What is New Retail? New Retail Review

introduce

New retail, in a narrow sense, refers to service-oriented retail with two-way traffic. In a broad sense, all retail brands, as long as they innovate business formats and experience, can be labeled as new retail.

Background

In 2016, Jack Ma proposed the concept of "new retail" at the Yunqi Conference. He said: There will be no e-commerce in the future, only new retail, which means that online, offline and logistics must be combined to create real new retail.

Development History

"Boundaryless retail" is a concept proposed by Liu Qiangdong before this year's Double 11.

Later, someone proposed the "4 2s": that is, at the right time and in the right place, the right goods are waiting for the right people, that is, "know the people, know the goods, know the time, and know the place."

In February 2017, Alibaba CEO Zhang Yong was asked by the media to explain new retail at the press conference of Alibaba and Bailian’s cooperation. His answer was: “New retail does not exist in this world. New retail is created by people. Today we are in the process of walking this path. Any in-depth and easy-to-understand qualitative description is incomplete. Ultimately, we must rely on practice and continuous exploration.”

Reasons for development

1. Industry factors

Price is no longer an advantage of online e-commerce. The entire retail industry has returned to the essence of business. Reducing costs and improving efficiency are the fundamental pursuits of all participants. The traditional retail industry has begun to transform and upgrade to new retail.

2. Online factors

After several years of rapid growth, the online incremental space for e-commerce has begun to shrink, the growth rate has slowed, the existing market is dominant, and the ceiling of traffic business has gradually emerged. Online businesses have turned to offline to seek new growth space, which will inevitably lead to the deep integration of online and offline businesses.

3. Offline factors

Traditional offline retailers are facing numerous difficulties and have begun to transform; innovative companies are constantly emerging and new species are entering the market; the pace of transformation and innovation is accelerating, reducing costs and increasing efficiency has become the main goal, and unmanned retail has become a trend.

4. Technical factors

New technologies continue to emerge and mature, and "black technology" has become the core force driving retail reform, among which big data is the core of all technologies. The rapid development of science and technology has provided the possibility of innovation in the retail market, and behind the continuous technological innovation is the continuous exploration and unremitting pursuit of data by enterprises.

5. Market factors

Consumer demand advocates leading the market trend, consumption has become the main force driving economic development, and demand-driven consumption upgrades have become the main theme; quality, personalization, and emphasis on experience are its main characteristics.

6. Payment Factor

Mobile payment is becoming more and more popular and closely connected with consumers' daily lives, becoming a lifestyle habit. The increasing convenience and efficiency of payment is an important factor driving retail innovation.

7. Capital Factors

Capital gathers at the hotspot to boost innovation. Capital continues to chase concepts, and "unmanned" retail and new retail species have become new investment hotspots. The total amount of financing continues to rise (from the disclosed data of more than 5 billion yuan in 2017), and the amount of single financing also continues to increase.

8. Policy factors

New retail responds to the requirements of consumption upgrading and supply-side reform put forward by the country. The innovation and transformation of retail formats are conducive to promoting people's livelihood construction. National policies strongly support the transformation and upgrading of the retail industry.

nature

New retail is the product of technological empowerment and the evolution of user thinking.

On the one hand, users are represented by data, which becomes a mapping and embodiment of individual behavior, and people are reconstructed into digital individuals;

On the other hand, individual will rises, uniqueness becomes a rigid need, and users actively seek aesthetic and emotional consumption that can provide personalized satisfaction.

The essence of new retail is to use big data to support scenario insights and a new credit relationship and new efficiency system based on experience design.

New retail "new" features

1. New technologies. The first is data mining, which may seem simple, but the data, algorithms and coordination of all parties behind it have changed the original management system. The second is that it includes many technologies, including Internet technology, face recognition technology, and many other technologies.

2. New relationships between people and enterprises or between customers. The first is interaction. Compared with the original offline retail stores, it is interaction. From the very beginning before selection, during selection, or before, during and after sales, there is interaction, which is the relationship of the community.

Secondly, on this basis, it has evolved into personalization, small batches, and quick response, which is C2B or B2M. Its manifestation in this area is different from the original B2C.

3. New scenarios. From the earliest online or offline, now it may be the entire network. You can see stores online, you can also go to offline, there are even some stores within stores, and even tangible and intangible ones.

feature

Channel integration means the deep collaboration and integration of multiple channels into “omni-channel”.

Retailers must not only create sales venues in various forms, but also achieve deep closure of multi-channel sales scenarios in order to meet customers' needs to buy whenever they want.

New retail feature 2: digital operations.

The digitalization of the retail industry includes customer digitalization, product digitalization, marketing digitalization, transaction digitalization, management digitalization, etc. Digitalization is achieved through IT systems. In all digitalization strategies, customer digitalization is the foundation and premise.

New retail feature three: store intelligence.

New retail feature 4: socialization of commodities.

After the new retail digitizes customers, customers will no longer visit your physical stores, but will feel that your stores have few items and lack categories when they shop online. This is the challenge of category management in the new retail era, which requires merchants to restructure their supply chains to solve.

New retail feature five: intelligent logistics.

Traditional retail only allows customers to consume in-store and pick up and sell goods immediately. New retail requires that customers can buy goods around the clock, through all channels, and at all times, and can also realize in-store pickup, same-city delivery, express delivery, etc. This requires connecting to a third-party intelligent delivery and logistics system to shorten the delivery cycle and destock.

How to do new retail

1. Business model: Product development, marketing, and services will be different from traditional retail. Merchants need to move their products and services online to make them more accessible to consumers.

2. IT system: New retail stores should be built on the basis of IT systems and big data.

3. Operation methods: In the new retail era, application methods including the working methods of stores, shopping guides and store managers, and marketing promotions will all change.

4. Supply chain: After store customers are digitized, such as users of Haixi Mall or Metro Global Frog, the goods they need can be integrated through new retail. This involves supply chain issues, which cannot be achieved by a single merchant. In the future, the supply chain must be shared.

5. Finance: There must be financial support behind the supply chain. After the store’s new retail transformation is completed, the business will be linked to finance.

References

• 1. What are the five characteristics of new retail? Illustration of new retail characteristics: hishop [cited on 2018-03-15]
• 2. What is New Retail? An article will give you a thorough understanding: Sohu [cited on 2018-06-29]
• 3. Characteristics and eight factors and eight features of “new retail”: Sohu [cited on 2018-02-28]