Retail 2022 Predictions: Shifting Buying Behaviors, Supply Chain Nightmares
Over the past year, retail marketers have been forced to combat multiple industry curveballs to stay ahead of the competition while working towards keeping their once loyal consumers. From constantly shifting consumer buying behaviors, to the Delta — and now potentially Omicron — variant affecting e-commerce sales, to manufacturing and shipping delays.
Long story short: Retail marketers have dealt with it all. In fact, retail marketers that managed to think quick on their feet and pivot strategies, ultimately thrived this past year.
But… what will the road ahead look like as we wrap our hands clean with 2021 and enter 2022?
Will the same challenges linger into the new year or will retail marketers be faced with new industry-related problems? Let’s find out.
Out with the old, in with the... old again?
The various challenges retailers were facing this past year are going to be around a little bit longer. Yes, that means dealing with ongoing e-commerce sales fluctuations, the (final?) deprecation of third-party cookies, and lingering supply chain disruptions. Retailers need to revisit every obstacle that occurred during each quarter this year, analyze their solution and re-evaluate if said solution will continue to be the most viable — and successful — option.
E-commerce sales fluctuations are becoming the new constant.
After a strong first quarter, e-commerce sales growth flattened as vaccination rates grew and consumers began to shop in-store again. But have those numbers stayed consistent?
Consumers shocked retailers once again during this past Cyber five weekend. It was more of a red holiday, than a black one. The year-over-year decline was prominent across all categories, with only two exceptions: fashion apparel (+6.5%) and beauty (+4%).
In fact, 2021 marked the first time Cyber Monday sales did not exceed Black Friday sales in more than 10 years. In 2022, forecasting e-commerce growth will be extremely difficult. Marketers will find it challenging to create their marketing mix as product, price, place and promotion are all in flux: These 4 Ps are crucial to efficient e-commerce merchandising. 2022 will be the time to lean into the uncertainty.
The deprecation of third-party cookies will no longer be a looming trend on the horizon.
Moving along to the deprecation of third-party cookies — this industry curveball spooked everyone in the digital marketing realm when the decision was first made, but worries and concerns were quickly tabled when news broke of the delay.
In 2022, marketers need to prioritize building their first-party audience capabilities: Consumer analytics tools will determine who flourishes or flounders next year. Marketers should utilize tools that are able to derive valuable audience insights from first-party data.
There will remain a lack of understanding about the buying journey of digital natives.
As this holiday season has demonstrated, marketers are deficient in their understanding of the decision-making and buying journey of digital natives, Gen Z. As this generation's buying power increases, retailers need to focus on gaining a better understanding of Gen Z's digital engagement patterns to be able to engage them responsibly and effectively.
Retailers will need to invest in building an in-house experimentation and insights lab.
The pandemic has accelerated the speed of change, especially in the digital world, multi-fold. Businesses would be smart to invest in building an in-house insights lab that is able to continually conduct experiments to uncover relevant trends and validate hypotheses. It is my firm belief that embracing a culture of experimentation will become a critical success factor for every business.
Every retail marketer needs to either build insights and trend mapping capabilities in-house or collaborate with digital marketing partners who can help them do so. Why? Keeping a close tab on market and consumer trends will be extremely critical in the coming months. If retail marketers do not utilize this capability, it will be one of the biggest risks possible for businesses.
Although a lot of the new year’s obstacles will favor this past year, retail marketers should not be fearful. The pandemic taught us that change is not always a bad thing, and that sometimes you need to address the problems in front of you before you can move on to a next and new chapter. Retailers, now is the time to address the current, looming obstacles head-on — after all, if not now, when?
