In this guide, you'll learn about the trends likely to take the retail world by storm this year.
1. Rise of mobile commerce and friction-less payments
Mobile commerce, sometimes called m-commerce, is a fast-growing trend, with more retailers than ever building their online store around a mobile experience rather than on desktop.
Here's why you should jump on this trend fast:
More consumers than ever are using their mobile devices to shop
More consumers than ever are using their mobile devices to shop, with 73% of Australians having shopped online with their smartphone. In 2023, m-commerce accounted for $491 billion USD of all online sales in the US, a figure expected to almost double by 2027.
Provide convenience to your customers
Providing convenience to your customers is always a good thing. M-commerce lets customers shop anytime, anywhere from their mobiles – no need to visit a store or open their laptops.
Offer friction-free retail experiences
Friction-free retail experiences can help you turn browsers into customers. M-commerce can facilitate this with easy payment options like one-click checkout and credit card processing.
2. Omnichannel engagement for a personalised shopping experience
It isn't all about mobile, though – omnichannel engagement lets customers interact with you on whichever platform they choose. They might browse in-store and then buy online, ask for help on social media and email to make a return. Allowing for these touchpoints means customers get more personalised experiences, which can help grow loyalty.
Revival of in-store retail
There's an in-store retail revival happening because it allows shoppers to see, touch and try products before they buy. One report from ICSC Gen Z says 97% of their young respondents regularly visit brick-and-mortar shops.
Social commerce popular with younger consumers
Social commerce is when customers can research products and buy them all within a social platform. A recent Hubspot update suggests that this style of shopping is on the rise for both Gen Z and Millenials.
Communicating with customers at different touchpoints
Communicating with customers at different touchpoints helps you build strong relationships, delivering on their needs and preferences at different stages of the buying journey.
Keeping customers engaged throughout the purchasing journey
Keeping customers engaged throughout the purchasing journey is especially important if you've got a longer buying cycle. You can do this throughout the customer lifecycle with friendly check-ins, special offers, after-sales follow-ups and engaging content across your touchpoints.
Live website chat for personal customer support
Live chat is a great way to offer easy and personal customer support to answer questions about products they're considering or for after-sales help.
3. Use of fulfilment and micro-fulfilment centres for faster customer service
Fulfilment and micro-fulfilment centres (MFC) are trends to watch for 2024. Often highly automated, these centres are a smart way to improve operational efficiency. Micro-fulfilment centres are, for example, often small warehouses that are located in densely populated urban areas. They can help you provide faster, more efficient customer service, allowing you to:
Keep up with fast delivery expectations
Keeping up with fast delivery expectations is essential, especially if customers want expedited shipping.
Efficiently manage returns/refunds
Efficiently manage returns and refunds to save your time and energy while helping build customer confidence. If returns are easy, customers will feel more comfortable taking a risk on products from you again.
4. Focus on sustainability and ethical business practices
Sustainability is becoming more and more important to shoppers. A 2022 survey of Australian shoppers suggests that over 38% always consider sustainability when buying, and only 5% never do so. That means sustainability is sometimes a consideration for 95% of respondents.
An international survey of online shoppers backs up these findings: 47% of respondents say they prefer buying from sustainable brands. While real sustainability requires a business-wide approach, here are two ways to show off your eco-credentials:
Eco-friendly packaging to reduce waste
Eco-friendly packaging is especially important for online retailers. Look for packaging consumers can recycle or compost and clever ways to repurpose or reuse your manufacturing or office waste. You can even offset the carbon emissions from shipping or let the client opt to pay extra.
Ethical business practices to build trust and loyalty
Ethical business practices and environmental sustainability often go hand in hand, giving customers the impression that you can be trusted. Think about your business's impact on the world and create programmes to minimise it.
Let customers return empty containers, donate a portion of your profits to a charity or commit to paying your people a living wage (rather than a minimum wage). You should also work towards full transparency over any manufacturing processes and supply chain sustainability – what steps are you taking to ensure your products or materials aren't harmful to the environment or people?
5. Increased personalisation to improve customer retention
Personalisation will be even more important in 2024 – one study revealed that companies with excellent personalisation generate 40% more revenue than the average. That means for a bright business outlook, take the time to understand and deliver on the needs and preferences of each shopper at every touchpoint.
Personalised marketing to improve customer retention and loyalty
By improving customer retention and loyalty, personalisation makes shopping more relevant and meaningful. One study showed personalisation made 78% of shoppers more likely to buy from a retailer again.
Offer exclusive, personalised offers and promotions
Exclusive offers and promotions can be significantly improved with the use of personalisation. It means your freebies or discounts will be exactly what each customer wants and when they want it too.
6. Use of artificial intelligence and machine learning to optimise performance
Artificial intelligence and machine learning use are likely to become increasingly common in the retail market. Here are just some of the ways your business could use AI:
Improve business forecasting from data insights
Improved business forecasting is an ideal use of machine learning and artificial intelligence. It can analyse vast data sets to help you better predict what you should do next.
Improve efficiency of inventory management
Improved inventory management is just one of the ways AI and machine learning can help you optimise your business. Alongside demand forecasting, it can help reduce costs and improve the customer experience by helping you optimise your warehouse and stock levels.
Form hyper-personalised shopping experiences
Form hyper-personalised shopping experiences to create more authentic customer relationships and build long-term loyalty. AI and machine learning can help deliver curated recommendations, personalised marketing, landing pages and support, customised promotions and dynamic pricing and offers.
7. Use of augmented reality and virtual reality to showcase products
The use of augmented and virtual reality will be on the rise this year. Here's how we're likely to see this be used:
Use of virtual shopping experiences to influence buying decisions
Virtual shopping experiences can give online customers a way of approximating the in-store experience so they can make buying decisions faster and more confidently.
Use of augmented reality to test products in real world
Influence online buying decisions by implementing virtual simulations of products. With virtual reality, customers can interact with products in a 3D virtual space or use augmented reality to see how they could look in the real world.
Retail trends FAQs
Why is it important to keep on top of retail trends?
It's important to keep on top of retail trends because it will ensure you stay in step with your customer expectations and avoid falling behind your competitors. Even if you choose not to jump on every trend, keeping an eye on the retail industry will help you spot opportunities for growth and ways to optimise your operations and customer experiences.
What is the most significant retail trend currently?
The most significant retail trend currently is generative AI – according to one study, 81% of retail decision-makers feel they must urgently adopt generative AI in their business, and 72% feel ready to do so. Retailers can leverage generative AI for chatbots, personalised recommendations, product design and development, content creation, supply chain optimisation and much more
Keep business trending up
Whether or not you jump on any of these trends, it's critical to watch how the retail market is moving so you can make well-informed decisions about the future of your business.
AI and machine learning are set to take the industry by storm, improving everything from inventory management to hyper-personalised and virtual shopping experiences. Meanwhile, retailers are responding to a shift towards social and mobile commerce while looking inward at their ethical and sustainability credentials.
At the heart of all of these trends is one thing: data. It's the key to better understanding your customers' future needs and optimising your business.
MYOB Business' real-time reporting makes it easier. Get real-time access to your business and customer data and automatically generate smarter insights right when you need them. Get started today.
Disclaimer: Information provided in this article is of a general nature and does not consider your personal situation. It does not constitute legal, financial, or other professional advice and should not be relied upon as a statement of law, policy or advice. You should consider whether this information is appropriate to your needs and, if necessary, seek independent advice. This information is only accurate at the time of publication. Although every effort has been made to verify the accuracy of the information contained on this webpage, MYOB disclaims, to the extent permitted by law, all liability for the information contained on this webpage or any loss or damage suffered by any person directly or indirectly through relying on this information.