Seven internet trends shaping retail in 2016

Retailers take note: the Mary Meeker Internet Trends 2016 report came out earlier this month. This is the must read each year to ensure you’ve got a good understanding of the digital trends shaping our future. Meeker, a former Morgan Stanley internet analyst and now partner at venture capital fund KPCB, delivered her 213-slide rich report at the Californian Code Conference, showing how the three billion global internet users today are operating online.

This year (and every year ongoing), we’ve got your back: our team has dissected the report and pulled out the key findings that will impact physical retail and provide the biggest opportunities for growth. With Store Discovery Optimisation at the top of the agenda for a thriving physical retail ecosystem, here are the trends you need to keep top of mind for 2016.

1. The retail [r]evolution

Slides: 56-57, 64

Let’s kick off with some context. This section shows the evolution of retail and the companies that have driven change at each point, from Apple, to the Costcos of the world, to the Caspers of today.

The two key development phases look like this: physical retailers become digital retailers, then digital retailers become data-optimised physical retailers. You will start to see the complete digitisation of the physical retail conversion funnel and Store Discovery Optimisation will be a key part of that.

If properly optimised, physical retail is set to boom. Just look at Warby Parker – they now make more money per square foot in US retail stores than Tiffany’s or Michael Kors ($3K annual sales per square foot).

2. Millennials are where it’s at

Slides: 58-60

Millennials are the most important spenders. Accounting for 27% of the population, they’re the largest generation and their spending power will increase significantly in the next 10-20 years.

3. Get the ‘messaging’ message

Slides: 103-107

Conversational commerce is happening now and it will expand very quickly. Messaging apps are no longer for keeping in touch with friends, they’re platforms for commerce. Asia is leading the charge here: there are 10 million business accounts on WeChat, and about 80% of all users follow one!

As for those millenials, they don’t call. They want to interact with you through messaging. Gen Y are the first generation to prefer chatting to businesses via the web/social rather than over the phone. Gen Z, however, communicate with images. Picture that.

Being discoverable is the first step to engaging with shoppers in these conversations: if they can’t find you, there is no conversation to be had. So make sure you’re discoverable.

Given this, should you rush out and build a chat platform to capture all these potential customers? No. Don’t bother with your own chat applications or new apps designed for chatting with stores – the messaging war has been won and people will not download new apps or use retailer specific ones to “chat”.  You need to be where these shoppers already are: existing messaging apps.

4. Siri, Alexa, help me.

Slides: 120-128

We’ve talked about this previously, but intelligent voice assistants are changing the way consumers search. According to Baidu’s chief scientist, Andrew Ng, at least 50% of all searches online will be through voice or image search by 2020.

This is a product of significantly improved tech and the proliferation of devices with voice recognition capabilities:

  • Computer speech recognition has gone from 70% accuracy to 90% in the last five years
  • 65% of US smart phone owners use a voice assistant

5. Ad-blocking: is your message getting through?

Slides: 47

There are 220 million desktop users with ad-blocking software (up 16% year on year) while mobile users with ad-blocking tools (440 million) is up a huge 94%. Is your advertising even reaching the right people? There is certainly a need for better ads – no denying that. But it speaks to the greater “trusted advisor” principle.

Ad-blocking is a symptom of the tricky and sneaky use of consumer data. This makes trusted advisor business models more important to retailers and brands trying to connecting with shoppers in a respectful way.

6. Drive time = shopping time

Slides: 157-159

This was an interesting one that probably hasn’t crossed your mind: the autonomous car will become a place for people to digest media.

The average urban US worker spends about 42 hours a year sitting in delays on their commute (with the car being in use only 4% of the time). Furthermore, millennials don’t drive like their parents did: only 77% of 16-44 year-olds have their licenses in the US today, compared with 92% in 1982.

If shoppers can discover your physical store whilst on-the-go, and they have a car to take them there, that will drive shopper visits and sales.

 7. The Amazon threat

Slides: 62, 129.

The imminent threat of Amazon to Australian retail cannot be underestimated.

The announcement of Amazon private labelled products should send a shiver down every retailer’s spine. They will undoubtedly destroy some retailers and brands – will yours survive? Now is the time to pay attention and get organised. Don’t take Amazon on at their own game, beat them at yours: data-optimised physical retail. That’s their weak spot.

It’s going to be tough for retailers across the size spectrum to compete on data, particularly against Amazon, without working with companies that specialise in this area. Smaller retailers need a service that utilises data to provide shoppers with the same seamless and predictive experience Amazon delivers.

Now let’s talk about Alexa. iPhone sales peaked in 2015, and it looks like first place in hardware sales growth this year with go to Amazon Echo. The Alexa-enabled Echo device is designed to drive product transactions and Amazon have made it clear that there is no place for other retailers on the Alexa ship. Booodl is about the only company trying to help you with this. Increasing your discoverability and chatting/transacting on mobile devices through existing messaging platforms seem to be the way to win.

When is comes to being innovative, China is worth watching for retail trends as they seem to be ahead of the curve when it comes to mobile habits, particularly in the retail space.

Which of these trends most resonates with your business? We’d love to hear your thoughts in the comments.

Booodl specialises in Store Discovery Optimisation to foster a thriving retail industry by helping retailers, brands and shopping centres compete with online.

If you would like to talk to one of our team about how we’re solving many of the problems this report uncovers, get in touch at or register today at

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