Retailers have been running around tirelessly trying to keep up with consumer demands and the drastic shifts in the economy. With the year coming to a close and the economic outlook for 2023 looking uncertain, retailers are growing concerned. Supply chain, inventory, and shipping challenges remain.
To help brands succeed in the new year, Wholesale Central has gathered tips and tricks from leading experts in the industry to create the ultimate 2023 Retail Success Guide.
- Omni-Channel Will Drive Revenue
- How Retailers Can Thrive in the Ecommerce Space
- Deals & Discounts Will Play a Large Role
- Beware of Increased Cyber Attacks
- Live Shopping on the Rise
- BOPIS Will Continue as a Popular Retail Strategy
Omni-Channel Will Drive Retail in 2023
Omni-channel approaches will be integral to online retail success next year. Because consumers currently have unlimited options when buying online, their expectations are at an all-time high. Retail brands will need to meet customers where they are. They also need to provide an experience that exceeds expectations to outperform the competition.
“Brands are re-imagining omnichannel experiences — moving from using multiple channels to seamless integrated experiences across channels. This also gives brands the opportunity to capture more data about the customer journey,” Anushka Lokesh, Head of Growth at Breinify, said.
Global online retail sales expected to continue to grow and reach more than $8 trillion in 2026. It is clear that ecommerce shopping will remain a major revenue source for retailers. An omni-channel strategy that leverages user-generated content and live video will be imperative for brands to gain a competitive edge.
Helen Herrick, Studio Director at MBH Architects’ New York City office, says these are the hybrid shopping design trends that retailers should focus on in 2023:
- Browse Online, Try On In-Store.
Some retailers have gone as far as allowing customers to browse a selection of goods online, reserve, and try on in store. This saves shoppers the hassle of combing through racks of merchandise.
- Online-Only to Physical.
Many brands that were once online-only are turning to brick-and-mortars to cater to Gen Z consumers who are interested in shopping physically. Online-only retailers should look into renting out a physical storefront in the new year.
- Augmented Reality.
Technology is not going anywhere, and Gen Alpha, Gen Z, and Millennials are all on board. These shoppers want to see a seamless experience that merges the ease and reliability of online shopping, but in the physical footprint.
“Online and offline retail has transformed with new technologies being developed at such rapid speed,” Latif Sim, CSO at BeLive Technology, said. “In the past, consumers would just view, feel, and purchase. Now, shoppers are looking for omnichannel commerce, social commerce, and interactive retail experiences.”
How Ecommerce Retailers Can Thrive in 2023
In order to capitalize on ecommerce growth, Sanjay Mehta, Head of Industry and Commerce at Lucidworks, shares some success tips for the new year:
1. Conversational Commerce
More ecommerce engagement and transactions should be facilitated through the likes of chatbots, AR/VR, and similar interactive tools. This will not only improve experiences through intelligent guidance, but it will also reduce the effort shoppers have to extend when finding and picking correct products.
2. Product Customization
While traditionally more prevalent in business-to-business commerce, more consumers are demanding product personalization. Sellers must follow suit to keep them from shopping from their competitors. Supporting technology adoption, such as 3D printing, can help customize merchandise.
3. Increase the Diversity of Applications for Product Discovery and Findability
Consumers are demanding and adopting new innovative ways to discover products beyond traditional text-based means. For example, through videos on TikTok, games, and streaming music. The rise of more ad-dependent free streaming tiers by the likes of Netflix and Spotify will accelerate this trend.
4. Move to Anonymous Personalization
Privacy regulations such as CCPA and GDPR are moving the focus of personalization away from using explicit consumer data to more predicted approaches such as neural- and vector-based data. These approaches leverage anonymous data points such as context and behavior to form hyper relevant experiences.
5. Utilize Relevant and Unique Content
Google’s algorithm updates are forcing sellers away from programmatic SEO tactics and making them invest more in curation. Shoppers want ecommerce sites to have greater enriched experiences beyond just product data to include the merchandise experience itself.
6. Commerce Everywhere, Particularly Media
Ecommerce further penetrates additional digital mediums and IOT. The move of media from analog print-to-digital, such as streaming, provides significant opportunities to expand the reach of products beyond both physical and digital shelves. In-app advertising and purchasing of products will dramatically increase in 2023.
Deals & Discounts Will Play a Large Role in 2023 Retail
Between budgeting and the need to stretch dollars, deals and discounts will play a larger role when consumers are ready to make a purchase. This is a trend where retailers need to buckle in for the long haul if they want to foster brand loyalty, according to Chip West, retail and consumer behavior expert at Vericast.
The reality is consumers will be focused more on “who can give me the best deal” and “what have you done for me lately.” Loyalty will be a low priority for shoppers as they focus on their personal finances. The retail industry will need to rely on this less for drawing in spend. Brands should continue to promote savings to grow and even attract new audiences. In some cases, messaging may be altered to not solely convey discounts, but also value.
However, if inflation declines, we will see supply chain and product availability stay on a positive trajectory. Consumers will spend more — even if it means using finance options such as buy now, pay later (BNPL) or a credit card. Shoppers are more willing to finance, including those reluctant before.
Beware of Increased Cyber Attacks in 2023
The COVID-19 pandemic ushered in an unprecedented era of online shopping, digital payments, and new cybercrime vectors. As the digital economy grows, damage from cyber attacks will amount to about $10.5 trillion annually by 2025. With the increased attack surface, retailers need to be particularly proactive with payment processing security.
Best Practices for Reducing Cyber Attacks
Chris Strand, Chief Risk and Compliance Officer at Cybersixgill, offers the following tips for retailers in order to protect their business and their customers:
- Uncover Gaps and Vulnerabilities that Attackers Can Exploit.
Regular gap assessment, backed by data, can help determine if a vulnerability in your system poses a critical risk to your business.
- Continuously Measure the Risk of Vulnerabilities.
New system and software vulnerabilities that may impact the security of data should be monitored, cataloged, and risk assessed. This can be achieved through vulnerability scans. When mixed with updated threat intelligence, retailers can identify and protect themselves from cyber attacks.
- Ensure the Right Priority is Applied to Vulnerabilities.
With a move towards continuous active monitoring, brands will be able to more easily identify evolving vulnerabilities.
Live Shopping on the Rise
With social platforms like TikTok, YouTube, and Pinterest, live shopping has been gained momentum in the U.S. and this is expected to continue worldwide. The livestream ecommerce market is predicted to reach $35 billion in 2024, a threefold increase from 2021. It is expected to make up 20% of all ecommerce sales by 2026.
What is Live Shopping?
In a nutshell, live stream shopping brings the age-old practice of home shopping into modern times. The concept remains the same — the channel is just different. Live shopping gives sellers the ability to showcase their products, and customers the ability to buy the merchandise in real-time. Overall, it is a highly engaging experience that goes way beyond simply clicking and filling up a shopping cart.
Cynthia Nelson, CSO at Revo Video, offers some insight into why she believes live shopping will continue to grow in 2023:
1. Media Companies Will Look to Shoppable Videos to Generate More Revenue
In 2022, streaming services used ads to offset growing subscription costs. In 2023, we will see media companies finding new revenue streams by incorporating live and shoppable videos into their content platforms. This means QVC-type shows and being able to buy what your favorite actor is wearing. Everything will become more interactive and shoppable.
2. Live Videos Will Make Social Fundraising Simple
The current fundraising experience is being told a story and then separately being asked to donate. In 2023, the world of fundraising — from schools, to politics, to NGOs — will shift. Live video will allow cause-based organizations to tell a story and request donations easier. It can be one seamless experience without being beholden to the governance of platforms like Facebook or Instagram.
Here are some of the key advantages that live shopping can bring to your business in 2023:
3. Better Engagement
Making your content stand out can be challenging, and video content definitely has higher engagement rates than most mediums. Customers are twice as likely to share video content with their friends than any other type. Live shopping also enables your followers to chat with you in real time.
4. Rapid Sales Increase
If done well, a live shopping event can expose your product and brand to many consumers in just minutes. When your viewers are enjoying what they see, they are more likely to invite others to join in.
In 2020, a celebrity jeweler was able to sell $120,000 worth of gold-colored vacuum sealers in five seconds while on the video shopping platform NTWRK. This is proof of the powers of live retailing.
5. Heightened Brand Awareness
You need to get in front of your target audience if you want to build brand awareness effectively. This is exactly what live shopping networks are good for. The audience will remember your brand if they get to know you via the interactive nature of live streams.
6. Prompt for Impulse Buying
Getting customers to purchase something out of impulse is good for business. In order to make this happen, you need to fully immerse them into a digital shopping experience.
Live shopping helps trigger this need. The audience will see other people on the live broadcast buying a product. The need to respond is intensified if said item is only on-discounted until the event ends. This tactic is sure to increase sales.
“The reason why I love live commerce is that it has the ability to mimic an in-store experience to some extent,” Sim said. “Imagine a consumer walking into a store and looking at a particular shoe on a model. If they have questions, a sales assistant is there to address them. During a live shopping show, the same exact scenario could be replicated, but now globally. In addition, during a live show, flash sales or time-sensitive discounts can be implemented to entice viewers to quickly purchase. In-store experiences cannot replicate.”
BOPIS Will Continue as a Popular Retail Strategy in 2023
Buy online, pick up in store was a big trend before COVID-19. Consumers had security concerns from boxes stolen off their front steps. During the pandemic, with everyone trying to stay safe and out of crowded stores, we saw this trend explode.
John Lunn, Founder and CEO of Gr4vy, says retailers should expect the BOPIS trend to continue to gain momentum in 2023. Rising fuel prices and increasing delivery costs, driving consumers to prefer making purchases in store. To help both retailers and shoppers spend less on shipping, be sure to offer BOPIS to offset the expenses.
No matter what predictions experts have for retail in 2023, we are still feeling the negative impacts from the pandemic and the economy is constantly changing. The best piece of advice we can leave retailers is to stay on their toes. Constantly conduct research on the latest trends, and most importantly: listen to your customers. They are the best way to find areas for improvement and success.