If you are a retailer, you know how challenging and exciting it is to keep up with the latest trends in the industry. Consumer behavior, technology, and market forces are the driving factors behind the constantly changing retail world. What works today may not work tomorrow, and what seems impossible today may become the norm tomorrow. That’s why you need to stay ahead of the curve and anticipate the future of retail.
In this article, we will reveal 5 retail trends for 2024. These trends will help you understand what your customers want, how they shop, and how you can meet their needs and expectations.
Imagine walking into a store, grabbing what you need, and walking out without having to scan your items, pay at a cashier, or even open an app. This is what Amazon Go offers, among others, using technology such as sensors, cameras, and AI to track what customers pick up and charge them automatically through their accounts, eliminating pain points and barriers.
According to a PwC report, more than 40% of consumers say they’ll pay more for a product if they can get it quickly and conveniently. It is about removing any obstacles that may stop the customer from making a purchase. Between the trending methods to pursue a frictionless customer experience, we can find self-checkout, autonomous checkout, contactless payments, real-time inventory updates, click and collect, in-store pickup, same-day delivery, endless aisle, and VR and AR experiences. The self-check-out market was valued at USD 3.84 billion in 2022 and is expected to grow at a CAGR of 13.3% from 2023 to 2032. Autonomous checkout, also called checkout-less, is another way retailers are attempting to provide a smoother experience. RBR predicts that by the end of 2027, there could be more than 12,000 stores operating around the world with checkout-free technology.
In addition, retailers are also expanding their payment options across online and in-store channels to cater to different customer preferences and needs. Proximity mobile payments, for example, have been gaining popularity among consumers in recent years. Around 125 million consumers are expected to use proximity mobile payment methods (payments with phones while in-store) by 2025.
Re-Commerce, short for reverse commerce, is not a new concept; it refers to the resale of second-hand goods. Based on the latest statistics, the global Re-Commerce Market is estimated to grow at a CAGR of around 19.22% during 2023-28. From 2018 to 2022, it has showcased substantial expansion, owing to the heightened awareness and prioritization of sustainability concerns among consumers, particularly those belonging to Generation Z and Millennials. Looking specifically at the European landscape, in 2021, the Re-Commerce market was valued at €75B. The market is expected to grow to €120B by 2025 (+60%). Over the next five years, the Re-Commerce market share will grow from 10% to 14%.
Several retailers, such as ThredUP and The RealReal, are capitalizing on this trend, offering consumers a platform to buy and sell used items. A significant example is that of Recurate. This is a platform that helps brands build their resale market; brands that are already working with it include Frye, Michael Kors, and Steve Madden. Recurate stated that in addition to being a fast-growing trend (11x faster than regular retail), re-commerce also allows for greater consumer engagement.
Major brands are embracing re-commerce for sustainability. IKEA's 2022 buy-back service lets customers exchange furniture for store credit, aligning with their 2030 goal for circularity and climate positivity. Apple's trade-in program allows customers to exchange old devices for credit, contributing to their commitment to reduce environmental impact. H&M partnered with Sellpy to expand re-commerce globally, enabling customers to buy or sell pre-loved items. These initiatives reflect a broader industry shift toward sustainability and circular practices.
Video shopping is a trend that combines e-commerce and entertainment, using live or recorded videos to display and sell products. Imagine this: you’re relaxing on your sofa, drinking tea, and you decide to tune into a live shopping show. The host presents various products, and even though you don’t really need them, you feel like buying them. This interactive method attracts consumers in real time, giving personalized suggestions and creating a unique shopping atmosphere.
The effect is significant — video shopping improves customer engagement, builds trust, and increases conversion rates. Forecasts for live e-commerce sales in the U.S. reach an impressive $55 billion by 2026. Platforms like Facebook, Instagram, YouTube, and TikTok lead this space. Nearly 58% of global internet users used Facebook for live-streaming shopping, followed by Instagram with 46% and TikTok with 16%.
Live commerce has proven to be a breakthrough in the East. For instance, as of June 2023, around 526 million people used live commerce in China, accounting for nearly 48.8 % of the total internet users. It is now gaining momentum in the U.S. and Europe. Gen Z and Millennial shoppers are driving this concept of shopping, with more than 50% of them willing to make purchases during live shopping events. In the fashion, beauty, and luxury goods sectors, McKinsey reports a 31% participation rate among Millennials. Tim Frank Andersen, CEO and Co-Founder of Liveshopper highlights the storytelling power of live shopping:
“It’s a captivating way to share brand stories, provide expert product insights, and engage in direct dialogue with customers. Clients see high engagement rates, with viewers actively participating — asking questions, commenting, and making purchases. The surprise for our clients lies in the valuable interaction they achieve with their customers through live shopping.”
Looking ahead, by 2026, live commerce sales could account for e-commerce, and by 2024, the livestream e-commerce market is expected to reach 35 billion.
Omnichannel is a strategy that integrates and optimizes the physical and digital touchpoints of a brand to create a consistent and seamless customer journey. According to statistics, companies with an omnichannel strategy retain 89% of their customers, compared to the 33% with a weak strategy. Besides, companies should invest in omnichannel strategies since they help generate around 80% of in-store visits. The pandemic indeed changed our shopping behaviors.
However, 74% of customers do online research before actually visiting a physical store, and 55% of consumers still enjoy going to physical stores to touch and see products. On the other hand, they may visit a physical store to see the product, but if they don’t find their size or want to compare prices, they may opt for online shopping or click-and-collect. The key factor is a consistent integration of offline and online sales channels, which makes the shopping experience smoother and easier.
Younger shoppers are particularly keen on new ways of shopping. McKinsey research shows that most Gen Z consumers don’t even consider traditional shopping boundaries. They evaluate brands and stores based on how seamless and fluid the shopping experience is. Companies need to meet these expectations to increase retail sales.
Besides omnichannel strategy, personalization of messages and interactions with customers is another key element. Those who aim for omnichannel personalization go beyond basic retargeting and customer segmentation. They create personalized experiences across multiple channels and do so consistently and at scale. Nike, for instance, has successfully executed its omnichannel strategy, adapting to the evolving retail landscape. They use different channels to reach customers, such as apps, partners, local stores, loyalty programs, pick-up hubs, and online-to-offline options.
This strategy aims to connect with customers at every touchpoint and help engage and retain them. Nike’s omnichannel shoppers are worth “at least twice” as much as online-only shoppers, says Daniel Heaf.
Using digital technologies in their stores can help retailers gain a competitive edge. By collecting and analyzing data from both online and offline sources, retailers can offer innovative services in-store that meet customer needs and preferences. For example, Uniqlo, has a click-and-collect service in several cities that allow customers to collect online orders at one of their stores with no shipping fee and no min. spend required. Sephora collects data through its virtual try-on service in some of its stores, which uses AR and facial recognition technology to allow customers to see how different products look on their faces without having to apply them physically.
Data-driven methods enable retailers to rethink their physical store environments and provide more personalized and engaging experiences for their customers. By integrating and analyzing data from various sources, retailers can optimize their operations and marketing strategies. A recent survey from McKinsey & Company found that companies that use data analytics are reporting 115% higher ROI and 93% higher profits. Data is the key to success for retailers in 2024 and beyond.
