Marketing in the new age of retail: What to expect in 2023

 

Retail sales posted their biggest gain in eight months before plummeting as the holiday season began in November. Consumer demand followed a similar trend as a rapid succession of influential events including inflation, global recession and supply chain problems.

Despite these challenges impacting retailer margins, consumer spending, and US retail growth, it could slow to 2.9% y/y in 2023, although retail Stable for the last two years. Yet changing consumer spending habits and behaviors, coupled with macroeconomic conditions, are forcing marketers to innovate when dealing with complexity.

Here’s what you can expect next year.

CHANGING CONSUMER BUYING HABITS:

As e-commerce sales steadily increase, shoppers are losing the benefits of face-to-face shopping, such as fitting rooms, and turning to ‘cling-on’ or ‘cling-on’ means. . Buying items in multiple sizes and returning the wrong size. As a result, retailers are grappling with a surge in returns, and returned products may not return to shelves and instead end up in landfills. This hurts retailers’ bottom line and causes billions of pounds of returned inventory to pile up. landfill per year.

Returns are part of the shopping experience, but retailers can avoid economic and environmental impact by listening to their customers’ expectations and needs. Educating shoppers about product choices with ratings, reviews, and user-generated content helps shoppers make the right product choice the first time, curbing the rising trend of returns and improving customer satisfaction can be increased.

Increased Multiple Touchpoints:

The pandemic has not only changed where consumers shop, it has also accelerated online shopping and pushed consumers into the digital realm.

Shopping in 2023 will require more brand intent as consumers switch between scrolling apps, comparing prices and reading reviews on their computers.

New consumer shopping journeys require new marketing approaches as they include multiple touchpoints and channels, including in-store and online shopping, as well as social commerce, proprietary apps, and online communications. In particular, the mobile channel has increased its share of the total U.S. Online sales to reach 41.8% of e-commerce retail sales by 2022.

As omnichannel commerce grows, marketers and retailers alike need to focus their omnichannel marketing efforts to reach their target audience.

The purpose of omnichannel marketing is to tell a cohesive brand his story, support each other and build loyalty at all customer touchpoints across all available channels (online and offline). For example, a customer can view products on the retailer’s app and receive reminders her email highlighting the item, the nearest store, and booking options.

These details make it even faster and more convenient for customers to receive their products, and personalized communications make the experience smoother. In the new year, retailers will need to adapt their omnichannel marketing strategies to cater to where and how consumers shop, creating a seamless experience.

Evolving Loyalty Programs:

During the multi-touchpoint buying process, many consumers use digital devices to compare product prices and read reviews to find the best deals. As shoppers focus on cutting costs without sacrificing quality, retailers find it difficult to maintain customer loyalty in a sea of ​​low prices. Traditional reward programs — buy equal points — are of low value and do not detract from value to consumers. Loyalty is more than just perks and points. It’s about creating unique, positive customer interactions at every point in the customer’s journey.

Loyalty programs like IKEA and Target let you convert points into dollars to save on purchases, but in 2023, retailers will offer personalized, relevant rewards, such as cash back and discounted membership prices. will switch to programs that offer higher, more tangible value to customers.

Even Starbucks and Delta have integrated two loyalty programs, allowing a customer to earn one mile for every dollar he spends at Starbucks, and double the miles for Starbucks purchases he makes while traveling. can be obtained. Competition in retail is fierce, but these loyalty programs can differentiate one retailer from the next, encouraging customers to shop more, engage more often, and build loyalty. encourage you to do so.

Personalization with Customer Data Platforms:

Personalization will become even more important in 2023 as retailers have embarked on a digital transformation in the last two years. Each stage of the customer journey, from awareness to purchase, requires some degree of personalization to attract and capture the customer’s attention. According to McKinsey, 71% of his consumers expect companies to offer personalized interactions, and 76% are frustrated when they don’t, driving them to competitors.

Leveraging customer behavior and zero and first party data to create personalized content plays a key role in engaging customers along this journey, but it is easier said than done. Customer buying behavior is rarely linear. It often involves multiple devices and is constantly changing, but it’s an essential part of retail marketing.

Customer data platforms (CDPs) can be used to manage data and create a scalable, comprehensive view of customers across channels based on the marketer’s needs. Customer data can also open an avenue of profit for retailers through retail media networks (RMNs) — a retail-owned digital platform that gives marketers access to customers’ first-party data, like purchases, which they can use to build personalized ads on the retailer’s website.

We’ll see a jump in retailers using CDPs to create a holistic image of their customers in 2023 and leveraging customer data to create RMNs now that personalization is a requirement for customer engagement.

From pandemic shutdowns to supply chain issues, disruptions in the retail industry called for renewed agility and innovative solutions from brands to attract and retain customers. In 2023, customers will continue to seek personalized and valuable content at every step of the purchasing journey. Rapid digitization requires retailers and marketers to adapt their strategies to become more customer-centric, digital and profitable in the long run.

Originally published at https://businessdor.com on January 24, 2023.