BRIC retail sales to reach US$15trn by 2022
China, India, Russia and Brazil are set to become four of the six largest retail markets in the world by 2022, according to research released by the Economist Intelligence Unit (EIU).
The EIU predicts that the Chinese retail market will be worth US$8.3trn by 2022, accounting for a quarter of the world's retail sales and twice the size of the US at $4.5trn.
India will account for almost $4trn of sales, followed by Japan with $1.6trn, Russia with $1.5trn and Brazil accounting for $1.2trn of sales.
While developing markets are set to grow, seismic shifts are also expected in consumers' shopping habits in developing markets.
E-commmerce, m-commerce and s-commerce (sales made through social media) are expected to transform global retail, with the EIU forecasting that online purchases will account for one-third of sales in markets like the UK in 2022, up from around 10% now.
Bricks-and-mortar stores will play a very different role in 2022, suggests EIU chief retail analyst Jon Copestake, saying that many stores will operate as little more than showrooms, collection centres or customer service hubs.
Luxury retailers, says Copestake, are ahead of the curve in this shift to a service and experience led model, "because people who shop in these shops, shop for the experience and these stores are very focused on creating that sales and service experience".
He adds the proliferation of counterfeit products is a barrier to increased online luxury sales growth. "People are more distrustful of buying luxury clothes online."
However, this is not the case for mid-market retailers, with growth for companies like Next and Inditex largely coming from their online, and multi-channel offers.
In terms of the clothing tiers set to see growth, Copestake expects polarisation to continue in developed markets, with growth to come at the budget and luxury ends of the sector.
He emphasises that one thing not being widely reported is the continuing growth of the luxury sector in Europe and North America. For example: "Coach saw its fastest growth recently, its North America growth exceeded growth in Asia, so I think that these top-end stores are still aspirational targets for people."
Copestake adds: "You might buy your socks at Primark or H&M, but you will still want to buy your top-end goods from luxury brands."
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