Five Trends Shaping the Retail Experience in 2023
If you’ve been following the rest of this expansive article series on the state of ecommerce in 2023, you’ll already be well up to speed on the various challenges and opportunities being faced by the industry.
From the supply chain issues resulting from the COVID-19 crisis, the Russian invasion of Ukraine, and multiple other subsequent global events, to the shifts in customer behavior brought about by being forced to move in and out of lockdown restrictions, retail has found itself needing to be more flexible and agile than at any other point in living memory – except perhaps the global financial crisis of 2008.
However, now the dust has settled somewhat on COVID and we find ourselves with a whole new year stretching out before us – at time of writing – it would seem an opportune moment to take stock and look at five trends which we can expect to shape the retail business in 2023.
#1 Value
As inflation and rising prices continue to worsen the cost of living crisis for millions of people, customers are needing to do more with less. Many are still seeking luxury experiences but have far less money to spend on them than they had previously and a significant proportion of customers are finding themselves in truly desperate financial circumstances.
Pressure is on retailers therefore to find new ways of delivering value to their customers. If your retail brand deals in staples such as groceries and household goods then your mission is to make sure families can afford the essentials. However, those of you who deal in non-essential products have a much harder time ahead of you. You need to discover ways of helping customers enjoy a little luxury, without breaking the bank.
#2 Environmentalism
As customers become ever more conscientious when it comes to investigating the green credentials of the brands they choose to do business with, the onus is on retailers to make sure they are up to scratch when it comes to environmental responsibility.
Greenwashing – the practice of companies making false or exaggerated claims to fool customers into thinking their products or services benefit the environment – has been hitting the headlines recently as many brands have been exposed for the practice. Customer trust is at an all-time low as a result, so there exists ripe opportunity for sincere brands to score some easy wins right now.
Reducing your reliance on extraneous packaging is a fantastic and simple method of meeting these expectations. Many brands are replacing plastic packing with more easily recyclable alternatives such as glass and paper and, in many cases, seeking ways to do away with packing altogether.
#3 Artificial Intelligence
The arrival of ChatGPT and Google’s in-development alternative has restarted the conversation around artificial intelligence and its potential to disrupt the retail space. From inventory management to customer service, AI has many potential applications in the space.
"It is clear that artificial intelligence has the potential to cause major disruption in the retail industry this year,” says Deloitte. "Whether it is increasing productivity, reducing the time to launch new products, providing age verification at self-checkouts and click and collect sites, disrupting the creative process, or defining the skills required for future retail workers, AI will be something that retailers have to get to grips with sooner rather than later.”
Are the robots finally coming for your job? We’ll have to stick with this story as it develops to find out for sure.
#4 Twitter
Once the go-to social media network for businesses looking to connect with their audience, gauge public sentiment, and deliver customer service messaging, Twitter’s future as a safe place for brands has been called into serious questions following Elon Musk’s much publicized and disastrous takeover of the platform.
Mass resignations and firings, removal of key moderation capabilities, and the reinstating of several controversial figures’ accounts have caused many advertisers and companies to withdraw from the platform out of brand safety concerns. Then there’s the recent news that Musk has actually had employees reconfigure Twitter’s algorithm to promote his own posts over others which has many people asking if the network is now just his personal blog.
2023 will therefore likely be the year many brands seek to establish themselves on alternative social media platforms. Decentralized alternative, Mastodon for example saw its user base soar to 2.5 million users in early December 2022.
#5 Supply Chains
We often wonder how many people had even heard the term "supply chain” before 2020. However, the term has now become ubiquitous in households around the world due to the impact of subsequent geopolitical events.
Retailers in 2023 are going to need to adapt in order to survive and establish new relationships with suppliers and parts of the world less affected by these issues. A renewed focus on domestic sourcing should also be on the table for discussion.
Final Thoughts
There are five of the big trends we would bet on shaping the retail industry in 2023. As we move through the year we are sure new challenges and trends will emerge, so stay tuned for more on the developments in the retail industry as they emerge.
These trends and more are certain to be hot button issues at eTail Boston 2023, being held in August at the Sheraton Boston Hotel.
Download the agenda today for more information and insights.