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The Emergence of Retail Trends Within the South African Context

Retail Marketing and Sales

“South Africa is an emerging market and the retail space is clearly different from that of the more developed countries in Europe and North America.

The local market has to cater for a lower-income demographic and is clearly segmented according to price. “We also have a more shopping centre-oriented market as opposed to the international market where high street shopping takes centre stage,” says Jonathan Katz, Managing Director of South Africa’s leading organic fashion brand, Earthchild and Earthaddict Clothing, offering high quality children’s and women apparel.

Jonathan outlines how factors such as fair trade, ethical consumerism and sustainability are the major trends in the retail space at the moment. “Now more than ever retailers need to utilise CRM and social media – entering into direct dialogue with customers to ensure brand understanding and customer return visits,” says Jonathan.

With the always-on internet access that such a growing proportion of the public is now enjoying, it has become incredibly easy to share information about a brand to a massive audience. It’s important for retailers, then, to ensure they know what people are saying about their brand and be in a position to respond to happy or unhappy customers in a meaningful way.

What does Fair Trade actually mean?
The Fair Trade movement promotes standards for fair labour, environmentalism, social policy, fair pricing and community development.

It is a trading partnership, based on dialogue, transparency and respect that seeks justice in production and trade processes, facilitating the empowerment of small-scale farmers and farm workers enabling community upliftment.

Right now, the biggest factors affecting purchasing behaviour are:

  1. Differentiation,
  2. Fashionability
  3. Quality and value for money
  4. The basics of customer service
There has also been a noticeable growth in new shopping centres in the last few years. Jonathan predicts that many will struggle and believes that the larger regional shopping centres will dominate for the foreseeable future, while the smaller one’s will find conditions more challenging. “Within South Africa, there are still some areas that are under serviced, so opportunity exists for new shopping centres here, but the main city centres are currently over-serviced,” says Jonathan.

Lifestyle centres have also sprung up and are generally smaller without necessarily being viewed as pure shopping destinations, offering a mix of food and entertainment as its main draw cards. Shopping centres have a much more diverse offering, ranging from supermarkets to fashion and other retail stores to appeal to shoppers.

Looking into the future, Jonathan comments on how a big move towards online shopping and interesting promotions similar to the Groupon concept will emerge as well as the increasing importance of customer service taking the new Consumer Protection Act into consideration with the public’s expectations of good customer service.

“It’s always insightful to compare the appearance of display windows with leading international brands that spend a fortune on creative, eye-catching window displays,” says Jonathan. With more leading international brands coming to our shores every year, it is likely to force the local market to up its game.

A way to boost the shopping experience for the consumer is to extend a wider variety of food court offerings that aim to offer healthier or organic food options.

Differentiation is another important aspect of competition and the four P’s including the fifth, to whom many refer to as clever packaging together with a great merchandising system (creative and eye-catching store displays) is a great way to differentiate from competitors and catch the eye and attention of consumers.

Jonathan says that a brand is everything. “It creates aspiration and the product personality. A product without personality is like a bicycle without wheels so brand marketing should always take centre stage – from this, specific product marketing activities can help to boost sales, but only once effective brand marketing has educated customers about the intrinsic values and benefits of the brand.”

Lastly, we are all motivated to purchase certain products and services for a reason. For some, there are ethical and sustainable values that are embraced by certain products and brands. Jonathan mentions how the forerunner on this was definitely Anita Roddick and the Body Shop – they introduced the concept of ethical consumerism as we understand it today to the mass market.

“We have all become more aware of brand ethics and principles, and I believe that those retailers who offer ethical products will be a step ahead of their competition as well as have an additional product or service offering. Ethical purchases also offer an opportunity for consumers to see how their money is being used to do good.”

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