United States retailing market: Volatile economic growth causing more Americans to become increasingly conscious of their spending
The Future of Retailing in US to 2017 - a new market research report on companiesandmarkets.com
PR-Inside.com: 2014-04-21 20:54:03
Despite being the world´s largest economy, the US has faced volatile economic growth following the global financial crisis. As a direct result of their squeezed purse-strings, American consumers have become increasingly conscious of their spending, leading to a rise in ´bargain hunting´.
Since the recession, US consumers have been consistently skeptical about their futures, and the growth of their incomes. Consequently, they are now spending much more time researching the market prior to making purchases, comparing the prices of competing retailers to find the best possible deals.
In addition to simply visiting different retail outlets, price-conscious consumers are increasingly turning to social networks to find the best prices; this may simply be their existing network of friends or family, but is increasingly being facilitated by social networking and the product review sections of popular websites. The ever-expanding capabilities â and ever-increasing affordability â of mobile phones is another key driver of this trend, with cost-savvy consumers able to utilize this portable technology to compare competing retailers´ prices before they take goods to the checkout, or simply to make purchases on the move. Thus, retailers have moved to capitalize on this trend, and have been setting up mobile-friendly sites to capture the growing m-commerce market.
A knock-on effect of the increasingly cost aware consumer in the US is that, despite its long heritage of big box retailers and larges stores, the recession-wracked country is no longer a suitable environment for such retailers to flourish. Firstly, the working capital costs attached to managing such large format stores is very high compared to those of online stores, and that â coupled with the decrease in consumer demand â is not working well with retailers. With consumers now able to compare prices and even make purchases with the devices in their pockets, the substantial overheads that come with traditional big box retailing no longer outweigh the benefits of large and varied stock selections.
Reacting to this trend, large retailers around the country have been closing larger format stores and are concentrating on opening smaller format stores. For example, the electronics retailer Best Buy closed approximately 50 stores in the US as a result of declining sales. Furthermore, many department stores are also planning to shut down their stores as they become unviable in this new post-recession, technologically enhanced age.
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