By Mike Smollan
As per the Edge Global Insights Report 2023 – overall, this year’s retail industry has navigated the pandemic’s lingering effects, embraced digital transformation, addressed sustainability concerns, and tackled supply chain challenges. Coupled with the disentanglement of major market dynamics from the clutter, that is, supply chain disruptions, rising inflation, and the pros and cons of new tech, As well as making critical choices in the e-commerce space and pushing to deliver exceptional shopping journeys in the context of seamless omnichannel customer experiences.
Undeniably, the FMCG retail trade remains under enormous pressure, with many retailers and brand owners bracing for conditions to worsen in the near term, yet despite this, they continue to innovate, serve shoppers, and turn a profit. Adding to the mix – innovation, flexibility, and agility, the benchmark for competitive advantage.
Leading retailers and brands will have to have disciplined, measured, and innovative programs that allow for business strategies that sense, vet and experiment to reimagine and transform themselves, for example, by optimising investments with data-driven creativity through powerful mediums such as Netflix and Hulu (with a collective 480+ million subscribers) to get in front of a much larger consumer market. In crowded e-commerce spaces, where sales are projected to exceed $7 trillion by 2025, digital marketplaces must continually evolve, offering more opportunities to engage with customers (source, Insider Intelligence). In line with that, retailers and brand owners are plugging into physical retail experiences in which physical elements and tech coexist, bringing brands closer to their customers and making sure the in-store and online space make a seamless connection.
Disruptors going forward that will create space for winning solutions (sources, Edge Report & Edge by Ascential ‘Store of the Future’ 4th Edition) include the need for stores to transform even more to offer exceptional shopping experiences to customers. Digital integration and new technologies will shape the future retail environment, offering personalised experiences, optimised operations and innovation, and meeting evolving consumer demands across the shopping journey. Coupled with a deep understanding of the various markets, growth in the West and China is expected to slow in the medium term. In contrast, Latin America and other developing markets such as Nigeria and Indonesia are expected to be more resilient to the global economic slowdown.
At a high level, the following trend developments are on the radar as the retail industry transformation continues.
Digital Commerce
The integration of online and offline channels, increased mobile usage, AI and a growing emphasis on sustainability, digital commerce is expected to continue its rapid growth and evolution.
Social Commerce
An important e-commerce sub-channel, social commerce in 2024, will continue to blend the worlds of social media and e-commerce, offering seamless and personalised shopping experiences on their favourite social platforms.
Quick Commerce
Is expected to offer consumers even faster and more convenient delivery options, focusing on personalisation, sustainability and seamless integration of mobile apps and online platforms.
D2C
Models will continue to be leveraged to connect with consumers, with D2C expected to grow in popularity. Allowing companies to collect valuable customer data, enabling personalisation and a better understanding of target markets. As well as greater control over pricing and branding.
Third-Party Marketplace
One significant trend that may arise next year is the consolidation of third-party marketplaces, where larger marketplaces acquire smaller ones or form strategic partnerships to expand reach. This could lead to increased competition, resulting in improved services and features for both sellers and buyers.
Store & Warehouse of the Future
Both spaces will likely undergo significant transformations in 2024 as technology advances and consumer expectations change—from automation and robotics to personalised experiences, seamless omnichannel integration, sustainable practices and enhanced data collection and analytics.
–The writer is Chief Growth and Innovation Officer, Smollan.