International sales can be critical for growth when planned for

International sales are an important part of the retail industry. While managing purchases across multiple borders, languages and other differences requires powerful point of sale software to handle the diversity of customers, a wider range of shoppers promises a greater degree of success for growing businesses. 

That said, merchants that are only just now contemplating moving from a domestic to international business model may not be aware of all the pitfalls awaiting them once their products cross into another country. Some are self-evident – unless retailers plan on building a brick-and-mortar store or working with local suppliers in another nation, shipping costs are going to rise. Even then, the specific expense may not be known without a little education on the subject. 

Integrated Solutions for Retailers delved into some of the common problems in more depth, explaining that linguistic and cultural differences are two of the main considerations merchants should keep in mind before moving into international business. Currency, delivery times and custom taxes are also issues that should be planned for ahead of time. 

Another problem that merchants can run into is unwittingly selling restricted products in another country, so local laws should also be accounted for in the business plan. But with the news provider reporting that 95 percent of consumers exist beyond the United States, moving to an international business model could be key to growth. 

Government shutdown may revise holiday shopping season estimates

The gradually recovering economy held the promise of an improved holiday shopping season. As jobs increased, the number of shoppers with additional cash to spend rose. However, initial estimates about retail sales may need to be revised due to the United States' government shutdown. 

Currently, the National Retail Federation (NRF) predicted that sales between November and December will increase by 3.9 percent over the 2012 season. However, this may change depending on how quickly the government resolves the shutdown. 

"Our forecast is also somewhat hinging on Congress and the Administration's actions over the next 45 days," said Matthew Shay, NRF President and CEO "Without action, we face the potential of losing the faith Americans have in their leaders, and the pursuant decrease in consumer confidence."

Retail industry professionals still have reason to remain positive. Should the problem finish quickly, the NRF believes that improvements in the U.S. housing market and consumer desire for more expensive items may bolster sales come November. In addition to the more modest overall growth, online purchases may rise a more dramatic 13 to 15 percent. Because of the added strain on retail ecommerce software, merchants should ensure that their technology is up to the task. 

Retailers should prepare for the shortened holiday season

The holiday retail season may not be here, but prep-time has for many companies. Amazon recently announced that it will be hiring 70,000 full-time seasonal jobs. This 40 percent increase from last year may indicate a level of confidence in the approaching shopping months, particularly since the company also believes thousands of employees will remain on as permanent staff members. 

However, merchants should also be aware that this will be one of the shortest holiday seasons in recent years. Black Friday falls on Nov. 29, and retailers will only have a 25-day window to drive sales, unlike the 31-day long season from 2012. These dates also give consumers one less weekend – four instead of five- to shop than usual. This will result in some stores offering promotions earlier in November or potentially October, and industry professionals should remain aware of various markets to capitalize on less well-defined sales dates. Inventory and sales staff management may have to be adjusted because of this. 

Sales up, foot traffic down
According to a study from analytics firm ShopperTrak, retailers should also expect a 1.4 percent decrease in foot traffic from 2012. However, sales are actually expected to rise by 2.4 percent from the same period, with the apparel category anticipated to experience an overall 2.8 percent increase in sales and only a 1.0 percent reduction in customer visits. Big-ticket items may be more central to stores' success this year, or a higher volume of purchases from a smaller segment of consumers. 

Due to the disparity between the foot traffic and sales anticipated at brick-and-mortar stores, along with a shortened holiday sales season, merchants should begin adjusting their usual strategies to account for these factors. The fewer number of shopping weekends could lead to longer lines and more last-minute purchases. A streamlined point of sale system can tackle these obstacles and ensure that stores operate smoothly from customer to customer. Even as the total number of consumers decreases, the amount of patrons shopping at once may increase drastically due to the compacted time between Black Friday and Christmas. 

Amazon's move may also indicate a greater level of eCommerce sales this year, so merchants should ensure that their eCommerce software is up to the task of handling a greater volume of customers. This will be another item that retailers should consider while planning out their store operations for the coming months. 

Habits of the millennial shopper

For many retailers, millennials are the prime demographic for their marketing efforts. As a large population with growing influence and purchasing power, millennials' importance to the retail industry will only increase in the coming years and attracting their business will be a critical component to brand strategies. However, some traditional merchants may be concerned that this marketing shift will result in further reliance on e-commerce.

An NPD Group study found that millennials conduct 81 percent of their retail shopping in brick-and-mortar stores. By comparison, only 19 percent of their purchases occur online.

Notably, millennials do not typically buy high-priced items. Even among affluent members of the generation earning more than $75,000 annually, luxury purchases rarely exceed $250 for a single item. But while millennials avoid extravagant expenses, they are frequent shoppers, with 53 percent of them browsing store aisles nearly every week.

To best attract this generation, the NPD Group suggested tailoring product selection and marketing through social and online channels. By doing so, merchants can create an integrated shopping experience that flows from a customer's initial interest to the point of sale.

Customers may come to expect seamless integration from all retail channels

The point of sale no longer occurs at the register alone, and as time progresses, retailers may need to integrate all levels of their operation from the brick-and-mortar store to their e-commerce site. Consumers are coming to expect that merchants will offer a similar level of service regardless of whether they are buying an item online or in-person.

However, many businesses may still possess departmental silos that reduce their ability to integrate data and improve service through every part the organization. Eliminating these silos can create a seamless shopping experience that provides the same level of customer satisfaction regardless of how an item is purchased. Retail management software can help merchants attain consistent service across all aspects of the business.

Online purchase, in-store pickup
One trend that some retailers have recently been instituting is the in-store pickup of items purchased online. Internet Retailer noted that Target will be providing this service throughout its nearly 1,800 stores as well as its e-commerce site. While it will begin in Minneapolis, the company plans on implementing the policy throughout its chain locations around the holidays. 

Target follows in this trend with other major retailers such as Staples, Wal-Mart and Gap, all of which provide their customers an interconnected e-commerce and brick-and-mortar shopping experience. 

This is but Target's latest effort to link its sales among multiple channels, with Internet Retailer reporting that it also began testing Cartwell, its Facebook-based discount service.

Simply because a retailer's relationship begins online does not mean it will remain there, and customers may come to expect greater integration among all branches of a merchant's business. Brands that move toward this sales structure may experience an increase in customer loyalty as well as a greater number of sales stemming from shoppers who know that a chain will meet them on their own terms, and at nearly any time. 

The impulse buy
Integrated Solutions for Retailers levied one criticism against Target's move, noting that the brand partially relies on impulse buys. Regardless of whether this is true, merchants should remember that this aspect of shopping will remain a critical part of why brick-and-mortar stores are still an important aspect of the shopping experience. While e-commerce has become more integral than ever, it will never be able to sate a customer's need for something right now. 

Consumer habits shift from apparel to large item purchases

The back-to-school shopping season is swiftly drawing to a close, and with it, retailers can now assess their recent performance. Merchants have a brief lull before the holidays kick off, and they can use this opportunity to predict how they might fare in the coming months. 

According to Reuters, August's back-to-school sales exceeded expectations, but only because of considerable discounts. Chains such as Zumiez Inc, Buckle and Costco all beat out their projections, but an increase in retail merchandising promotions from 2012 may negatively affect their margins. Some stores offered discounts as steep as 50 percent. 

Shoppers buying more durable goods also contributed to weaker sales for discretionary items like apparel. Bloomberg reported that after consumers postponed purchases like automobiles and homes during the past few years, they are now more willing to invest in these big ticket items

However, the nature of large item purchases means that they will typically be longer-lasting. This could result in an uptick to retail sales in the coming months, as spending habits normalize. Additionally, Bloomberg noted that back-to-school spending may still increase once teenagers know what their friends are wearing. However, the source reported that retailers may have to retain considerable discounts to remain competitive. 

Mobile commerce is about knowing the customer

The widespread ownership of mobile devices, as well as their growing popularity across nearly all generations, has made them an important tool for shoppers. Similarly, they should be a key consideration for most retailers' business strategies for the future. 

What decision-makers should possibly keep most prominently in mind, though, is that smartphones and tablets are deeply personal in a way that many other technologies are not. Unlike the family desktop of yesteryear, few people except the owner ever use a smartphone. Forbes recently suggested that retailers need to customize the shopping experience to the individual to appeal to device-carrying consumers. With retail software more advanced than ever before, businesses that aren't taking advantage of customer data and geolocation may be missing out on sales. The article also noted that, for mobile shoppers, personalization is an expectation. 

A friendly, easy-to-use and mobile-optimized retail website is also integral. According to an IBM study, 63 percent of respondents are unlikely to return to an online merchant if they have trouble using its mobile site. As mobile sales will only grow more frequent as more people purchase smartphones and tablets, a well-performing, mobile-optimized website should not be viewed as a nice customer perk, but instead as a standard business practice. 

Consumers are paying more attention to retailers’ emails

Email marketing has been increasingly used by retailers over the past few years to generate sales and reach out to customers in a more personal way. These messages give merchants the opportunity to connect with their patrons and show their appreciation through relevant products and services as well as discounts and deals that can be redeemed in stores or online.

And it seems as though retail customers are more receptive to these emails than they have been in the past. Internet Retailer reported that a study by Forrester Research found that 44 percent of consumers admitted that they delete marketing and advertising emails. This figure is down from the 59 percent who said the same back in 2010. The research also revealed that 6 percent of respondents stated they often purchase products that are included in these emails, up from the 4 percent who did this two years ago, the source detailed.

These findings show that shoppers are more aware of retailers' emails, and they are opening these messages more to see how the content is relevant to their needs. For merchants that use this marketing channel for boosting sales, having a strong retail management system in place that analyzes customer preferences is one of the best ways to ensure that emails are seen and acted upon. 

Retailers can help hesitant consumers with promotions

Consumers across the country have been feeling the financial pinch of the economic recession. And while conditions are steadily getting better, many individuals are still reluctant to open their wallets, which is putting a strain on retail sales. However, there are steps merchants can take to encourage shoppers to visit their stores and websites, including offering promotions. Not only do discounts and deals attract consumers, but these methods also significantly benefit merchants' operations. Therefore, providing promotions is one successful way in which businesses can help both hesitant consumers and their own bottom lines.

Low-income individuals not spending
According to Reuters, many large retailers throughout the country are reporting lower-than-normal sales totals due to recent cold weather and increased payroll taxes. These big-name brands include Wal-Mart, Macy's and Kohl's, among others. Companies have seen their profits drop recently, and many are attributing the decreases to not only frigid temperatures of the past months, but also to lower-income consumers keeping their purchases to the bare necessities.

"We are seeing some weakness amongst our more budget-conscious, what we call deal-hunting, customers," Macy's Chief Financial Officer Karen Hoguet told analysts this week, as reported by the source.

To combat this trend, many merchants are making plans to enhance existing products and services as well as offer new items at better prices, Reuters notes. Analysts stated that consumers are looking for merchandise at decent prices, so if businesses want to capture additional sales and build their customer base, providing promotions is the way to do it.

How do promotions benefit retailers?
When following new strategies, companies want to be sure that not only are their patrons benefiting from the methods, but that their own operations will get a boost as well. This is why many merchants turn to offering promotions, as Business 2 Community notes that these incentives are just the thing both parties need. The source explains that changes in prices within the retail industry over the past few years have led to a rise in discounts and deals. However, providing promotions is done more so for alterations in competitors' pricing instead of consumer demand.

The source states that is not the best strategy to follow, as retailers who take a different approach will be the ones who see the most from their promotional methods.

"To improve profit margins, retailers must begin to think more strategically about promotions, empower their marketing departments and measure the true cost of ticketing," the source asserts.

Customer personalization matters in stores and online

People like to feel valued, whether it is within their personal relationships or the connections they make professionally. This rings especially true when it comes to consumers dealing with retailers – shoppers want to know their business is appreciated, and if they feel as though they are merely another customer instead of a valued patron, they could opt to go to a competitor. Therefore, making interactions more personalized has become increasingly important for merchants. Failing to do so could result in a loss of not only customer satisfaction, but sharp drops in retention as well.

However, with today's multichannel retail industry, companies have to ensure they are personalizing various elements both in their stores and on their websites. This isn't difficult if organizations follow several steps, and with the right effort and determination, every consumer will feel valued.

Personalization not a priority
Although many businesses are fully aware of the benefits that personalization provides, especially on the internet, there are only a few that are actually making digital interactions more tailored toward individual patrons. According to a recently released report by Econsultancy and Monetate, nearly all of companies surveyed (94 percent) stated they knew that offering more personalized communications on the web "is critical to current and future success."

However, more than half of respondents (56 percent) do not engage in personalized interactions with online consumers, the study revealed. One of the main reasons companies are not yet providing these kinds of conversations is because they are held back by technology. Managing IT systems and maintaining control over databases were some of the top cited obstacles to full personalization.

"It is quite clear that personalization is seen as mission critical to the success of online business but too many organizations have yet to implement a well thought-out and tested approach," said Linus Gregoriadis, research director at Econsultancy. "Those companies focused on delivering personalized customer experiences are realizing great returns in online sales and key website performance metrics."

It's all in the details
While incorporating the right technology is one of the key components to effective personalization, there are other strategies that retailers can follow to provide more engaging communications, both in stores and online. Direct Marketing News explains that gathering simple details about customers – such as name, address, birthday and past purchase history – businesses can apply this information to in-store conversations as well as email messages. Offering small gifts on birthdays or special occasions is one successful way to make shoppers feel more valued.