Retail Trends for 2. Watch El Hotel Electrico Download. The rise of e- commerce over the last 1.

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E- commerce growth continues to accelerate and outpace growth in the brick- and- mortar channel, and online sales accounted for almost 2. US sales this holiday season, based on preliminary estimates.

In addition, department stores have offered discounts and promotions as a key tool to drive demand and bring consumers into stores. Over time, this strategy can dilute a store’s brand and leave stores looking picked through. Also, it trains consumers to wait for discounts instead of buying products at full price. There has been a significant number of store closures in the last few years, and we expect that to accelerate in 2. As the department store channel shrinks, and more brands fight for less space, we think brands will need to be more creative, flexible and diversified in their approaches. One way brands can disrupt the more traditional wholesale channel without taking on the significant real estate risk that comes with opening their own stores is to open pop- up stores. With pop- ups, brands have complete creative control of the brand experience and how their messaging is communicated to consumers.

They can tell the story they want to tell and explain in their own voice what the brand stands for. In some cases, brands use pop- ups more as an advertising tool than as a place to transact commerce. Watch I Want Your Love Vioz.

These kinds of pop- ups usually offer some kind of special experience to draw consumers into the store. Pop- ups can also be set up in locations other than malls, allowing brands to reach their target customers where they are. Retailers and brands can also use pop- ups to test the waters in the most expensive shopping areas, often at discounted rents, while landlords can use the temporary stores to show off the space to prospective long- term tenants. Mall operators are receptive to pop- ups, as they bring something new and unique to consumers. Real estate firm Related Companies has used pop- up shops at the Time Warner Center in New York City to provide a fresh feel and add variety for consumers.

We have seen just the tip of the iceberg in 2. Food trucks have become highly popular, and they now compete with restaurants in a number of markets. We think a similar opportunity exists in the retail space: retailers and brands can operate retail trucks, temporary spaces and pop- up shops in traditional and nontraditional locations in order to drive sales and traffic. Online pure plays are also increasingly seeking a physical presence. Companies such as Amazon, Bonobos and Warby Parker have opened a handful of physical stores, and we think many more e- commerce companies will follow suit in 2. A brick- and- mortar presence will be a necessary part of the business model for online pure plays, and pop- up stores are a good way to test the market.

We think more companies will use pop- up stores to enhance profitability, increase brand awareness and enhance the overall shopping experience. Another way for brands to directly reach consumers is through social media. Instagram and Pinterest, for example, both now offer a commerce tool. In addition to allowing users to shop via its platform, Instagram allows brands to directly share their brand story and messaging with users.

We think this way of shopping will become more mainstream in 2. Online marketplaces from names such as Amazon and Walmart are carving greater share of e- commerce sales in Western markets, including the US and Europe. These regions are following in the footsteps of China and India, where marketplace sites such as Tmall, JD. Flipkart have long dominated online retailing. Marketplaces are purely platform providers. They enable other companies to sell goods or services, but do not provide anything tangible themselves. In 2. 01. 7, we expect competition among marketplaces to intensify further as the major ones gain share of consumers’ online spending.

Internet shopping in the US and Europe traditionally meant buying from a retailer’s or brand’s website—with the obvious exception of e. Bay. Now, consumers in these markets are following trends seen in China and India, migrating to marketplace sites. Below, we identify three phases in the development of online marketplaces. Amazon has led the charge to marketplace formats in the West.

In the third quarter of fiscal 2. Amazon. com—this was the first time this threshold had been reached.

We estimate that, in 2. Amazon’s annual marketplace sales exceeded those of e. Bay for the first time. Walmart moved into the marketplace format in 2. As a result, Walmart added approximately 1 million SKUs per month to its website in 2. Walmart’s acquisition of Jet.

August 2. 01. 6 brought the latter’s 1. Walmart. Walmart has also made investments in JD.

China, taking its stake to around 1. These moves are further bolstering its exposure to the marketplace segment. In Europe, Zalando has been among the retailers to launch a marketplace. Zalando’s is targeted at big fashion brands and, like Amazon, it offers fulfillment on behalf of third- party sellers. There are four benefits to the marketplace model that make it attractive to companies that have previously operated in the direct- retail sector: It is highly profitable. Marketplace sites can charge double- digit commissions for simply acting as portals. Fulfilling orders on behalf of sellers provides an additional revenue stream.

Marketplaces are protected from the risks associated with owning stock. Shoppers are less likely to walk away unsatisfied, as the long tail of product demand can be satisfied with little effort by the retailer, in turn building loyalty and repeat visits.

A marketplace model offers an asset- light way of entering new regional markets. Due to these benefits, we expect major retail names to continue their push into the marketplace format in 2. Amazon will become a majority marketplace by number of units sold and will pull further ahead of e. Bay in terms of marketplace sales.

We also expect to see marketplace providers enhancing their services, such as in fulfillment, in order to make themselves attractive to both buyers and sellers. Marketplace growth will pressure more brands and retailers to establish a presence on these sites. However, over the medium term, we also foresee marketplaces’ share of e- commerce plateauing, as some consumers will continue to seek the reassurance that dealing directly with a retailer gives them in areas such as product authenticity, return policies and collection options.

So, it is far from certain that e- commerce landscapes in the US and Europe will end up imitating their marketplace- dominated counterparts in Asia. The US is overmalled and overstored. There are currently 1,2. US, according to the International Council of Shopping Centers (ICSC), and the number of malls grew by more than 3. Mall operators are repurposing B malls as A malls, and closing many C and D malls altogether.

Combined, B and C malls total almost 5. As the number of malls has grown, there has been corresponding growth in the number of retail stores. Many department store chains are consolidating and closing stores. Department stores have traditionally served as mall anchors, but they have been challenged on a number of fronts: mall operators have closed some malls and changed others into A malls, e- commerce has seen rapid growth, fast- fashion retailers and outlet stores have provided much competition, and smaller store formats have lured shoppers away from bigger stores. In 2. 01. 6, Macy’s announced that it would close 1. Sears announced that it would close 5. JCPenney said it would close seven stores.

Some specialty retailers have also announced store closures over the past year. The women’s apparel and teen categories have been hit hard. The mid- tier women’s apparel category is struggling with a lack of differentiation in a saturated market.

Lifehacker. Nick Douglas. Staff Writer, Lifehacker Nick has been writing online for 1. Urlesque, Gawker, the Daily Dot, and Slacktory. He lives in Park Slope with his wife and their books.