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Trends That Are Shaping The Retail Landscape in 2022

April 20, 2022

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Retail has been one of the most impacted sectors by the COVID-19 pandemic, alongside tourism and the events industry. 

Before 2020, retailers were already grappling with the decline of brick-and-mortar stores, and the pandemic added to their woes by forcing them to close stores, lay off employees, and see sharp drops in consumer spending. Despite the unexpected blow, we believe the retail industry will rebound with a renewed emphasis on experience design and human connection.

As we look forward to 2022, we must pay close attention to the following trends from the previous year, which will help shape a new normal in the retail industry:

E-commerce and digital channels are here to stay

E-commerce grew at a slower rate in 2021 than it did in 2020 when it hit a new high of 32.4%. This trend is unsurprising, given that stores gradually reopened after lockdown regulations were lifted, but it also demonstrates that pandemic habits aren’t going away.

Global e-commerce sales are expected to exceed $5 trillion this year, and many retailers are prepared to meet those demands. In addition to maintaining a local presence, independent retailers can connect with customers locally and expand their reach by selling online.

Going online can help any business succeed because many retailers are changing their business models to find new revenue streams. In fact, digital sales now account for 51% of revenue for retailers with an online presence.

Most brands are getting the omnichannel experience right

The Covid-19 pandemic has accelerated omnichannel retail, which is why it is one of the top trends in 2022. 

Retailers must ask themselves the following: 

  • Is it possible for a customer who finds a product they like on your website to continue their search in your physical store?
  • Can your retail staff provide clients with a digital product catalog if they don’t have one at the store? 

Retailers that answered “yes” to both questions above are prepared for an omnichannel experience that attracts new customers and retains existing ones.

Although online shopping experiences are in high demand among consumers, they still want the option to visit your retail store. According to a Forrester Consulting study, 59% of consumers expect to look at a product online and have the option to buy it in-store later. 

The same study shows that 54% of people are more likely to look at a product in a store and then buy it online, a practice known as “showrooming.” Customers, regardless of where they make their purchases, want physical stores to be an available option.

Going green

People are demanding more than just fair wages in the aftermath of the pandemic. Consumers are concerned about the long-term viability of their habits, including their purchases, more than ever before.

According to Forbes, in 2020, 32% of US consumers preferred businesses that were actively reducing their negative environmental impact. In 2022, a brand’s sustainability (reflected by its operations and products) will be a key differentiator in the market. Brands need to invest in environmentally friendly packaging, production, and fulfillment methods to set themselves apart.

Customers care more about convenience

Consumers’ expectations for how quickly they receive their online orders grew with the e-commerce boom, fueled by the pandemic. Amazon, the gold standard of shipping, was relied upon by many to deliver everything (from essential groceries to hobby supplies), and competitors are catching up.

In order to meet the demands of customers who have grown accustomed to making last-minute purchases, many retailers in 2022 are partnering with delivery platforms that provide same-day fulfillment.

To meet demand, Instacart has already partnered with retailers such as Staples, Best Buy, and others. Walmart recently launched its own in-house courier service and other major retailers are expected to follow suit.

The supply chain is still experiencing strain

Over the last 18-24 months, multiple factors have disrupted the supply chain for retailers: Issues such as chip shortages, out-of-date logistics systems, and staff shortages are delaying fulfillment operations.

Winners in retail will differentiate themselves by implementing next-generation integrated planning and analytics platforms with digital workflows, AI, and automation capabilities.

Final thoughts

The retail industry is constantly evolving. Equipping your customers and employees with better tools to make shopping more accessible is one of the best things you can do for them. To create a truly integrated consumer experience, brick-and-mortar companies must figure out how to make their offline and online channels work together. Similarly, digitally native brands must attempt to expand into physical retail in order to reach a larger audience. Customers will continue to prioritize the environment and sustainability while making shopping selections.