The newest digital trends in the retail industry
Insights into the importance of digital agility, technology, and personalisation amid disruption
It’s that time of the year again when Adobe releases its annual Digital Trends report to highlight emerging trends in the digital space. Every year, we partner with Econsultancy to survey marketers from a broad cross-section of industries – and this year’s sample included 507 retailers. We use the results to analyse recent developments and look toward the future. In this post, we’ll focus specifically on the findings and trends that are directly relevant to the retail industry.
The findings from this year’s report demonstrate how meeting evolving customer needs and personalisation at scale are more important than ever. The report also confronts volatility in the industry, shows how retailers are dealing with disruption and illustrates the value of agile IT and your underlying tech investments.
Retail gets even more personal
Personalisation in retail has been around for a long time. Still, it persists in being one of the most prevalent marketing buzzwords this year. While not a new concept, the time has come for retailers to close the personalisation gap between customers’ expectations and the retailer's ability to deliver. At the same time, customer loyalty is under strain and up for grabs. Here are some things to consider as we move farther into 2022:
- Expectations have changed forever. First off, it’s important to note that the acceleration to digital that began at the start of the pandemic is here to stay. Customers now expect retailers to have mastered the digital experience, and that means anticipating what customers want next.
- Customers want to be recognised in all your channels. What this means is that customers want seamless, interconnected experiences both in store and online. This will require retailers to work even harder to understand engagement across all channels.
- It’s getting harder to stand out. The marketplace has become increasingly competitive and complex, and customer loyalty can change quickly. Today’s consumers have a lot of choices, which means that staying relevant will require increased effort. While all retailers are attuned to the fact that experience is important, now it’s time to differentiate the experiences you offer. Explore new ways to make in-store shopping better with digital — and vice versa.
- Customers expect consistency and honesty. Customers are aware that retailers face a wide spectrum of challenges, especially now. They don’t expect perfection. Instead, customers want you to set realistic expectations and tell them promptly if you can’t meet those expectations. In short, people are looking for retailers to be both responsive and transparent.
— Avery Worthing-Jones, Senior Vice President of Product Management, Gap Inc.
Disruption has become routine
Retailers must continually navigate uncertainty and issues beyond their control. But what’s most important is how your business responds to the unknown.
- Business volatility will be a feature of 2022. Despite challenges like supply chain logistics and rising inflation, your ability to hone your focus on the customer and deliver seamless omnichannel experiences will be critical throughout 2022 and beyond.
- The stakes are higher than ever. Online spending continues to surge — the 2021 online retail holiday season topped $200 billion for the first time, up 44% from 2019 — and these numbers are expected to be even higher throughout 2022. Now is the time to dial up agility so that you can adapt to new circumstances and new opportunities at speed, even with disruptions.
- Mobile technology will play a bigger role in the in-store experience. As retailers face a shortage in human resources, mobile comes into its own as a tool for deeper brand engagement. In fact, 37% of practitioners in our survey cited mobile applications for in-store shopping as their highest investment priority for 2022.
- The loss of data from tracking cookies will drive consent-based marketing. With the impending removal of third-party cookies, the pressure is on to find new ways to access and unify customer journey information. Retailers that succeed will wean themselves off data from third-party cookies and rely on customer data they have explicit consent to use.
Integrating platforms and unifying data will yield big dividends
Your ability to adapt to circumstances and take advantage of opportunities that present themselves will be determined, in part, by the technology you have at your foundation. Make sure that IT decision-makers are part of strategic conversations — and that they understand the subtleties of the retail business.
- Channels and experiences must be connected. Retailers today can’t afford to operate in silos. All your essential platforms like commerce, point of sale, warehouse management, order management, and so on must work seamlessly together.
- Artificial intelligence (AI) goes mainstream to unify customer data and improve the experience. More sophisticated AI solutions are making it easier and less costly for retailers to connect data points that help personalise experiences. But upskilling is crucial if retailers are to use AI and machine learning (ML). Additionally, automation will also allow employees to offload manual tasks in favour of higher value operations that solve customer pain points and create novel experiences.
- Focus on your data strategy. While retailers have made strides in this area, there’s still room for improvement. Only 25% of those surveyed feel they are “highly effective” at data gathering and protection.
— VP of marketing at one European-based retailer
Map your own path to success
Success is a moving target, especially in retail. And “keeping up” is not enough. Retailers must be on the lookout for the next trend and innovation. That doesn’t mean chasing each new fad. Rather, you want to be open to new behaviours — and be ready to adapt.
— VP of digital for a US-based-general merchandise retailer
The digital experience you design needs to reflect the understanding that customers don’t think in terms of separate channels or stages like mobile versus in store. Everything is interconnected, and personalising the customer journey has never been more important. You need to consider the customer holistically and adapt your processes to fit their individual needs instead of trying to mould their needs to fit your processes. Remember that your employees are a valuable asset and you can use mobile technology and automation to support their efforts. And finally, embrace intelligent technology — AI and ML — to refine insight gathering and streamline workflows to help you deliver the best possible customer experience in 2022 and beyond.
For more insights, read the full report, 2022 Digital Trends – Retail in Focus.