7 urgent omnichannel retail trends for 2023
Worldwide ecommerce sales have reached $8.1 trillion according to Statista and are predicted to account for 24% of all global retail sales by 2026. As online shopping has increased, several key omnichannel retail trends have emerged to accommodate new ways of reaching customers.
As retailers look to 2023, it’s critical to know how these themes influence the ways customers interact with your business. This post will explore the key trends that will impact online retailers in the coming year.
- Brick and mortar makes a comeback
- The omnichannel journey expands
- Social selling gets powerful
- Customers expect more of omnichannel retail
- Data is more important than ever
- Supply chain is still crucial
- Virtual shopping goes mainstream
What is omnichannel retail?
Omnichannel retailing is a commerce strategy that creates a seamless customer experience across multiple buying platforms. As consumers and buyers move between physical and digital spaces, they experience one consistent, organic conversation with the brand because every touch point is connected and their data is always unified.
Omnichannel retail stands in contrast to single channel or multichannel retail. Some businesses use a single platform, operating either a physical or online store. Others offer a multichannel experience, allowing customers to make purchases through multiple separate channels. But because these platforms are not connected to each other, they silo the customer experience.
In omnichannel retailing, businesses take multichannel experiences further by uniting every channel and creating a frictionless user experience. This connection keeps customers engaged and moving toward a sale.
Seven omnichannel retail trends for 2023 and beyond
Omnichannel strategies have been expanding in scope and popularity in recent years, and will keep growing for some time. As the number of available channels and devices continues to climb and the technology enabling omnichannel experiences continues to develop, consumer expectations grow with them. Brands and retailers need to keep up or risk becoming obsolete.
There are seven key omnichannel retail trends to focus on in 2023 and beyond.
1. Brick-and-mortar makes a comeback
Online shopping has become a dominant presence in retail, but this surge doesn’t mean brick-and-mortar is finished. According to the Annual Retail Trade Survey, online sales grew by $244.2 billion during 2020, but high online return rates and customer acquisition costs have encouraged businesses to shift strategies as they recognize the importance of in-person shopping.
There are a variety of ways to engage customers in-person, from storefronts to pop-ups or showrooms. And customers like in-store experiences, even if they’re only picking up online orders. A survey conducted by Delighted found that 75% of shoppers said being able to see and try-on items were the main reasons they shopped in-store.
Offering customers the chance to see a product in person can also help reduce returns. A study by the National Retail Foundation found that 20.8% of all products sold online in 2021 were returned, and in-person experiences that help customers make decisions can reduce that rate.
Brick-and-mortar stores also help businesses foster local relationships. Establishing a community with customers can create interest in your brand and increase customer retention. An Inuit study found that 70% of U.S. shoppers are intentionally supporting local businesses, even while shopping online. Storefronts and other in-person shopping opportunities allow you to take advantage of this interest.
2. The omnichannel journey expands
As fewer people engage with a single channel when making a purchase, the customer journey has evolved to an omnichannel experience. There are several ways that omnichannel retail is crossing digital and physical boundaries.
- Online purchase, in-store pick up. Customers often take advantage of buy online, pick up in-store (BOPIS) options, and some stores also offer curbside pickup for online orders. According to Barilliance, as many as 60% of abandoned carts result from customers encountering unexpected shipping costs, taxes, or fees. Offering customers the chance to pick up their items in person can encourage shoppers to complete their purchases.
- In-store purchase, home delivery. Customers are also buying items in-store and shipping them to their homes. This can be beneficial for items that are hard to transport, like large home appliances or furniture. Shoppers like the convenience of delivery, and brands can reduce inventory overhead since they don’t have to worry about stocking products.
- Online purchase, in-store return. Customers appreciate the option to return online purchases in-store. A Nosto study found that 61% of customers prefer to return online purchases at a retail location.
Companies are recognizing the importance of expanding their omnichannel experience by investing in both online and physical spaces. According to McKinsey & Company, the pandemic accelerated the digital transformation of customer interactions and the benefits that emerged proved so popular that many brands felt inclined to continue offering features like BOPIS.
As your business prepares for the future, you have a tremendous opportunity to engage customers in omnichannel experiences. McKinsey reported that 60 to 70% of customers said they now use omnichannel shopping options, so your customer journey should allow for seamless in-person and online interactions.
3. Social selling gets more powerful
A social media presence is essential for online retail, because it allows customers to engage with your brand, learn about products, and join a community with other consumers. And social media apps have grown into popular shopping channels as they’ve added the ability to make purchases within the app.
According to Statista, global sales within social apps will reach $1,298 billion by the end of 2023, making it an excellent place to engage your customers. As you build your social media presence, note that users respond to marketing that’s relatable, with diverse and genuine online personas. Work with social media influencers or user-generated content to appeal to your audience, who can then buy your products directly in their favorite app. Similar capabilities can be found in YouTube’s shoppable ad format.
Customers also use videos as shopping aids and more social media content is trending toward video. According to Think with Google, half of shoppers watch videos to help them decide what to buy, and 55% reported watching videos in-store to remind themselves what they wanted to purchase. Videos give customers a chance to see your products in action, and can make them more confident when making a purchase.
4. Customers expect more of omnichannel retail
Services that were once considered exceptional, like BOPIS, are now expected by customers. Shoppers have become accustomed to the benefits and experiences of omnichannel retail, so it’s critical for businesses to include them in their business models.
Customers also want more personalization. According to Epsilon, 80% of customers report they’re more likely to make a purchase when offered a personalized experience, like discounts related to recent browsing. Customers want to feel valued and not anonymous or interchangeable.
Customer experience standards are high, and consumers are less likely to stay with a company after a negative experience. One survey found that as many as 76% of customers would stop buying from a company after just one bad experience.
Omnichannel retail is the only way to keep these customers engaged. An Omnisend report demonstrated that businesses integrating three or more channels see a 494% higher order rate compared to a single channel campaign. Customers want to engage with you across multiple channels, and when you answer that need seamlessly they respond with better buy rates.
5. Data is more important than ever
Data is the cornerstone of any omnichannel strategy. Customer data monitors touchpoints and tracks return customers, giving you insight into their interests and motivations. The more data you have, the easier it is to create personalized experiences, encourage additional sales, and measure a customer’s lifetime value.
Customer data is also important for attribution modeling. Multichannel attribution is important with omnichannel strategies, but it can be challenging to track the impact of different channels on buying decisions. For example, if someone visits your online store, browses your products on social media, and then buys in-person, you need to determine the contribution of each touchpoint to the final sale. Customer data helps you understand their motivations and the influence of each channel.
It’s also important to note how the impending loss of cookies is shifting the focus to consent-based information. Building trust with your customers so they volunteer information is one of the best ways to collect data. Without it, you’d need to deduce a lot of insights for customer profiles through gated downloads, opened emails, page visits, and more. Rather than guessing about customer motivations, you can get firsthand information about what they want and what they value about your business.
6. The supply chain is still crucial
Your inventory should be sufficiently stocked and easily accessible by customers, whether it’s in-store or online. However, the pandemic caused severe supply chain disruption, and even though the congestion has begun to clear up, distribution still hasn’t reached pre-pandemic levels.
McKinsey found that in 2021, over 60% of customers found the item they wanted to purchase was out of stock and 71% either switched brands or retailers instead of waiting for a restock.
Pay attention to supply chains impacting your business. Maintain sufficient inventory and monitor sales data to decide what and how much to restock. And if you encounter supply chain issues, there are strategies you can use to help create a positive experience for customers.
- Maintain transparency. Features like an out-of-stock notification let customers know about issues, and allow them to sign up for alerts when products are available again.
- Keep communication open. Let buyers know about delays in shipping or obstacles you encounter.
- Be responsive. Answer customer questions and concerns quickly and use whatever means you have available to resolve their issues.
- Offer creative solutions. If their preferred item is not in stock, let customers know about alternatives you carry or check with inventory at brick-and-mortar locations to try and secure the item.
If inventory management is still a challenge, it might be time to consider a different strategy.
- Just-in-time (JIT) inventory management is a great option for retailers with little storage space, because it uses data to make sure you only have exactly what you need when you need it.
- Vendor-managed inventory is a popular strategy for brands offering a large variety of SKUs, because it puts the burden of inventory management on the vendor.
7. Virtual shopping goes mainstream
Virtual shopping combines the in-store experience with the benefits of buying online, allowing people to browse products from home while accessing expert recommendations and advice. For example, virtual shopping can allow customers to “try on” items by overlaying an image on a live video of themselves.
This type of selling has caught the attention of consumers. Think with Google reports that 90% of customers say they currently use or would use augmented reality (AR) while shopping. It even helps businesses with advertising, as those who incorporate virtual and augmented reality features into ads see a 94% higher conversion rate.
Businesses can use these tools to blur the lines between in-store and online purchasing. This can further engage customers because it doesn’t force customers to choose between the convenience of online shopping and the benefits of in-person buying. Customers can explore the look and feel of products before purchasing from the comfort of their homes.
In some cases, AR capabilities can offer additional benefits as well. Furniture and home decor brands are increasingly using AR on their apps and mobile sites to allow shoppers to “place” items in their homes. Even in-person shopping can’t show a customer how that couch looks in their own living room.
Stay ahead of current trends
It’s important to be aware of how changing technology shifts consumer demand. The comeback of brick-and-mortar business, the expansion of omnichannel customer journeys, and the power of social selling are key trends to focus on in the coming year.
If you’re ready to take the next step to capitalize on these trends, use an analytics tool to gather data from all of your channels to figure out how and where customers are interacting with your brand. You can then create personalized experiences tailored to specific customers and platforms.
Adobe Commerce can help manage your entire omnichannel strategy from a single view. With workflows powered by artificial intelligence and a scalable platform that incorporates new technology, Commerce can make it easy to grow your omnichannel business.