Trends in Non-Store Retailing Essay
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The article I’ve chosen for this assignment is titled “Forces Driving Change in 2011: From crowd-sourced shopping to accessories to new ways to get green: The 10 trends that will define opportunity next year. ” The article was published in Entrepreneur Magazine’s December 2010 issue (http://www. entrepreneur. com/trends/index. html) and was written by Jennifer Wang and Kara Ohngren. This article has several points to make, including the changes in demographics making baby boomers again the target of advertising and sales.
The most interesting trend though is sales through social networking. The social networking phenomenon grows and with it, opportunities for selling are limitless. Although many of us are still feeling the pinch of the recession, studies pursued by the National Bureau of Economic Research say that our economy has been in recovery mode since June 2009. A major reason this upturn hasn’t been as evident as one might expect is that approximately 71% of consumers and business owners are waiting for economic statistics to rise before they’re spend their hard earned money or hire more employees.
Eric Jackson, an innovation specialist and VP of research and development at Gap International, a global management consulting firm in Philadelphia thinks that this plan is imprudent. “The world is screaming for innovation, and companies can capitalize on the resources they already have to spark the next possibilities. ” The innovation that the world seems to be screaming for is online/digital stores. As the industry increasingly shifts online, opportunities are emerging.
For example, the app markets of both Apple and Android markets have proliferated from practically nil to billions of dollars in just a few years. The reason for this rapid success is that their customers, Smartphone owners, love having access to a multitude of Wi-Fi finders, flight status updaters, local restaurant finders, budget booking assistants, translators and more. It’s instant gratification and a tool that makes that person’s life easier and more organized in their eyes, so of course they jump on these markets.
Also, nearly half of the people in the United States are now part of an online social network. People who are online spend money and those on social networks spend more time online. This leads to bigger sales. The average in the first quarter of 2010 was $67 per person if the person was a heavy Facebook user. The first users of these sites for sales used a method of flash sales. They offered deep discounts for users and they depend on the conversations on the site to drive sales. Using the “recommended by a friend” approach works.
Many people follow companies, products, and brands online, Twitter being one social networking site mentioned. There are now collective buying sites such as Living Social and Groupon, which offers local deals online every day through email. This deal can be passed on to others through email and those social networking sites. These sites are in most major urban areas. This leads to one major issue. Companies no longer have complete control over their brands. This is now in the hands of the social networks and the people who use them.
While it can help build a brand, it can also create havoc for a company. Marketers need to understand the trends that social networking create. These sites can either help with marketing or they can damage the reputation of a company. The word spreads quickly and often is picked up by media for dissemination in the news. Knowing the power of the social network is knowing how to get up and running or improving the sales for a company, but it also means providing the customer service needed to maintain reputation.