused on transparency and fairness for consumers, ensures that data may only be collected if consent is given, only held for limited periods of time, and can be deleted if a user requests it to be so. 72% of European consumers claim awareness of this law, and 82% say that they would consider requesting a brand to remove personal data collected about them.

With many retailers having their databases depleted, or with the potential to be, brands need to reverse this trend. European brands challenge themselves on how to make it worthwhile for consumers to opt in rather than opting out of data collection. In a recent report by Oracle, only 16% of European consumers felt that the offers they were currently receiving were “always personalized”. With 56% of consumers agreeing that personalized offers are important to their shopping experience, European retailers are seeking to embed AI infused recommendations into electronic direct mail and throughout shopping touchpoints.

North American brands should take notice and focus on using data to provide a true customer benefit, prior to the potential introduction of similar privacy laws. Both Canada and the United States are debating privacy laws at a federal level, and California will introduce the The California Consumer Privacy Act (CCPA) in 2020.  

2. Mobile point of sale (mPOS): Consumers hate waiting. It’s estimated that long queues cost European retailers close to €16.3 billion. Fortunately, mPOS systems offer merchants a solution. mPOS is a smartphone, tablet, or other device that performs the tasks traditionally handled by a cash register or POS terminal. 

The ultimate benefit of mPOS is that it allows financial transactions to be conducted in a versatile manner without being tethered to a single checkout counter. This permits retail employees to browse stores and find people looking to check-out, capitalizing on immediate excitement and interest in your products. This also keeps queues at checkout counters shorter. Further, mPOS proves ideal for retailers that are more mobile, allowing for payments to be processed on-the-go at flea markets or if your brand hops on the pop-up store trend.

There are also a large number of mPOS startups in Europe. These startups compete on price and offer lower transaction fee costs than banks charge for traditional POS systems. mPOS offers other cost savings in the form of freeing up selling space and reducing hardware maintenance costs. Further, mPOS systems appear better equipped to accommodate contactless payments and mobile wallets like Apple or Google Pay. 

mPOS adoption lags in the US, with Square being the primary mPOS provider. North American retailers would be smart to transition to mPOS, especially as the US finally adopts more contactless payment methods.    

Need proof of the benefits of mPOS? One European brand reaping the benefits of mPOS is Schuh. One of the largest footwear retailers in Europe, Schuh struggled with foot traffic and long queues in its flagship London store. After the introduction of mPOS, Schuh reported improved wait times and found that mPOS accounted for 80% of its sales. 

3. Click-and-collect: In 2018, click-and-collect sales totaled over €27 billion in Europe. Allowing customers to retrieve their eCommerce parcels from retail locations has become an essential delivery option in Europe and an important part of retailers’ omni-channel strategy. More than half of European consumers used click-and-collect in 2017. Even Amazon has debuted a click-and-collect offering in the UK and Italy, called Amazon Counter.

Click-and-collect delivery options allow customers to pick up their e-commerce purchases at brick-and-mortar locations. This is extremely helpful for customers who worry about the security of their packages if they are not home when they are delivered. At a time when retailers are losing sales to online methods, click-and-collect drives customer traffic to stores, potentially sparking an impromptu purchase. Adopting a cross-sell strategy by including in-store coupons with online purchases is one such way to maximize this potential. Click-and-collect locations also help to improve the customer experience by becoming physical customer service locations, handling product returns.

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Tricia McKinnonTrends2 Comments