With any crisis, human behaviour tends to move down Maslow’s hierarchy of needs to the basics. Interestingly, COVID-19 has stifled the need for belongingness and consumers today are turning to technology to regain the lost sense of community and connectivity.
As a result of this altering phenomenon in consumer behaviour, marketiers today are more agile and attentive than ever. As we live through 2020 with “low or no touch” in a “remote” and “virtual” world, here are a few trends that will shape up the retail industry in 2021, based on consumer behaviour.
The change
Over the last 10 months, we have experienced some changes in shopping behaviour at breakneck speed. We have seen the unexpected happening, from infallible house-hold brands like GNC, Neimen Marcus, Brooks Brothers going bankrupt and shopping malls turning into ghost-towns, to the biggest surge in e-commerce transactions ever. The inevitable challenge for retailers now is to adapt to the changing behaviour of shoppers efficiently to capitalise on the emerging shopping habits and succeed in the ever competitive retail landscape. Customers are looking for personalised, engaging and seamless shopping experiences, with easy-to-use communication channels.
The upcoming trends
In the midst of the fast changing consumer habits and market volatility, retailers have to prepare themselves for the major shifts in the year to come.
- DTC – With supply chain choked during the lockdowns and traditional brick and mortar out of reach, brands and consumers resorted to direct transactions and DTC saw a global boost as the most promising retail strategy of 2020. Direct communication with consumers are also enabling brands to apply hyper personalisation and be of more interest to consumers.
- Retail Apocalypse – Economists have always referred to the downfall of retail stores from the inception of e-commerce. 2020 saw the highest drop in brick and mortar sales and most significant rise of online retail. The trend is here to make an impact in business strategy for most brands in 2021.
- Hyper personalisation – Access to consumer data is easier than ever today. With most transactions happening online, brands today have access to structured consumer data and these patterns are enabling retailers to structure hyper personalisation strategies to interest consumers.
- Social commerce – Before 2020, social commerce was a “good-to-have” asset for major brands. The pandemic resulted in the tectonic shift with brands resorting to social and messaging channels as the primary channel of consumer engagement and enabling social commerce for a seamless consumer experience.
- Mapping the customer journey compass – Adopting technologies such as conversational AI powered smart virtual assistants can point retailers to areas of opportunity to significantly improve customer experience. Delivering a customer experience that translates to a customer’s needs is the key to building a competitive advantage in the current environment.
- Essential consumerism – Consumers are “tight-pursed” today and preparing for a foreseeable recession. Retailers and brands should prioritise planning their inventory with essentials and long sustainable non-essentials to cover for the period.
- People First – Experience starts with interactions. Enabling employees with adequate training and closing the skill gaps could empower retailers with customer facing staffs having higher accountability and better connection with the consumers. There are AI/ML powered automation platforms that use conversational AI to support rich interaction with employees, analyse their needs and upskill them. Digitising the essential training for employees on easy to adapt social messaging or proprietary digital channels is a key winning strategy for retailers in the coming months.
- Changing store fronts – Consumers today are looking for low to no contact transactions. Beside e-commerce the trending behaviour in retail engagement also requires easy pick-up locations available locally to the customers where they can pick-up the products which get ordered seamlessly through any channel of their choice. A significant amount of customers have embraced the curbside pickup practice and the trend is at an all time high.
- Omnichannel attribution – Customers are engaging with brands today through multiple-channels and attributing to all customer touch-points and analyzing the customer behaviour will result in more holistic and best-in-class omnichannel strategy for retailers of today. Today smart bots and virtual assistants can be seamlessly integrated across platforms like social media, website, Google Business Messages, WhatsApp for Business and Alexa
- Enabling social distancing and digital embracing – Social distancing doesn’t necessarily need to be logistical distancing. While retailers are choosing more digital first channels, empowering customers to order straight from their warehouse direct to their home using easy adopted digital channels is the winning strategy.
- Shoppable anywhere – Be it a video, a social post, a personalised notification – retailers need to enable customers to transact across all mediums across any device.
- Rise of private labels – Ever since the pandemic, the rise of private labels on online channels are at an all time high. Owning a digital first store is the easiest than ever today and brands who were left behind in the expensive brick and mortar battle are surfacing more easily, giving consumers the ease of access.
The Consumers today are seeking focus on value, authenticity, social awareness amidst the market uncertainty. Retailers and brands need to communicate a sense of purpose, evoke nostalgia and be proactive about the current challenges in order to generate greater loyalty and minimize the impact of the pandemic on business. Automation is no longer a choice, but an integral part of the retail landscape. Deploying innovative solutions like conversational AI that enable personalisation and highly customised customer experience can have a significant impact for retail enterprises.
The trends emerging from this pandemic has a deepened impact on consumer behavior and much of these changes will be permanent. Ensuring an agile and dynamic approach with product ranges, best-in class services, messaging and marketing plans, in tune with these changes will script the future for the brands in the coming year.
View Comments
Pretty nice post. I juѕt stumbled upon your Ьlog and
wisheⅾ tо ѕay that I've really enjoyed
browsing youг blog posts. After all I will be subscribing to үour feed and I hope
you wrіte again very soon!