The changes to retail and E-commerce will continue as we enter into 2022. This is what our team of experts believe the biggest changes will be in the upcoming year.
1. Digital grows even more
Mobile and app-based purchases will continue to grow. Some experts predict digital commerce may account for even more than 50% of sales. This is due to investments in fulfillment partnerships with delivery platforms like Instacart. Smaller retailers will continue to focus on their digital business in order to compete with bigger rivals. Payment options like ApplePay, Amazon Pay, and Paypal will see growth as these easier payment methods help reduce cart abandonment. Data shows that express checkout can increase the rate of checkout to order multiple times over.
Livestream influencers or stream-influencers will become more popular as they have in China where some of these influencers can move billions’ worth of inventory in a single day. This will lead to growth in the U.S. of Livestream sales events. The Amazon Live platform allows customers to follow the brands they like and be notified about Livestream events. Walmart is already hosting events on TikTok and Twitter. Gartner research shows that 60% of millennial and Gen Z consumers will prefer making purchases on social platforms by 2026.
3. Omnichannel, Omnichannel
Retailers like Walmart will continue with innovations to tie their physical stores and their digital footprint together in efforts to take away from Amazon. Target also will also continue to improve on their click and collect platform that is already very well-established. Consumers are toggling and blending online and in-person shopping well beyond the realm of shopping. In 2021, 51% of U.S. consumers say they’ve enjoyed the new conveniences that going online has to offer in various areas of their lives including banking, travel, and insurance.
4. First-party data is paramount
Big retailers will continue to try use the first-party data about their customers to monetize digitally. When done correctly, this data can build strong connections with consumers, maximize media impact, and minimize overall inefficiencies. Whoever wins the race to combine first-party data from the brand and retailer sides in a seamless way will win.
5. DTC sites and third-party sellers merging
As of 2020, Amazon had more than 1 million third-party sellers. Venture Capital companies are raising a lot of money to start to consolidate these third-party sellers on Amazon. We’ll continue to see this trend in 2022 of consolidation as a way to simplify the overall shopping experience for consumers. People gravitate towards marketplaces that carry a wide array of products but also offer easy payment, shipping, and return options. The move to apps will only accelerate this trend.
6. Prioritizing the supply chain
Supply chain bottlenecks will continue into 2022. The logjam in the supply chain at the start of the pandemic coupled with the inventory shortages over the holidays have highlighted the importance of a robust supply chain and logistics network. Investments in supply chain technology and logistics will continue to grow.
7. Social consciousness
Social conscious DTC brands like Rothy’s and Toms will continue to do well as younger consumers focus on brand values. Some fashion retailers like H&M have started accepting clothing for recycling. There’s also been growth in resale platforms like Poshmark and Rent the Runway. Brands are more openly supporting causes that will gain support from these younger cohorts.
8. Saving is becoming popular
The pandemic caused people to save more, and this habit may now be ingrained. Many are prioritizing debt reduction and nest-egg building over the acquisition of goods. This has huge implications for retailers. As the allure of saving grows, retailers will have to fight harder for every sale, both against their competitors and the new inclination not to purchase at all. The value proposition for the customer will become paramount and retailers will need to concentrate on delivering a great experience.
In summary, changes to retail and E-commerce in 2022 will focus on customer ease. As the fight for consumer dollars continues to intensify, it’s critical that retailers get closer to the customer to understand their entire journey and not just parts of it. Early adoption of emerging technologies will help win the battle.