The retail sector has been a vibrant and dynamic part of New Zealand’s economy for decades, with department stores at the forefront. Department stores typically offer a wide variety of clothing, cosmetics, jewellery, and housewares, in addition to services such as home delivery and online shopping. But how is the New Zealand department store industry faring in 2020?

An Overview

New Zealand’s department store landscape is still dominated by some of the biggest names in the business, such as Farmers and The Warehouse. However, the industry is not immune to the challenges faced by retailers around the world. The continued growth of online shopping has had a significant impact on the industry, with many stores struggling to remain profitable in the face of increased competition. Additionally, the changing preferences of shoppers – particularly younger customers – have impacted the industry, with many traditional department stores facing pressure to adapt their business model.

Challenges Faced by Department Stores

The rise in online shopping has had a significant impact on the New Zealand department store industry, with many stores struggling to compete with the convenience and lower prices offered by online retailers. Additionally, the decline in traditional shopping habits has resulted in a decrease in foot traffic, leading to less sales overall. These challenges are compounded by the rising costs associated with running a brick-and-mortar store, as well as the need to invest in digital marketing in order to remain competitive.

Another challenge faced by department stores is the need to adapt their business model to meet the changing preferences of shoppers. Younger customers are more likely to prefer online shopping, and they are also more likely to be drawn towards stores that offer a unique and personalised shopping experience. This has led to an increase in the number of multi-speciality stores, as well as an increase in the number of stores offering customised services such as personal stylists and tailored clothing.

Opportunities for Department Stores

Despite the challenges faced by the industry, there are still plenty of opportunities for department stores to remain competitive in the New Zealand market. One key area of focus is the use of digital technology to modernise the shopping experience. By investing in technology such as mobile apps and virtual fitting rooms, department stores can provide a unique and engaging shopping experience for their customers. Additionally, many stores are investing in customised services such as personal stylists and tailored clothing in order to stand out from the competition.

Department stores have also been utilising data and analytics to improve their offerings. By understanding customer preferences and buying behaviour, stores can tailor their product range and promotional activities more effectively. Many stores are also investing in customer loyalty programmes in order to increase repeat business and encourage loyalty.

Finally, department stores can offer customers added value through services such as home delivery and click-and-collect. These services not only provide convenience but can also help to reduce the cost of traditional shopping.

Conclusion

The New Zealand department store industry is facing significant challenges in 2020, due in part to the rise in online shopping and changing customer preferences. However, there are still plenty of opportunities for stores to remain competitive, such as investing in technology to modernise the shopping experience, using data and analytics to tailor their product range, and offering customers added value through services such as home delivery and click-and-collect.

In order to stay ahead of the competition and remain profitable, department stores in New Zealand must be prepared to embrace new technologies, adapt their business model to meet customer needs, and offer customers a unique and personalised shopping experience.

Key Takeaways:

• Online shopping has had a significant impact on the New Zealand department store industry.
• Department stores must embrace new technologies and adapt their business model to meet customer needs.
• Data and analytics, customer loyalty programmes, and added value services can help department stores remain competitive.

Overall, New Zealand’s department store industry is still a vibrant and dynamic part of the economy, and there are opportunities for stores to remain competitive in the future. In order to do so, however, stores must be prepared to embrace new technologies, adapt their business model, and offer customers a unique and personalised shopping experience.