As we approach the biggest retail season of the year, it is evident that the retail landscape is still evolving. E-commerce continues to take on a dominant role, but in-store shopping is also making a comeback. To help you navigate through the next year, we spoke to e-commerce visionary Michael Quoc, the founder of tech accelerator Demand.io and creator of SimplyCodes. Quoc shared his insights on the retail trends that will reshape how consumers shop and businesses operate online in 2024 and beyond.
1. Recommerce Revolutionizes Shopping Norms
In an effort to promote sustainability and reduce waste, there will be a surge in the popularity of recommerce this holiday season. Both businesses and shoppers are embracing the concept of buying used and secondhand, as well as reusing, reselling, and thrifting. This shift reflects a growing awareness of the environmental impact of consumerism. Big brands like Lululemon are already exploring initiatives like “Lululemon Like New,” which encourages customers to buy and sell pre-loved items, setting the stage for a more eco-conscious shopping future.
To leverage this trend, small retailers can take a cue from Lululemon and offer like-new, resold items for promotional discounts. This can be done through an online storefront, an in-store “resale clearance” rack, or other innovative ideas unique to their business and verticals. It’s important to be data-driven and gauge the demand for used items in your local area. By offering eco-friendly options, small retailers can attract consumers who prefer to shop with retailers that source services and materials ethically.
2. TikTok and Live Video Shopping Take Center Stage
The fusion of social media and e-commerce is set to reach new heights, primarily through platforms like TikTok. TikTok shopping will transform the social channel into the modern era’s home shopping channel and present exciting opportunities for e-commerce. What sets TikTok apart is its potential to encompass shipping and logistics, making it more comparable to Amazon’s business model than Meta’s. Live video shopping will become a powerhouse for product discovery, where retailers and influencers can engage audiences in real time, showcasing products and offering exclusive deals. This trend will revolutionize how consumers engage with businesses and make purchasing decisions. The interactive and entertaining shopping experiences offered through TikTok and live video shopping will draw in younger consumers, contributing to a surge in e-commerce sales during the holiday season.
3. A Paradigm Shift in Returns and In-Person Shopping
Returns pose a significant challenge for businesses, with 16.5% of U.S. purchases resulting in returns. To address this expensive problem and promote conscious buying habits, retailers may start implementing restocking fees. This evolution reflects a greater emphasis on minimizing waste in the retail sector. As a result of these changes, more consumers are expected to shift from online purchases to in-store shopping. According to a survey from PwC, 40% of global consumers already express their intention to increase in-person shopping due to high delivery costs. In response, big box stores will embrace a multichannel approach, encouraging customers to pick up their online orders in-store. This strategy drives foot traffic and enhances the overall shopping experience. Small retailers can also collect and analyze data around returns to identify areas of improvement. By addressing common issues like sizing through improved guides and practical product photography, small retailers can discourage excessive returns while maintaining an excellent customer experience.
4. Bespoke Goods and Local Shopping Flourish
Personalization is key in the evolving e-commerce landscape. Platforms like Etsy will shine as consumers seek personalized options and one-of-a-kind goods. Shopping locally and supporting small businesses will also gain momentum, fostering a sense of community. Consumers’ desire for unique, handcrafted products will redefine how businesses approach customization and cater to individual preferences.
5. Supply, Fulfillment, and Last-Minute Shopping Dynamics
The supply chain challenges witnessed during the pandemic have put a spotlight on retail supply and fulfillment efficiency. With the upcoming holiday shopping season, retailers will be put to the test. The competition between in-person shopping and last-minute e-commerce purchases will intensify as consumers seek convenient and timely solutions for their holiday needs. E-commerce players need to prioritize logistics optimization and invest in technologies like automation and AI-driven inventory management to streamline operations. AI and machine learning solutions can forecast demand, optimize production quantity, and catch anomalies, benefiting both large and small businesses.
6. Elevating Experiences via AI-Driven Customer Engagement
Seamless integration of AI-driven customer engagement tools will usher in a new era of dynamic interactions between businesses and consumers. These tools will enable instant responses to queries, personalized product recommendations, and real-time insights into promotions and discounts. By responding faster to changing needs, retailers can nurture loyalty and provide personalized assistance across every step of the customer journey. AI-driven customer engagement tools will also collect invaluable feedback and insights into consumer preferences and behaviors, empowering retailers to refine their products and enhance their services.
In conclusion, the retail landscape is continually evolving, and businesses must adapt to stay ahead. By embracing recommerce, leveraging social media platforms like TikTok, addressing returns and in-person shopping, focusing on personalization and local shopping, optimizing supply and fulfillment, and integrating AI-driven customer engagement tools, retailers can navigate the changing landscape and thrive in the next year and beyond.