The future of retail – Top trends to watch in 2016

This year’s Future Laboratory “Retail Future” report shone a light on the most important trends for retail brands to watch in 2016 and made for a compelling read. If you are in the retail business or a digital advocate like me then here are some of the big emerging trends in the report of interest that are set to shape the retail landscape in 2016:

Social commerce

Social commerce has never lived up to its promise as a big driver of global retail growth. In 2016, that could start to change with both Facebook and Twitter trying hard to turn its potential into performance. The challenge they have both faced is to keep up with the might of Amazon and create seamless, intuitive s-commerce shopping experiences people want to actually use. Facebook is regarded as having the best chance of success – its ability to track ‘likes’ and reactions with its powerful new Audience Insights tool is expected to allow it to build detailed customer profiles that should help it to crack the s-commerce market. Twitter will also be interesting to watch. It recently achieved an s-commerce breakthrough through a Topshop London Fashion Week partnership. It matched catwalk trends to in-store ranges and purportedly drove an impressive 18% week-on-week sales boost.

Loyalty Rewards 3.0

According to Forrester Research only 30% of consumers use retailers’ apps to buy products. In response, future-facing retailers are rolling out mobile based apps that offer rewards and concierge-style services instead of penny-for-a-point strategies. For example, Harvey Nichols adopted this approach with its new loyalty app after discovering that 80% of its consumers preferred mobile-based access to its loyalty scheme versus using plastic cards. This form of modern consumer engagement is helping them and other brands connect with their customers on their terms and sustain engagement via real time rewards. You can find out more here.

Text commerce

Innovative retail brands are scaling back their omni-channel efforts and getting direct and personal with customers via text. As 90% of texts are read within three minutes of receipt this gives brands the opportunity to create real time conversations and sales opportunities. For example, Drinkeasy, an SMS-based start-up, sends text updates to its members alerting them to the availability and price of its latest craft spirit stock. Customers reply with the amount they wish to buy and the products are promptly delivered to their homes. A simple fuss-free value exchange powered by technology.

Data driven retail experiences

Retailers should look to combine big data with online feedback and use this to create engagement strategies that integrate their customers’ reactions and feedback into product development and sales strategies. One brand that has done this successfully is fashion brand Target who partnered with the media platform Who What Wear to understand which were the most popular street style posts on the site. They analysed user data, including passive clicks on styles and reader feedback, and then took the top styles to inform their approach to designing a new range. This is a great example of tapping into customers’ curated shopping desires and aspirations and making them available in the real world, at an affordable price.

Mobile commerce & the growth of wearables

Retail payments and consumer engagement is set to be transformed as mobile devices increasingly become the preferred payment option. With the advent of proximity, or contactless, payment systems such as Apple Pay, Android Pay and Samsung Pay, the total value of proximity smartphone payment transactions in the US will grow by 210% in 2016. The next frontier for mobile purchasing and retail service is wearables, with it being anticipated that in four years, wearable payments will represent about 20% of the total mobile proximity transaction volume and about 1% of total cashless transactions in retail. It is interesting to see how Mastercard is leading the charge on this and future proofing itself by developing technology that will turn any smart device into a mobile payment system, from wearables to key fobs.


It is important to note that bricks-and mortar retail are also experiencing big strides forward with the re-invention of the physical store. Pure online brands such as Amazon and Google are fast establishing footholds in the real world. Whilst innovative bricks-and-mortar retail brands are launching a new offensive against their online rivals by building a strong sense of destination and location-specific experiences, re-enchanting consumers by creatively utilising their greatest asset – physical space. Future trends predicts that retail stores are set to continue becoming brand embassies and product showrooms that combine entertainment, leisure and sensory intrigue, where consumers can touch products and live and breathe the brand. Lululemon’s Hub 17 flagship store in New York’s Flatiron District is one example of this, combining engaging in-store experiences with one-stop social activities and events including yoga and fitness workshops.

It’s a hugely exciting and enormously interesting time in the fiercely competitive retail sector and we’re looking forward to seeing how brands continue to engage and influence their customers across all touchpoints in the value chain.

Claire Twohill
Head of Digital

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