Retail Forecast 2023/24
Get insights on how retailers can navigate through 2022, gain popularity, and develop a relevant and unique position in the global market.
The return to a new normal
Throughout the last couple of years, retailers have faced issues with new Covid-19 variants, supply chain delays, labor shortages, and a volatile economy that has been set up against innovations in the virtual universe. In 2022, retailers must tackle ongoing issues headfirst, building bold strategies to ensure a future.
Since the pandemic started, retailers have become more consumer-centric than ever, as renewed faith in their physical stores as foot traffic rebounded in the second half of 2021. However, issues with logistics, shortages, and hyperinflation will continue into 2022.
So what can we anticipate for 2022? We are expecting that physical stores once again will regain their steam while demand for new immersive and personalized experiences will rise, and e-commerce and social commerce will continue to boom. A key point that retailers need to adjust to in 2022 will be prioritizing honest and transparent communications to build trust and foster future loyalty with consumers. A focus on omnichannel services will help retailers reach customers across channels.
In 2022, foot traffic will continue to rebound as shoppers feel more comfortable returning to stores. To continue to grow foot traffic, physical retailers need to consider a hybrid business concept to meet diverse and evolving consumer needs. The role of the store is increasingly diverse as it’s a blend of on-demand fulfillment, brand elevation, and experience, flagships serving as distribution centers, delivery options, and showstopping experiential spaces. Retailers will need to deliver meaningful and personalized store experiences to stand out. Incorporating physical and digital elements while experimenting with store models, locations, and different fulfillment options to test what works best for their customers is a must-have for retailers in 2023.
Continues logistical issues and the rise of omnichannel services in retail
Due to the pandemic, factories closed in Asia and surrounding countries, which led to long delays and shortages of supplies and workers. The return of the production caused pile-ups at ports worldwide, which led to a rise in raw material and sourcing costs.
Retailers have to reconsider their sourcing strategies and diversify them to minimize damage or a lack of products in case of further lockdowns. By diversifying the sourcing strategy, retailers aren’t hit as hard if lockdowns or shortages of materials occur. Diversified sourcing is also an asset for the consumer, as they are offered a higher variety of products, materials, and qualities.
Retailers will also need to hold back on sales and discounts to retain full-price stock for as long as possible. Product unavailability due to supply chain issues has hurt consumer loyalty and trust in 2022. To overcome this, companies can upgrade technology for logistics management, nearshoring, or connect with total solution supply chain partners. Think about moving order deadlines forward for suppliers and customers to avoid late deliveries. When moving deadlines forward, keep the major sales events, like Christmas, Black Friday, and Cyber Monday, in mind, as these will clog up the container and shipment situation if ordered too late.
The sales associates have never been more important for retailers than now. As brands convert their physical outposts into combinations of stores, logistical hubs, and warehouses, staff are expected to navigate between serving customers, fielding questions on social media, fulfilling online orders, and hosting personal shopping sessions. With footfall still not at the pre-pandemic levels, retailers can also use the flexibility of the omnichannel associates to enforce their online sales and support. Sales associates will be expected to be content creators and brand ambassadors and convert their relationships with clients into direct sales, whether that be in person or in-store situations.