1. Global Trends and Forecasts Planet Retail Ltd | October 2011
2012
By Matthew Stych
Research Director
Planet Retail Ltd | October 2011

2. All images ©Planet Retail Ltd unless otherwise stated.
Global trends and forecasts 2012
Matthew Stych
Research Director
This presentation will give you an overview of the hottest trends in global retailing and examine how these trends may affect the Finnish retail scene in 2012 and beyond.
All images ©Planet Retail Ltd unless otherwise stated.

3. Global trends and forecasts 2012
Growth outlook
Key trends
Multichannel
Small stores
Private label
Internationalisation
Shopper centricity
Summary

4. Global trends and forecasts 2012
Growth outlook
Key trends
Multichannel
Small stores
Private label
Internationalisation
Shopper centricity
Summary

5. Forecasts revised downwardsX
Forecasts revised downwards
The global economy is in a dangerous new phase
Economic concerns spell difficult 2012 ahead
We remain concerned about the economic pressure on our customers
We expect subdued consumer confidence in the developed world

6. The uncertain outlook now threatens to slow Finland’s economic growth
Finland may be hit by weak Europe X
Region’s emerging retail markets hold hope
The uncertain outlook now threatens to slow Finland’s economic growth
Cuts in public finances may have a negative impact on the trend in consumer demand

7. Grocers: shift towards small formatsX
Smaller average baskets, more frequent trips
6.1
5.9
5.9
5.3
4.4
2.2

8. Fashion and leisure lead non grocersX
Fashion and leisure lead non grocers
Weak demand for big ticket items hits electronics and home

9. Global trends and forecasts 2012
Growth outlook
Key trends
Multichannel
Small stores
Private label
Internationalisation
Shopper centricity
Summary

10. Shift to e-commerce and multichannel

11. E-commerce prompts high street shake up
Shift in consumer shopping habits towards online gathers momentum
Company
2015 f Banner Sales (USD million) 1
Walmart
630,834 2
Carrefour
195,888 3
Tesco
155,420 4
AEON
130,990 5
Metro Group
129,889 6
Amazon
126,901 7
Schwarz Group
125,691 8
Seven & I
115,682 9
Costco
112,900 10
Auchan
110,597
Source: Planet Retail Note: Forecasts

12. Entertainment faces transformationX
Entertainment faces transformation
Amazon’s success has helped decimate bricks & mortar Entertainment

13. Amazon’s ‘Earth’s Biggest Selection’ strategy
Amazon is building its presence in other sectors

14. Mobile checkouts growing
Role of apps and mobile websites growing in importance
New online services, wireless solutions and different terminal devices have increased the diversity of customers' needs and purchasing habits

15. Rising importance of multichannelX
Rising importance of multichannel
Click & Collect a hit with busy consumers
We will develop an integrated shopping experience that encompasses new ways in which customers want to interact and shop
Terry Duddy CEO

16. Multichannel poses threat to online
Pure play online retailers exploring bricks and mortar solutions

17. Big plans for small stores

18. Bill Simon President and CEO Walmart US
Big plans for small box
Small store development rising on retailer agenda
“Over the next few years, we will introduce new formats to help us enter new markets.”
Bill Simon President and CEO Walmart US

19. Downsizing large format footprint
Retailers finding alternatives for large format outlets

20. Small stores require new thinking
Smart solutions to buffer margins
Kevin Peters Office Depot
"Smart retailers are finding ways to shrink their footprints."

21. Private label focus on quality

22. Private label set for further growth
Private label penetration to increase across virtually all markets
Note: Based on selected mature and emerging markets; f - forecast. Estimated shares of MGD sales; may exclude fresh produce.
Source: Planet Retail Ltd - partly based on Nielsen and GfK

23. Evolving model for hybrid shopper
Modern tiered strategy serves increasingly diverse consumer behaviour

24. Retailers exploring themed niches
Proliferation of sub-brands is expected across Europe
Kids
Organic
Special diet
Healthy Eating
Ethical
Regional
Eco friendly
Ethnic

25. Re-inventing the standard tier
Focus on quality and endorsement
“We’re sending a clear message that Asda will now drive as hard on quality as it does on price.”
Andy Clarke CEO, Asda

26. Kesko: exploring niches
Kesko driving private label with new SKUs and exploring niches
Sales of Pirkka products increased 39% in H1

27. S Group: aiming high
Private label development a priority
Targeting 20% PL penetration
EUR1 billion sales
Developing new products will bring fresh ideas to others in the same group of manufacturers

28. Director of Coop Purchasing & Category
New directions in Nordics
Fresh approaches to private label being tested
We are creating an additional dimension in the development of our own brands
KF,
Director of Coop Purchasing & Category
ICA Norway increased PL from 9.3 to 10.0% in 2010

29. New wave of internationalisation

30. Retailers re-examine overseas option
Pursuit of growth lures retailers out of domestic comfort zones

31. New set of retailers go international
Second tier players look at new territories

32. Toby Lenk, President of E-Commerce, Gap
E-commerce goes cross-border
Retailers will increasingly launch cross-border e-commerce sites
Company owned stores
Franchised stores
Online only
No presence
“Online sales are a way to test the market for brands outside of the US.”
Toby Lenk, President of E-Commerce, Gap

33. Connected world drives rapid growthX
Connected world drives rapid growth
International development no longer exclusive to giants

34. Retailers in Finland look overseasX
Retailers in Finland look overseas
Recovery in Russia and Baltics set to drive international expansion

35. “...further significant opportunity”X
Nordic markets will attract attention
Inward investment may rise as international retailers look for growth
“...further significant opportunity”

36. Shopper takes centre stage

37. Retailers seeking customer insights
Ten Trends
Loyalty scheme launches continue
“There is a need to really understand our customers and create interesting and compelling offers, which are more tailored to meet local needs.”

38. Engaging with social networks
Retailers engaging with social networks
“We recognise that we missed the opportunity to engage with the online community.” 38

39. Marketing goes location-based
Retailers following the consumer
“Our hope is to engage with our customers in a fun and stimulating way while showcasing our assortment of fashion accessories.” 39

40. Summary Prepare to fight harder for shopper as recovery stalls
Shift to online and multichannel
Develop small store proposition
Expand private label
Examine international options
Put the shopper at the core

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