THE FUTURE OF RETAIL: 2014
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The document discusses the decline of traditional retail in favor of e-commerce, highlighting that online sales are driving nearly all retail growth in the U.S. and that major retailers like Amazon are capturing significant market share. It notes that while certain sectors such as electronics and clothing are experiencing growth online, companies like Best Buy and J.C. Penney are struggling with in-store sales. The shift to digital retail is a global trend, with significant impacts seen in markets like China and India.
THE FUTURE OF RETAIL: 2014
- 1. THE FUTURE OF RETAIL: 2014 BI Intelligence
- 2. IsThis How People Really LikeTo Shop? Image: Reuters
- 3. OrThis? Images: Kim Bhasin / Business Insider
- 4. Let’s Face It —The Old Retail Model Is Dying Image: Brian Sozzi / Belus Capital Advisors
- 6. Hundreds Of Retail Stores Are Closing
- 7. Because Store Sales AreTanking
- 8. Holiday Quarters Have BeenTerrible For Physical Retail
- 9. Where Are Shoppers Going?
- 11. “We’re in the midst of a profound structural shift from physical to digital retail ... it’s happening faster than I could have imagined. ” — Jeff Jordan, partner at Andreessen Horowitz, January 2014
- 12. E-Commerce Is Driving Nearly All Retail Growth In US
- 13. 1 In 20 Retail Dollars Are Already Online
- 14. Mobile Is Also Gaining Fast
- 15. ‘New Retail’ Is Nearly EqualTo Old Guard In MarketValue
- 16. Venture Capital Is Cashing In
- 17. Amazon Continues GrowingVery Quickly
- 18. But Other Retailers Are Also Growing Online Sales
- 19. Amazon Got Started With Media Sales Amazon Is Now ~14% Of All E-Commerce
- 20. The Signs Are Clear — E-Commerce Is Booming. Shippers Were Overwhelmed By The MassiveVolume Of E-Commerce Orders Over Christmas 2013 Images, Right: Reuters
- 21. TheTop Categories — Electronics, Media, Clothing
- 22. Let’s Look At Some Of The Retail Categories Individually
- 24. Best Buy IsVulnerable. 85% Of Sales From Electronics.
- 25. Best Buy Offline Sales Plummeted 15% LastYear BI Intelligence Estimate
- 26. All Of Best Buy’s Growth Is Online BI Intelligence Estimate
- 27. Amazon Was Once SmallerThan Best Buy. Not Anymore. Amazon Already 1.7X Best Buy
- 29. Media Is StillTheTop E-Commerce Category ~$25 Billion
- 30. Media Sales Are Going Digital
- 31. Benefiting Apple And Amazon
- 32. CLOTHING AND ACCESSORIES Image: Reuters
- 33. MoreThan 13% Of All Clothing Sales Now Occur Online
- 34. J.C. Penney IsVulnerable. 83% Of Its Business Is Clothing And Accessories.
- 35. In-Store Sales At J.C. Penney Declined 10% LastYear BI Intelligence Estimate
- 36. Online Is Growing, But Overall J.C. Penney Still InThe Red BI Intelligence Estimate
- 37. Gap Has Done Better BI Intelligence Estimates
- 38. 16% OfThe Gap’sTotal Retail Sales Are Now Online BI Intelligence Estimates
- 39. HOME AND FURNITURE Image: Reuters
- 40. 15% Of All Furniture Sales Now Occur Online
- 41. Helping FuelThe Rise Of Home Goods Online Retailers
- 42. FOOD AND BEVERAGE Image: Reuters
- 43. For Groceries, Online Sales Are Still A Blip
- 44. DespiteThe Early Efforts Of Amazon And Others Image: Reuters
- 45. What AboutThe ‘Everything Retailer,’ Wal-Mart? Image: Reuters
- 46. Some Perspective. Wal-Mart Is Still Much Bigger Than Amazon.
- 47. Wal-Mart’s Advantage Is Still In Physical Retail Wal-Mart still has 4,100 stores within five miles of two-thirds of the U.S. population — The Wall Street Journal, October 2013
- 48. Online Is Still Just 2% Of Walmart’sTotal Sales BI Intelligence Estimates
- 49. But Sales Growth Is Coming From Online BI Intelligence Estimates
- 50. And Walmart Is Investing In Social And MobileTech R&D
- 51. Retail Is About Offering PeopleThe Services And ProductsTheyWant — OnThe Devices And MediaThey Use Image: Amazon
- 52. The Web 52% of all retail sales areWeb- influenced
- 54. Especially iPhones And iPads. ~75% OfTraffic. iPad iPhone Android Phone Android Tablet Other 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Source: Monetate Ecommerce Website Traffic By Mobile Pla orm
- 55. Mobile Is Now ¼ Of All E-CommerceTraffic … PC Tablet Smartphone 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Source: Monetate Ecommerce Website Traffic By Device
- 56. 0 20 40 60 80 100 120 140 160 Am azon eBay W al-M art Apple Target BestBuy The Hom e Depot Ticketm aster Etsy Low es (Millions) Source: comScore Leading Retailers' Digital Audience Popula on By Device Desktop Only Desktop + Mobile Mobile Only Retailers Are Finding Huge Audiences On Mobile …
- 57. … And On Social Networks
- 58. What DoToday’s Customers Want? Image: Amazon
- 59. They Want Price And Convenience Convenience Price
- 60. AndThey Want Individualized Services And Offers
- 61. They WantTo BuyThings On Mobile! PayPal Does ~$30 Billion In MobileTransactions PayPal Mobile Braintree Mobile* $0 $5 $10 $15 $20 $25 $30 $35 2008 2009 2010 2011 2012 2013 U.S.DollarsInBillions *PayPal counted a small por on of Braintree's transac on volume as its own in the last 12 days of Q4 2013. Source: PayPal PayPal Mobile Transac on Volume (Including Braintree 2013) PayPal purchased Braintree in late 2013.
- 62. Starbucks Payments App Does It All Images: Starbucks AndSquare
- 63. Which Is Why It Is So Successful: $1 Billion In Annual Volume!
- 64. The ShiftTo Online Retail Is Global Image: Reuters
- 65. Alibaba Drives $157 Billion In Gross MerchandiseValue
- 66. China’s JD.Com Saw Sales Boom LastYear
- 67. Mobile Will Account Of 15% Of Chinese E-Commerce Sales
- 68. E-Commerce IsTaking Off In India,Too
- 69. Henry Blodget CEO & Editor-in-Chief Tony Danova, Research Analyst Marcelo Ballvé, Editorial Director BI Intelligence is a subscription service from Business Insider that provides in-depth insight, data, and analysis of digital industries. More info at intelligence.businessinsider.com Cooper Smith, Research Analyst John Heggestuen, Research Analyst Emily Adler, Senior Research Editor Mark Hoelzel, Research Analyst