GMDC|Retail Tomorrow, A.T. Kearney Identify Emotional & Experiential Connection as Top Consumer Drivers within Brick-and-Mortar Retail

It is undeniable that online retailers are capturing an ever-increasing share of many general merchandise (GM) categories. Still, brick-and-mortar retailers can remain competitive when evaluating their GM strategies on a category-by-category, platform-by-platform, and customer-segmentation basis in order to fine-tune their offerings.

This is one of the conclusions contained in the 2019 GMDC|Retail Tomorrow General Merchandise Benchmarking Study,an annual industry report recently released by leading retail industry trade association Global Market Development Center(GMDC)|Retail Tomorrowin partnership with A.T. Kearney. The study, which surveyed more than 100 GM retailers, was recently released at the GMDC|Retail Tomorrow2019 General Merchandise Conference.

The research indicates that GM sales within physical retailers continued to face challenges in 2018, with unit sales declining 3.9 percent while average prices increased 2.4 percent. Grocery retailers have slowed their decline in GM sales from the previous year, while drugstores remain the fastest-declining retailers.

Still, the report reveals key opportunities for physical retailers to leverage GM asselect categories did experience growth in 2018. The study found that of the 18 brick-and-mortar GM categories, 11 declined in sales in 2018, three fewer categories with declining sales than the previous year. Three categories — automotive, pet and hardware — increased sales over two consecutive years, while four categories — apparel, baby, toys and electrical appliances — actually reversed the downward trend.

“General merchandise isn’t dead, it’s changing,” said Jason Maehara, manager at A.T. Kearney. “Customers are going to different places to find GM and retailers are adapting their approach based on customer preferences.”

The research reveals pockets of growth that relate to several trends currently impacting GM. Overall, retailers are seeing a division in the way consumers purchase GM products based on the emotional and experiential relevance of the products. Based on this finding, the study divides GM sales into two categories, encouraging physical retailers to better understand their customers in order to cater to their needs:

“Chore” categories: The study finds that these categories — such as household products and office — are rapidly migrating to the online marketplace given that they are recurring purchases and customers have few emotional ties to the items. Instead consumers are driven by convenience and competitive cost. To better perform in these categories, the report suggests physical retailers reduce in-store assortment in order to replace the space with products geared toward each store’s distinct shoppers, provide customer-driven pricing and promotions, and reorient plans for display.

“Shop” categories: The report reveals that these categories — such as pet, baby and home — have seen less erosion. Within these categories, shoppers place great emphasis on brands, value the shopping experience and hold an emotional connection to the products. To leverage these growth opportunities the report suggests brick-and-mortar retailers generate additional space devoted to these categories, expand assortment and deliver “out of the box” experiences for customers, such as a pet play area.

While at the highest level it may appear that GM isn’t doing well in the food, drug and mass (FDM) channel due in large part to ever-increasing competition from digital merchants, research has found that pockets of growth exist and retailers can adopt some of these lessons to fuel sales across their GM business.

“At GMDC|Retail Tomorrow, we pride ourselves in giving retailers access to fact-based, consumer-focused insights that help them to make informed decisions, leading to sustainable and profitable growth,”said Patrick Spear, president and CEO of GMDC|Retail Tomorrow. “We help our members focus on the three building blocks of experiential retail: curated offering, emotional connection and engagement.”

For more on the 2019 GMDC|Retail Tomorrow General Merchandise Benchmarking Study, see this video of the live session that A.T. Kearney hosted at the recent GMDC|Retail Tomorrow General Merchandise Conference. For more details on the 2019 GM Conference, see Innovations Magazine. GMDC|Retail Tomorrow’s inaugural Selfcare Summit, the only industry gathering focused exclusively on the consumerization of healthcare, will launch on Oct. 3-7. For more information, please visit:

About GMDC|Retail Tomorrow
Global Market Development Center (GMDC)|Retail Tomorrow connects people and companies to opportunities for growth through events, networking and insights that inspire innovation. For 50 years, GMDC|Retail Tomorrow has been the leading nonprofit trade association fostering discovery, continuous learning and uncommon partnerships focused on enhancing the shopper experience. Today it represents more than 125,000 retail outlets. For more information, visit

About A.T. Kearney
A.T. Kearney is a leading global management consulting firm with offices in more than 40 countries. Since 1926, we have been trusted advisors to the world’s foremost organizations. A.T. Kearney is a partner-owned firm, committed to helping clients achieve immediate impact and growing advantage on their most mission-critical issues. For more information, visit