As a professional in a cross-industry digital native consulting firm, I always keep my finger on the pulse of retail trends. Every year, I survey the trends in the industry to help my clients stay ahead of the curve. We as consumers are now in the driver’s seat and the retailers are now the Guuineapigs of our support. We now decide when and how we buy goods and services and the retailers must adapt or else risk losing our business.
The Rise of B Corps:
Sustainable B Corps, for example, is a Certified B Corporation that acts as a certification for coffee or USDA Organic verification for milk. B Corps are for-profit firms that have been certified by the non-profit B Lab to achieve high social and environmental standards of performance, accountability, and transparency.
They use the influence of business to advance the cause of goodness.
Sustainability in Retail:
Corporations have been using sustainability as a trend for decades, but now it’s not just the cost-effective choice – some consumers are concerned about our environment and want to support businesses that care.
This is leading companies in different industries like retail or food production toward certification by B Corps because their focus on improving society means lower prices without sacrificing ethics!
To get consumers excited about sustainable products, retailers need a clear commitment from their brand.
Commitment should also include information on what type of waste is generated in stores and how this affects the environment both locally as well as globally when materials are not recycled properly due to packaging or other methods used by companies during production that result in unnecessary wastes being sent off-site where they can have negative impacts such Plastic Ocean.
By outlining these efforts towards sustainability you will be able to differentiate yourself through quality customer service while conveying trustworthiness which leads back down
Dramatic Rise in Digital Shopping:
More than ever before, consumers are interested in shopping online. As a result, retailers have been trying to find ways to make their websites more convenient for customers who prefer online shopping. Because of this shift in consumer preferences, retailers have been addressing issues with online shopping such as shipping costs and delivery timeframes.
In the coming years, retailers will be focusing on services, user experience (UX) design, and sustainability, as well as key research and development (R&D) areas such as app development.
To stay competitive in the retail industry, companies will need to look at how they can use technology such as artificial intelligence (AI) to improve customer service.
The retail industry is expected to bring in over $30 trillion in sales with a compound annual growth rate (CAGR) of 3.4%, according to the Statista online statistics portal.
The growth will be due to an increase in online sales, improvements in supply chain management, and influence from millennials. Companies that adapt their business model will have an advantage over their competitors.
In 2023, we anticipate that retail trends will focus on services in the form of AI-driven buying advice and product recommendations. The trend is being driven by the rising expectations of consumers who are used to seamless experiences across all platforms and devices.
To meet those expectations, retailers will need to develop more streamlined UX design processes that build on current technologies while remaining cognizant of data privacy concerns among their customers and potential customers.
According to my research, sustainability is one of the most important factors for consumers in choosing where they spend their money.
Even though companies are already thinking about this trend, we predict that retailers will increase their efforts to become more sustainable over the next five years, while making sure that consumers remain informed about how brands are doing this and how they’re making an impact on the environment.
Retail will continue to undergo an unprecedented change in the coming 5 years as a result of several macro-level trends—including increasing demand for sustainable practices, UX design advances, and customer demand for services that make their lives easier.
The businesses that adapt to these trends will be well-positioned for success this year.
Retailers should focus on Digital Services, specifically AI-driven buying advice and product recommendations.
The trend is being driven by the rising expectations of consumers who are used to seamless experiences across all platforms and devices.
To meet those expectations, retailers will need to develop more streamlined UX design processes that build on current technologies while remaining cognizant of data privacy concerns among their customers and potential customers. More on this notion is below.
AI/ML, and Data
Predictive Analytics, AI, and ML are key for creating a personalized experience for each customer. You can tailor your communication with each customer based on their interests and behaviors by providing them with personalized offers and communications.
This can be especially useful in fighting showrooming. In addition to personalization through data, AI and ML enable retailers to automate large parts of the supply chain, resulting in significant cost savings.
To gain a competitive advantage, brands must know their customers better than ever before. With access to more information about how customers make decisions, companies can anticipate what their customers need and deliver it seamlessly.
A great example of this is Amazon’s Echo Show which enables users to browse products using voice commands or by using the touchscreen display.
By offering customers the ability to shop using these new channels, retailers increase their reach to new audiences while providing an enhanced shopping experience for existing ones.
Shoppers expect digital experiences. Overall, customers are demanding more digital shopping experiences. One-third of global online shoppers prefer to shop online rather than in stores.
As mobile devices continue to proliferate and become an increasingly preferred choice for browsing, researching, or buying products, retailers will need to remain relevant at each touchpoint along the path to purchase.
The digitally-native companies are still in an early stage of growth. For the past few years, there has been a lot of buzzes around digitally native brands that are moving their product lines to online-only distribution centers and disrupting traditional business models by creating relationships directly with customers.
These companies offer unique experiences that engage consumers on an emotional level through storytelling, curation, and personalization. While they are still in their early stages of growth, digital-native brands are already at the forefront of technology adoption—building online-first brands to reach the most prolific consumers through cognitive computing, big data analytics, machine learning, chatbots, and smart speakers.
However, these digitally-native brands are still in their early stages of growth and will face challenges scaling. They’ll need to balance their reliance on the most prolific consumers with providing a compelling experience for less engaged shoppers or risk becoming too niche—and thus less relevant to a broad audience.
As consumers’ expectations rise, so does the sophistication of retail design. Design is important since it has a big impact on product performance and evaluation. Companies are now placing a greater emphasis on design-led innovation as a source of growth.
UX design is key for retailers across the board because it’s what makes or breaks your website, app, etc. You need to make sure your UX design process focuses on three things: (1) making it accessible; (2) building trust; and (3) providing a personal experience.
The consumer is in control. Consumers’ expectations for design-led innovation are continuing to rise, so retailers need to keep up with this demand or risk losing ground to digital disruptors.
To remain competitive, retailers are looking to personalize their customers’ shopping experiences with in-store technology.
Technology in-store in the form of in-store digital screens can be used to provide shoppers with more personalized information, real-time promotions, and other types of content that might draw attention to particular products.
Consumers view in-store digital screens more positively than they do in-store video, which often comes across as an annoyance and may be ignored. UX design and sustainability are at the forefront of retail trends, retailers will have to be on their toes to keep up with consumer demand.
Numerous broad-reaching trends will reshape the retail and consumer goods landscape over the next 5 years. Sustainability – rooted in a future of greener materials and production methods, and the increased demand for transparency around product sourcing and supply chains – will be the catalyst behind many of the changes. Retailers will partner with brands to help consumers make better-informed purchasing decisions.
The challenge for retailers, apparel designers, and operations managers are to enable efficiencies that drive costs down while raising quality and brand loyalty.
It is clear that the pace of change and the accompanying radical shifts in business models will accelerate in the coming years. We will also see more and more examples of corporate responsibility, as businesses take steps to address their impacts. Examples of these positive developments can already be found today:
Puma invested in the circular shoe factory Full Cycle, Jack Wolfskin is planning a new concept store with solar roofs, Lufthansa Cargo has switched to electric trucks, online florist Lilium is creating greenhouses where sensitive plants are grown throughout all seasons, and Adidas is planning to develop products from recycled ocean waste. Ultimately, there are many opportunities for forward-looking companies who wish to rise to this challenge.
The future of retail is connected. The top brands will create experiences that are meaningful, mobile, and simple. Consumers will have the ability to connect and engage with the retailers that they love in new digital ways. The future of retail will be driven by a few key factors which include caring for the environment, AI, affordability, and digitalization.