Commerce 2040 Presentation - Compiled - Final

Commerce 2040
The Future of the Store in a Digital World

2
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from Euromonitor International and cannot be used or stored with
the intent of republishing, reprinting, repurposing or redistributing
in any form without explicit consent from Euromonitor International.
For usage requests and permission, please contact info@Euromonitor.com.
The data included in this document is accurate according to Passport,

Euromonitor International’s market research database, at time of
publication: September 2021
© Euromonitor International
3
Euromonitor International
The world’s leading provider for global business
intelligence, market analysis and consumer insights.
From local to global and tactical to strategic, our research
solutions support informed decision making.
4
Commerce 2040
By 2040, physical stores will completely change. The shift

towards e-commerce is forcing retailers to rethink the
purpose and use of stores for a digital era.
COMMERCE 2040: THE FUTURE OF THE STORE IN A DIGITAL WORLD 5
Keynote and
Regional
Presentations
Michelle Evans Bob Hoyler Hianyang Chan Paula Goñi
Senior Head of Global Consultant, Senior Consultant, Senior Analyst,
Digital Consumer North America Asia Pacific Latin America
Research
Panel
Barry Thomas Emily Xu Jason Goldberg

Head of International Chief Marketing Officer Chief Commerce
Customer Marketing and Mitchell Gold + Strategy Officer
Future of Commerce Bob Williams Publicis Communications
The Coca-Cola Company
The Future of the Store
in a Digital World
Michelle Evans, Senior Head of Global Digital Consumer Research
7
How retail has – and has not –

changed
Profiting from the distribution of consumer goods hinges

on a successful strategy built around six core principles.
8
What drives retailers to What drives consumers to

explore new tools for shop for products
selling products? differently?
Cutting-edge technologies Heightened consumer demands

New business models Desire to experience more
Emerging retail channels Expectation for anytime, anywhere commerce
New competitors and partners Digital tools that empower
Explosion of consumer data Rise of values-based buying
9
Preferred Delivery Features, 2021
Free delivery
Free returns
Some of the biggest
Package tracking
retail trends are at odds
Choose a delivery day/time
Consumers shop online to save money and
time, but that convenience has operational Text/email update notifications
and environmental costs.
Next-day delivery
Same-day delivery
0% 50% 100%
% of digital consumers
Source: Euromonitor International Voice of the

© Euromonitor International Consumer: Digital Survey, fielded March 2021
10 competing forces reshaping the future of retail
Consumers vs Retailers vs Efficiency vs

Value vs Values
Companies Brands Effectiveness
Personalisation Choice vs Physical vs Consumerism

vs Privacy Curation Virtual vs Minimalism
Exclusivity vs
Human vs Bot
Accessibility
10 competing forces reshaping the future of retail
Consumers vs Retailers vs Efficiency vs

Value vs Values
Companies Brands Effectiveness
Personalisation Choice vs Physical vs Consumerism

vs Privacy Curation Virtual vs Minimalism
Exclusivity vs
Human vs Bot
Accessibility
12
Human versus bot
Digital Consumers: Comfort Level with New Technologies, 2021
31% 42%
Robots preparing an entire meal at a Robots guiding me to products in a
restaurant store aisle
© Euromonitor International Source: Euromonitor International Voice of the Consumer: Digital Survey, fielded March 2021
13
Personalisation versus privacy

Digital Consumers: Attitudes and Perceptions Towards Privacy, 2021
22% 55%
Feel in control of my personal Companies should not be able to sell my
information personal data to a third-party
46% 32%
Concerned with the volume of personal Companies should provide more value
data companies know about me in exchange for data
© Euromonitor International Source: Euromonitor International Voice of the Consumer: Digital Survey, fielded March 2021
14
Choice versus curation

Subscription Service Motivations, 2021
Convenience
Enjoy the products and/or brand
Able to try a variety of new products
I was given a subscription as a gift
Recommendation from friends/family
Receive tailored products based on my preferences
To save money
Novelty/to try something new
I do not have time to shop
0% 10% 20% 30% 40% 50%

Source: Euromonitor International Voice of the Consumer: Digital Survey, fielded March 2021 % of digital consumers
15
Value versus values

Percentage of Digital Consumers Who Like Political and Social Issues Activities, 2021
to Find Bargains
70%
60% Buy from brands that support

50% social and political issues that
are aligned with my values
40%
30%
Boycott companies that don't
20%
share my social and political
10% beliefs
0%
2015 2016 2017 2019 2020 2021 0% 10% 20% 30% 40%
© Euromonitor International Source: Euromonitor International Voice of the Consumer: Lifestyles Survey
16
Physical versus virtual
Global Retail Channel by Compound Share of Global Sales: Goods Bought in Store
Annual Growth Rate (%), 2011-2021 100%
90%
E-Commerce 80%
70%
Homeshopping
60%
50%
Store-Based Retailing
40%
Direct Selling 30%

20%
Vending 10%
0%
-5% 0% 5% 10% 15% 20% 25% 2010 2015 2020 2025
© Euromonitor International Source: Euromonitor International

Scenario: Digitally devised
18
Key themes that will shape the future store
Seamlessness Convenience
34% shop online to order at any 43% shop in store to receive
time from anywhere immediate purchases
Experiential Personalisation
54% shop in stores that create 24% look for tailored shopping
engaging experiences experiences
© Euromonitor International Note: Percentage of digital consumers from Euromonitor International Voice
of the Consumer: Lifestyles Survey, fielded January and February 2021
19
Key themes that will shape the future store
Sustainable Premiumisation
46% use sustainable packaging 32% are willing to pay more for a
specialty or new variety product
Shareable Community
25% have made a purchase via 41% plan to be more engaged in the
social media platform community in the next five years
© Euromonitor International Note: Percentage of digital consumers from Euromonitor International Voice
of the Consumer: Lifestyles Survey, fielded January and February 2021
Importance of these themes varies by region
Asia Eastern Latin North Middle East Western

Pacific Europe America America and Africa Europe
▪ Seamlessness ▪ Personalisation ▪ Sustainable ▪ Convenience ▪ Experiential ▪ Sustainable
▪ Convenience ▪ Convenience ▪ Shareable ▪ Seamlessness ▪ Personalisation ▪ Experiential
▪ Shareable ▪ Sustainable ▪ Convenience ▪ Experiential ▪ Seamlessness ▪ Premiumisation
21
How the retail store of

tomorrow will evolve
Retailers will leverage tech to remove the hassles of
shopping for mundane items while tapping into the innate
desire and curiosity to experience specific products.
22
Convenience store Experiential centre

Sell impulse products and irregularly Experiences built around products that
purchased convenience goods require more consideration
Technology plays a starring role in both Focus on testing functionality or brand

back-end and front-end operations engagements—not acquiring products
In the future, there will be two main types of physical

retail spaces.
23
Check in before check out Contextualised shopping

Identifying consumers at check in rather Testing products in a virtual incarnation of
than check out the final environment
Experiential ticket entry Community collabs

Creating unique branded experiences to Becoming a place where store associates
generate new revenue streams and shoppers co-create products
Street view of the convenience store
Aisle of the convenience store
Front-end of the convenience store
Street view of the experiential centre
Entrance of the experiential centre
An inside view of the experiential centre
An inside view of the experiential centre
Image source: Arc’teryx Equipment
31
Arc’teryx Equipment, a high-

performance apparel company,
opened a flagship store in
Shanghai, which leverages
technology to create a more
immersive experience.
Retailers need to make

experiences meaningful and
impactful.
Image source: Beautycounter
32
Clean cosmetics brand Beautycounter opened a An in-store livestreaming studio is one way brands
brick-and-mortar store in late 2020 that doubles can rethink the role of the store while driving
as a commerce livestreaming content studio. engagement with products.
Image source: IKEA
33
IKEA redesigned a store in

Shanghai to incorporate a
communal space, a sustainable
restaurant and an area where
shoppers can repair items.
Physical stores can become a

place for communities to gather.
Image source: The Body Shop
34
The Body Shop launched a

Return, Recycle and Repeat
programme, where consumers
can recycle cosmetic and beauty
packages in store.
Retailers must consider their

sustainable practices due to
growing consumer awareness,
especially in Western Europe
and Latin America.
How commerce is likely to evolve over the

next 20 years
New Innovation
Rate of change
infrastructure moves beyond
increases
required imitation
Consumers
Data becomes
remain key
paramount
voice
36
Implications for retailers Implications for brands
Retailers compete on the customer Brands have more opportunities to go direct

experience, not product offerings. to consumers.
Technology will be table stakes in order to Brands will be able to engage with
create personalised experiences and drive consumers in new ways, potentially creating
efficiencies. new revenue streams.
37
Find new Generate real- Build smart

sources of truth time feedback supply chains
Six actions to take to prepare for the retail store evolution
Target a Know your inner Adopt a

segment of one circle laser-like focus
38
Q&A
Commerce 2040: The Future of the Store
in a Digital World
North America
Bob Hoyler, Consultant
NORTH AMERICA 40
Physical stores remain integral to the North

American retail landscape
GDP Per Capita by Region, 2020
$60,000
$50,000
$40,000
$30,000
$20,000
$10,000
$0
North America Australasia Western Europe Eastern Europe Latin America Asia Pacific Middle East and
Africa
Source: Euromonitor International
41
Convenience Seamlessness Experiential
44% 26% 47%

Digital consumers in North Retail sales in North America Digital consumers in North
America who cite immediate generated from non-store America who prefer to spend
purchase as a top reason to channels money on experiences rather
shop in store than products
NORTH AMERICA 42
Convenience: Instant gratification keeps consumers coming back to stores
Per Capita Retail Selling Space by Region, 2020 Percentage of Digital Consumers
2.50 Who Shop in Stores Due to
Convenient Location / Access, 2021
Retail selling space per capita, sq m
2.00 40%
1.50 35%
1.00 30%
0.50 25%
0.00 20%
North Australasia Europe Latin Asia Middle North Asia Latin Europe Middle
America America Pacific East America Pacific America East and
and Africa Africa
Source: Euromonitor International Source: Euromonitor International Voice of the Consumer:
Lifestyles Survey, fielded January to February 2021
43
Convenience goes hand-in-hand

with mobility
92%
North American households in possession of
a car in 2020
35%
North American digital consumers rarely or
never go shopping for leisure
Source: Euromonitor International Voice of the Consumer:
Lifestyles Survey, fielded January and February 2021
NORTH AMERICA 44
North Americans refuse to sacrifice value for convenience
Percentage of Digital Consumers Who Like North America’s Share of Global Retail Sales
to Find Bargains, 2021 by Select Format, 2020
60% 100%
55% 78%
80%
50% 60% 54%

46%
38%
45% 40%
40% 20%
35% 0%
Latin North Europe Middle Asia Pacific Hypermarkets Variety Mass Warehouse
America America East and Stores Merchandisers Clubs
Africa
Source: Euromonitor International Voice of the Consumer: Source: Euromonitor International
Lifestyles Survey, fielded January and February 2021
Image source: Target
45
In 2020, Target expanded “Drive

Up,” the retailer’s curbside pick-
up service, to more than 1,500
US outlets and expanded
curbside pick-up assortments.
This expansion helped lift the

company’s e-commerce sales by
144% year-on-year, driven by a
600% increase in curbside pick-
up sales.
Image source: Foxtrot Co 46
Foxtrot is an upscale convenience store focusing Foxtrot’s multi-channel focus helped sales more
on US urban centres. The retailer offers 60-minute than double in 2020, recording over 200% e-
local delivery and a five-minute fulfilment promise commerce sales growth and 55% in-store sales
on pick-up orders. growth.
NORTH AMERICA 47
Key takeaways for North America
Convenience and value Stores reinvented as

continue to drive innovation omnichannel hubs
More space within stores A seamless experience

support digital order fulfilment across channels is critical
Asia Pacific
Hianyang Chan, Senior Consultant
49
Asia Pacific dominates the global

retail landscape
40%
Share of global retail sales in 2020
39%
Share of global consumer expenditure by 2040
50
Seamlessness Convenience Shareable
50% 53% 58%

Industry professionals in the Digital consumers in the Digital consumers in the
region who use cloud region are willing to spend region agree that friends’
computing to provide a more money to save time social media posts are the
seamless omnichannel most influential factor when
experience have already seen selecting a product, brand or
an impact on their business service
ASIA PACIFIC 51
High population density and digitally savvy consumers
Digital Consumers’ Preferred In-Store Shopping Features, 2021

Asia Pacific World
45%
40%
35%
30%
25%
20%
Scan items while Select items and be Ability to access Use a cart or basket Virtual fitting rooms Ability to access
shopping and make able to immediately product information with sensors that which show you how additional
payment via mobile walk out of store with via QR codes automatically scans the product will fit information via in-
phone purchase executed products when added store kiosks
Source: Euromonitor International Voice of the Consumer: Digital Survey, fielded March 2021
ASIA PACIFIC 52
Mobile payment tools as the starting point

of a seamless consumer journey
Digital Consumers’ Preferred In-Store Shopping Features, 2021

Australia China India Indonesia Japan South Korea Thailand
Scan items while shopping and make

34% 47% 47% 45% 29% 31% 47%
payment via mobile phone
Select items and be able to immediately

33% 38% 48% 44% 25% 34% 41%
walk out of store with purchase executed
Ability to access product information via QR

27% 36% 44% 42% 34% 31% 42%
codes
Least selected Most selected

Source: Euromonitor International Voice of the Consumer: Digital Survey, fielded March 2021
ASIA PACIFIC 53
Traditional grocery retailing is most likely to

be disrupted
Share of Retail Sales by Format, 2020
World
Asia Pacific
and
Australasia
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Modern Grocery Retailers Traditional Grocery Retailers Non-Grocery Specialists Mixed Retailers
E-Commerce (Goods) Direct Selling Homeshopping Vending
Image source: geekculture.co
54
In 2020, Decathlon introduced

several retail technologies to
streamline the shopping
experience in Singapore.
Features include completing in-

store purchases via the
smartphone app, a foot scanner
and a robotic unit that roams the
store to scan for stock levels.
55
Traditional grocery stores in India, known as Incorporating digital technologies to enable mobile
kirana stores, are integrating digital wallets and payments and hyperlocal deliveries will strengthen
contactless payment systems. engagement with young digital natives.
ASIA PACIFIC 56
Key takeaways for Asia Pacific
Region is characterised by a Seamlessness is becoming the

diverse retail landscape new experience
Traditional grocery retailing is Blurring of online and offline

ripe for digital disruption commerce
Latin America
Paula Goñi, Senior Analyst
58
Retailing remains a highly

fragmented industry that strives
to modernise
49%
Share of traditional grocery retailers in 2020
57%
E-commerce growth in 2020, positioning Latin
America as the fastest-growing region
59
Sustainable Shareable Convenience

70% 70% 32%
Digital consumers in Digital consumers in Latin Digital consumers in Latin
Latin America feel they can America use social media sites America buy products in
make a difference in the like Facebook and Instagram store because of convenient
world through their actions multiple times a day location or access
LATIN AMERICA 60
Legislation forces companies to work

towards sustainable actions
Percentage of Digital Consumers Who Off-Set Carbon Emissions to Positively Impact the
Environment, 2021
Latin America
Asia Pacific
Middle East and Africa
Europe
North America
0% 5% 10% 15% 20% 25% 30%

Source: Euromonitor International Voice of the Consumer: Lifestyles Survey, fielded January to February 2021
LATIN AMERICA 61
Countries look to transition from linear to

circular economy
Percentage of Digital Consumers Who Use Sustainable Packaging* To

Positively Impact the Environment, 2021
(*Refillable, Recyclable, Biodegradable or Compostable)
Colombia
Brazil
Chile
Mexico
Peru
Argentina
0% 10% 20% 30% 40% 50% 60% 70%

LATIN AMERICA 62
Retailers look to increase and scale

sustainable solutions
Percentage of Digital Consumers Who Buy Products and Services from Purpose-Driven
Brands / Companies, 2021
30%
25%
20%
15%
10%
5%
0%
Asia Pacific Latin America Middle East and Africa Europe North America
63
Algramo seeks to revolutionise

the way Latin American
consumers access pantry and
home care products.
Established in 2020, Algramo’s

alliance with Walmart Chile
allows the circular economy to
reach modern grocers and
become scalable in the region.
Image source: Algramo

Image source: Grupo Éxito 64
Grupo Éxito launched Carulla FreshMarket 140 at 140 responds to sustainability demands, with
the end of 2020. This outlet stands as the first commitments to local buying and reducing the
carbon neutral supermarket for the company. impact on the environment.
LATIN AMERICA 65
Key takeaways for Latin America
Unmet demand for greener E-commerce is a key channel to

solutions tackle
Communicating value versus Legislations create milestones

reducing price for the long-term goal
66
Q&A
Commerce 2040: The Future of the Store
in a Digital World
Thank you
info@Euromonitor.com
@Euromonitor
Linkedin.com/company/euromonitor-international
Euromonitor.com

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Commerce 2040

The Future of the Store in a Digital World

This PowerPoint presentation includes proprietary information

For usage requests and permission, please contact info@Euromonitor.com.

The data included in this document is accurate according to Passport,

By 2040, physical stores will completely change. The shift

Barry Thomas Emily Xu Jason Goldberg

How retail has – and has not –

Profiting from the distribution of consumer goods hinges

What drives retailers to What drives consumers to

Cutting-edge technologies Heightened consumer demands

Preferred Delivery Features, 2021

Source: Euromonitor International Voice of the

10 competing forces reshaping the future of retail

Consumers vs Retailers vs Efficiency vs

Personalisation Choice vs Physical vs Consumerism

10 competing forces reshaping the future of retail

Consumers vs Retailers vs Efficiency vs

Personalisation Choice vs Physical vs Consumerism

Human versus bot

Digital Consumers: Comfort Level with New Technologies, 2021

Personalisation versus privacy

Choice versus curation

0% 10% 20% 30% 40% 50%

Value versus values

60% Buy from brands that support

Physical versus virtual

Direct Selling 30%

© Euromonitor International Source: Euromonitor International

Scenario: Digitally devised

Key themes that will shape the future store

Key themes that will shape the future store

Importance of these themes varies by region

Asia Eastern Latin North Middle East Western

How the retail store of

Convenience store Experiential centre

Technology plays a starring role in both Focus on testing functionality or brand

In the future, there will be two main types of physical

Check in before check out Contextualised shopping

Experiential ticket entry Community collabs

Street view of the convenience store

Aisle of the convenience store

Front-end of the convenience store

Street view of the experiential centre

Entrance of the experiential centre

An inside view of the experiential centre

An inside view of the experiential centre

Arc’teryx Equipment, a high-

Retailers need to make

IKEA redesigned a store in

Physical stores can become a

The Body Shop launched a

Retailers must consider their

How commerce is likely to evolve over the

Implications for retailers Implications for brands

Retailers compete on the customer Brands have more opportunities to go direct

Find new Generate real- Build smart

Six actions to take to prepare for the retail store evolution

Target a Know your inner Adopt a

Physical stores remain integral to the North

GDP Per Capita by Region, 2020

Convenience Seamlessness Experiential

44% 26% 47%