Retail Marketing Trends in USA and Their Effects on Consumers and the Global Workforce

Retailing includes all the activities involved in selling goods and services directly to the final consumers for personal, non-business use. Over the years, retail marketing has gone through significant change in the western world. However, few articles exist summarizing the mass of information on the current trends in retailing. This paper attempts to do just that for practitioners by highlighting the trends that best describe the current state of retailing in the USA. The paper further reviews the possible effects of these retail trends for consumers and the workforce. The choice of US as the focus for the paper has been deliberate as US serves as a technological beacon for the rest of world in the emergence of business models in retailing. Business Environment in USA Retailing All retail markets are being driven by consolidation and the requisite need for efficiency. For example, the hardware category is being driven by Home Depot and the grocery category is being driven by Walmart. These large retailers are using technology to organize and make the supply chain more efficient. Both are asking the manufacturers to do more. For example they want more in-store support and help with category management. They want more straight through processing with their suppliers. These same retailers operate on an everyday low price profit model based on driving volume through their stores. This continuous pressure and emphasis on low prices tends to commoditize the products they sell, lessening the value of product features and brands. This has put tremendous pressure on the manufacturers to truly differentiate their products and to effectively communicate to the consumer their value. The size of these big box stores makes ignoring them impossible but their practices and operational demands have upset and initially complicated the manufacturer's traditional operating practices. However, manufacturers are reacting and changing to effectively deal with the demands. This benefits everyone, including their traditional channels of distribution and their end user customers. Whether the benefits also reach the workforces of these manufacturers may be a particular point of interest. Balancing this is a continuing consolidation on the supply side as well. For example, the 12 largest meat packing companies have 79 % of the revenue. This provides the scale for the suppliers to keep pace with the technology to operate the business efficiently and to develop products for the evolving These manufacturers are also organizing their supply chains to be more efficient. On-line technology continues to improve. Although home delivery of groceries has not lived up to the original hype, B to C on-line buying in general continues to grow. Eventually a workable model will evolve for groceries. Originally, many thought a click-only model would challenge the retail industry. Now it appears that the brick and click model offers the most promise. This puts current retailers in a good position because they already have a distribution network to leverage. The consumer is changing as well. In the past 20 years the number of people speaking Spanish in their homes in the US has increased by 60% and the number of people watching cable TV has more than tripled. These are signs of growing fragmentation. Another trend is the emergence of a new consumer. These consumers are more sophisticated (at least 1 year of college education), have more discretionary income (household income of over $50,000) and have greater access to information (have a computer in their homes). It is expected that these consumers will make up over 52% of the population by 2005. These consumers demand more choice but have less time to shop. They are looking for quality information over quantity of information. They value convenience because these consumers typically come from dual income families with little spare time. And finally they expect superior service. …