With consumer retail habits and behaviors in a state of flux, brand and retail marketers can bet that some serious adaptation and agility will be necessary as we head into a “new normal” future. New research from digital business transformation firm Publicis Sapient highlights the key trends retail companies must focus on in the year ahead in order to transform their businesses into shopper-first organizations.
“As retailers adapt to changing customer behaviors and strive for transformational growth, it is critical for them to consider how they incorporate new customer needs and expectations into their current business models,” said Sudip Mazumder, Publicis Sapient’s retail industry lead in North America, in a news release. “In 2022, retailers must continue to reimagine their businesses for the new age of retail, from evolving as platforms and transforming their store experiences by integrating online and offline to monetizing data, investing in financial services products and optimizing return costs by focusing on a better customer experience.”
According to the firm’s inaugural 2022 Retail Guide to Next report, here are the Top 5 trends to embrace:
1. Evolve as platforms to create one-stop shopping for customers
Retailers today are expanding into community, content and a broader product selection. According to the research, the future winners of retail will be those that build a connected ecosystem of related services that customers can engage with through one seamless experience. Shoppers want to interact with retail brands that offer convenience. Retailers that create value-enhancing, differentiated ecosystems are able to provide a range of items specific to their category, which can become a convenient “one-stop shop” for consumers.
The research also found that nearly half of shoppers (49 percent) chose to buy from online marketplaces (Etsy, eBay, Alibaba, Shopee). Additionally, 39 percent of shoppers were more likely to buy from a marketplace that offered a wide selection of products. Instead of bouncing from website to website, shoppers can manage multiple needs in one place, as retailers become their go-to destination for both owned products and ancillary services.
Benefits of becoming a platform-based business:
2. Reimagine store experiences by integrating best of online and offline
Over the last 18 months, retailers have faced lockdowns and restrictions, resulting in a surge in e-commerce that has changed consumer expectations and the role of physical stores. While the shift to online shopping shows no signs of slowing, the research shows 52 percent of consumers in the US said they plan to make the majority of their department store purchases in stores this holiday season. In 15 years, stores will still be relevant and will be the best place for consumers to experience a brand.
In 2022, a seamless integration of online and offline will be critical to success. According to the research, 55 percent of consumers indicated they sometimes go to a physical store to check out an item before purchasing it online. Store experiences need to be digital and data-driven. By seamlessly integrating data across web, mobile, storefront and inventory channels, retailers can digitally expand their physical footprint while providing the connected, personalized experiences shoppers want.
3. Monetize data to increase brand engagement and sales
There are many ways a shopper can engage with a brand, and each avenue provides an opportunity to deliver personalized communications. According to the research, 37 percent of shoppers who buy online would like personalized offers based on spending preferences, while 31 percent want personalized content or advice to help them shop. Retailers must break down data silos within their organizations to gain a clearer view and better understanding of their customers’ preferences. Connected data from point-of-sale transactions, website traffic, email engagement and media impressions enable retailers to create targeted campaigns, personalized offers and customer-centric products and services, which ultimately can result in increased brand engagement and sales.
4. Transform as financial companies
Many retailers today are offering financial services or connecting customers with financial services providers as a natural extension of their retail function of buying and selling consumer goods. They’re creating a new ecosystem that serves a large demographic that they currently cater to in retailing. By leveraging technology and the vast data they have on their customers, retailers are unlocking a large customer base that is either under-banked or has no current banking relationships but still needs financial services like loans, advice or payments. From digital wallets to banking, customers will have their own personal CFO in their back pocket—a one-stop shop for all of their financial needs while still being connected into the retailers’ larger business suite.
5. Optimize returns by delivering better customer experiences
With a rise in online shopping comes an increase in returns. The research found that only 38 percent of shoppers are satisfied with the ability to try on and try out products online. Additionally, 46 percent of people said that when shopping online, they are more likely to buy from a brand that offers an easy way to manage returns. By truly knowing the customer, retailers can get ahead of returns. Data is key to improving customer experiences and operational efficiency. Retailers need data about their products and insights into how customers are buying and returning their products so that the data can be fed into the customer experience. Providing as much information as possible about products will help customers make better purchase decisions. In the case of apparel, retailers should use data to ensure that, from the start, a product fits the customer. Returns can be prevented with better customer experiences.
Download the full report here.
The data included above are based on shopper data collected through an online survey sent to 1,000 participants across France, Sweden, the US and UK. Publicis Sapient partnered with McGuire Research to complete the survey. Additional data points are also based on a global survey of 9,300 consumers from the US, Canada, Australia, UK, France, Germany, Sweden, Denmark, Hong Kong, Thailand, Singapore and the UAE.