As shopper insights researchers, our work is focused on understanding consumer behavior in a retail environment. This can include studying what motivates people to make purchases, what factors influence their decisions (both consciously and unconsciously), and how the overall shopping experience can be improved. The goal of everything we do is to provide valuable insights to retailers and other businesses, helping them to better understand their customers and develop more effective marketing and sales strategies. You might think that work is static or repetitive, but the shopper experience is anything but static. From change in venue to change in access to product; the immediacy of third-party reviews and massive competition brought on by in-the-moment product comparison, the shopping landscape is one of constant change.
While almost nothing can be taken for granted anymore about the shopper experience, one thing that is clear is that disruption for brands both big and small is inevitable. It may show up from a challenger brand, be driven by social movements, be forced upon everyone in the form of a global pandemic, or exacerbated by more localized economics, the crisis of war or natural disasters – or a combination of many of these. No matter its origin, retail disruption appears to be here to stay.
Looking retrospectively at 2022, we share with you some of the story – a loose narrative if you will, of how brands faced these disruptions and a few thoughts on what may be to come in 2023. As the year ticked on, our team found ourselves wondering if retailers, manufacturers, and distributors could turn the challenges into opportunities. We saw some opportunities realized and some missed. As we close each year we like to share our perspective on some of these key disruptions and the trends that arose as a response to the unique shopper conditions of the year.
Here we explore four key disruptions and examine the related trends that emerged.
DISRUPTION: Shopping Goes Viral on Social Media
The hashtag, #tiktokmademebuyit is pervasive. Depending on the source, reported use goes anywhere from 3-12.5 billion views. Influencers and brands alike have engaged this singular thread on a wide range of TikTok videos with unboxing, product demos, and conversation reviews of new products. Omnichannel tools have also amplified this phenomenon. One simple example is the use of this TikTok hashtag having spread to YouTube. It really is the definition of virality.
EMERGING TREND: Increased Attention to Online Customer Journey
The social shopping business amounts to about $45 billion and users can expect to see more offers, a broader range of products being offered through social media and an increase in special collaborations between brands, retailers and influencers. And the world of social influence is not just for big celebrities anymore. As stated by Emma Ferrara, director of sales and business development at Viral Nation, “In a world where people are tired of advertising and celebrity endorsements, I think micro-influencers are really able to cut through the noise with the authenticity brands need.” Going forward, brands will need to focus on understanding the online customer journey for the social buyer and learn what triggers can be leveraged for better brand impact. Continued increases in the use of eye tracking and virtual shop-alongs will grow with this trend in 2023.
EMERGING TREND: Personal Shopping Goes Mainstream
Personal shoppers are often used by people who are short on time, have specific needs or preferences, or simply want the convenience of having someone else handle their shopping for them. Personal shoppers are commonly used by busy professionals and celebrities. In the past, personal shoppers were used by people who are looking for a high level of personalized service and expert advice when shopping. Now, with curbside pick-up becoming the norm in 2022, personal shoppers became a more easily understood relationship for many consumers.
As e-commerce went viral through social media, some in-store foot traffic was reduced. One way to tackle reduced foot traffic is for retailers to offer more personalized shopping experiences. In fact, 36% of consumers say that retailers should be offering this. Already being embraced by a number of big brands, this is a retail design trend that experts say will keep increasing in popularity. The development of new technologies we’re seeing in other areas of retail will prove invaluable in this space.
“This was a trend we were starting to see pre-COVID, and the pandemic has accelerated the process of adoption,” says Deb Gabor, CEO of Sol Marketing and author of Irrational Loyalty: Building a Brand That Thrives in Turbulent Times. “Local and small retailers are especially well suited to these kinds of personalized experiences and are leading the charge in the category.”
Brick-and-mortar locations began to see the benefit of providing personal shoppers as a way to bridge this gap between the highly self-directed and self-serve nature of the online experience and the kind of personal attention possible by providing shopping by proxy within the context of a relationship. Retailers are seeing the benefits of personal shoppers assisting with things like coordinating outfits, organizing wardrobes, or making recommendations for items to purchase. Some personal shoppers may also be responsible for purchasing items on behalf of their clients and may help with things like gift buying or special occasion shopping. This concierge-like service has always existed for higher-ticket items and brands, but the trend continues to see this feature offered outside of previously covered industries and price brackets. As shopping continues to grow through social media, this concierge service can provide an added benefit to the in-person shopping experience.
As brick-and-mortar stores see this as an opportunity, this same approach becoming mainstream online is not far behind. We already see big commitments from retailers to embrace a livestream shopping approach, along with virtual reality (VR) experiences to keep those loyal customers spending. This trend will become a major battleground in 2023 and should deliver more choice to the consumer and opportunity for innovative brands who get it right.
DISRUPTION: Supply Chain Shortages
We wrote about the Great Halloween Candy Shortage of 2022 recently, in light of Hershey’s announcement that they’d be unable to meet consumer demand for some of their favorite products this past spooky season. And Hershey wasn’t the only brand affected. Supply chain disruptions have abounded over the last 12 months and will most likely continue to plague brands into 2023.
EMERGING TREND: Minimalist Design
Minimalistic style in packaging design seeks to use as few design elements as possible, often utilizing clean lines and a limited color palette. This type of design often focuses on highlighting the product itself, rather than using flashy graphics or text to draw attention. Minimalist packaging design can be effective in creating a sense of sophistication and simplicity, and can help to make a product stand out on crowded store shelves. This minimalism in packaging design was strong in 2022, filling the shelves with fewer choices, but those more craftily simplified.
EMERGING TREND: Product Curation
The US market in particular has traditionally been overstocked and plagued by over-assortment for years. With supply chain shortages, another emerging trend was the amplification of the concept of a more limited availability. The offering of assortment curation, limited editions, fewer choices and more considered retail design can, if done well, translate into a positive experience for shoppers.
DISRUPTION: Continued Uptick in Online Commerce
Even in verticals previously thought of as immune to online shopping (think mattresses, major appliances and automobiles) challenger brands have emerged as scratching an itch for easy comparison shopping without getting out of your sweats, consumers still long for an in-store experience. However, at the end of 2021, Forbes projected that even with online e-commerce shopping accounting for over $1 trillion in spending, “the brick and mortar stores will still be very relevant for shopping with 84% of sales coming from physical stores.” For in-person shopping to remain relevant, brick and mortar had to rethink their in-person strategy.
EMERGING TREND: Specialty Locations vs. Flagship Stores
As e-commerce and convenience shopping continue to grow, brick-and-mortar stores will have to re-imagine their locations and how they can best serve their customer base. This is a trend we’re already seeing in 2022 and it is set to continue, regardless of supply chain issues. As consumers have become more savvy online shoppers, tempting them into physical stores and away from their smartphones requires some creative retail design. The trend we’ve seen emerging around flagship stores and specialty locations is evidence of this. Where a physical presence is justified all year round, flagship stores will remain. But where the ROI is diminished, specialty locations are beginning to emerge. The smaller-format stores serve a specific purpose and, unlike flagship stores, can meet more location-specific needs. Importantly for brands, this means maintaining a footprint in key neighborhoods, remaining front-of-mind for shoppers, and conserving and better-focusing resources.
EMERGING TREND: The Rebirth of the QR Code
The QR code was first invented in 1994 and was designed as a way to track vehicles during the manufacturing process. It experienced a surge of popularity about a decade ago. Few things have made such a significant comeback like the QR code. QR codes got a 2022 glow-up by being incorporated in more advertising, shelving displays, on products, and to highlight various in-store services, among other things. The technology is so universally understood that it has been employed as a quick and easy way to share information or link to additional content.
EMERGING TREND: Retailers Making Community Investments
There are many different ways brands can invest in their communities including:
- supporting local charities and nonprofit organizations
- sponsoring community events and initiatives,
- providing resources and support to schools and educational programs
- implementing environmentally-friendly business practices that benefit the community
- philanthropic giving efforts
- offering employees paid time off to volunteer in the community
Retailers focused on these efforts in 2022 with a trend in focusing on highly localizing their giving, adding the extra benefit of supporting the community in which their employees live. This trend will continue in 2022 especially as inflation threatens to reduce funding to community organizations. We’ll look for more companies creating more long-term partnerships over one-time giving drives.
DISRUPTION: Environmental Concerns
An increasing number of people are looking to reduce their impact on the environment through being more sustainable in their lifestyle, purchase behaviors, and more. Our research on sustainability as a driver in purchase intent gives brands insight about what consumers are looking for, what creates obstacles to purchase and what they are willing to pay as a premium for a more sustainable product.
EMERGING TREND: Brand Commitments to Sustainability
There are many ways that companies can commit to sustainability. Some examples include implementing environmentally-friendly business practices, reducing their carbon footprint, using renewable energy sources, reducing waste and promoting recycling, supporting sustainable agriculture and forestry, and promoting environmentally-conscious products and services. Companies can also commit to sustainability by educating their employees and stakeholders about sustainability issues and engaging with the community to address environmental concerns. Additionally, companies can make a commitment to sustainability by setting specific goals and targets for reducing their environmental impact, and regularly reporting on their progress towards achieving those goals.
While these initiatives gained strength throughout 2022 with 30% of consumers reporting they would not buy from companies that behave unethically or inappropriately when it comes to social or environmental impact issues. However, with inflation rising as the year comes to an end we may see these ideals abandoned as consumers feel the need (real or imagined) to “tighten the belt” and shop more frugally.
Are you as curious as we are about what 2023 holds for retail, retailers, shopping and shoppers? Whether our team is conducting surveys, focus groups, eye-tracking sessions, digital shop-alongs, VR shopping experiences or store intercepts, we’ll be looking at the small changes and keep on the lookout for larger trends affecting the market. As always, brands with better intel and more current feedback from shoppers themselves will find themselves armed with the data necessary to make informed decisions for better business impact.
