10 Retail Trends and Predictions for 2022 by Francesca Nicasio

The retail landscape has never changed faster than it has in the past two years. 2022 is poised to be the first year where the industry has a good handle on what the modern landscape finally looks like. Brands are more adept at making real-time changes necessary to respond to the unexpected changes that have become so commonplace. Stores are also beginning to truly ace omnichannel experiences. But what specifically can we expect to see from the retail industry coming up? Here are the ten trends we predict for the retail industry in 2022.

  1. Brands finally master omnichannel experiences
    Creating a seamless omnichannel experience has been an aspiration for most, if not all, brands since around 2015. Many older brands were slow to change, though, and many younger brands were taking a heavily ecommerce-first approach. It wasn’t until the lockdowns of 2020 that retail was forced to make quick pivots towards providing top-notch omnichannel experiences with things like buy online, pick up in-store becoming a hugely popular fulfillment choice.

As we move into 2022, you can expect that even small retailers will be taking omnichannel seriously from the start. Pop-up shops and local fulfillment centers are set to become standard practice for ecommerce first brands, while brick-and-mortar giants like Target have become pros at offering a sleek site experience and creative fulfillment methods.

  1. Social selling hits TikTok in a big way
    While TikTok has been a massive hit with users for a few years now, brands have been slow to truly monetize the platform. This is partially due to the fact that TikTok didn’t add advertising to its platform until 2020, and only as recently as late 2021 have announced a system that will make it fairly easy for advertisers to work with them.

Since that announcement, though, we’ve seen a rise in brands investing in TikTok’s ads and influencers. Now that some pioneers have figured out a methodology, you can expect to see a lot more retailers jumping on to TikTok.

Not to mention that with solutions like Ecwid, selling on TikTok is a breeze. Simply tag products in your videos to encourage viewers to check them out. Ecwid also streamlines TikTok advertising so you can get in front of more people.

  1. Supply chain issues are going to continue impacting stock
    2021’s Q4 has been plagued by the backup of shipping containers around the world. Going into 2022, we’re likely to see brands get a good handle on how to deal with pileups. For starters, even small brands are likely to start keeping more inventory in sales locations, using urban warehouses or temporary storage systems. Large retailers have actually begun to charter their own freighters in order to overcome the shortages and maintain a competitive advantage.

In the back half of 2022, we may even see deep discounting on stock due to retailers over-ordering to compensate for delays.

  1. Labor shortages will continue to affect pricing
    In the wake of COVID pandemic, multiple industries are seeing labor shortages as employees refuse to work for low wages in dangerous conditions. Working retail became a life or death or choice for many workers in 2020 due to lax safety protocol and more. Simply put — in 2022, plan to pay your employees more to keep them. And expect that the prices of goods, in general, to rise as manufacturers, shipping companies, etc. also need to pay their employees more to keep them. FedEx has already announced a shipping rate raise coming in January due to their labor shortage. One distribution center in Portland, for instance, is operating at 65% capacity due to lack of workers.
  2. Sustainability becomes an expectation
    Fair wages aren’t the only things people are demanding in the wake of the pandemic. Consumers care more than ever about the sustainability of their habits, and that includes their purchases. In fact, as of 2020, a full 32% of US consumers were already prioritizing companies that are actively reducing their negative environmental impact. In 2022, a brand’s own sustainability, as well as that of the items they sell, is going to be a key factor of differentiation in the marketplace. It will become crucial for brands to invest in sustainable packaging, as well as manufacturing and fulfillment methods. It’s also going to be important that brands sell items that help the consumer maintain their personal sustainability such as items that help the shopper create less habitual waste.
  3. Access to marketing automation is going to result in a rise of customized marketing from all brands
    A decade ago, marketing automation software was an extremely expensive investment that only the biggest of companies could afford. Today, even the newest Shopify store can set up an account on Klaviyo and get rolling with customized SMS and email communications. This ease of access has made it so that the marketing basics now include things like winback messaging, which was previously considered to be a fairly advanced flow.

To set themselves apart, brands must begin to look for unexpected opportunities for communication (after they have mastered the basics). One method you can expect to see a rise in is localized marketing. Communicating at scale with regions has never been easier and it’s a quick way to personalize a message.

  1. Livestream shopping hits the U.S.
    In the past few years, Chinese brands have been perfecting a technique called livestream shopping. Reminiscent of QVC, livestream shopping involves a salesperson or influencer discussing products available for immediate purchase on a livestream. The audience can interact with the host and provide the brand with instant social proof. This form of shopping accounted for $170B in 2020 in China.

With the runaway success seen in the Chinese market, American retailers are going to begin to adopt the approach in the upcoming year. In fact, some have already started – like Chico’s, which runs Facebook livestreams fairly often. It will take some time for them to calibrate and master the method, certainly, but get ready to start shopping from livestreams.

  1. Buy-now pay-later purchasing methods will become expected
    Over the past two to three years, companies like Affirm and Afterpay have made a huge impact on consumer expectations. In 2021, BNPL purchases were up 29% over 2020. Paypal alone saw a shocking 400% increase on Black Friday in BNPL transactions. With all kinds of brands from furniture brands like Joybird to apparel brands like Modcloth offering the option, 2022 will be the year that consumers begin to expect to see the option at checkout, rather than find delight in it.
  2. Experiential retail ramps up
    The pandemic ironically proved the value consumers see in brick-and-mortar shopping when global lockdowns hit. While stores could pivot and still offer same-day pick-up options for necessary goods, it became evident that many people enjoy the socializing and entertainment that can be found in stores. As we move into 2022, brands, especially those with large budgets, are going to be investing more in creating a personalized, exciting experience for their in-store shoppers. What this experience looks like will likely vary from personal shopper approaches to full-on retail-tainment approaches like at Nike’s flagship store in Times Square, which has an actual basketball court.
  3. Retention takes the center stage for retailers
    As customer acquisition prices have been skyrocketing in the last few years, marketers have been pushing the importance of customer retention more. As of 2022, though, retention will finally become the official focus of many, many brands. This will result in companies improving their post-purchase experiences, streamlining fulfillment, and increasing their communications with current customers.

It’s likely, though, that as a single customer’s value increases to a company, they’ll be willing to spend more to acquire the customer – resulting in a continued rise in CAC, rather than a decrease. We may be about to see the decline in the boom of small eCommerce shops as they get priced out of being able to even get their first customer.

Wrap up
2022 is going to be a big year for retailers. They’re going to start executing in a big way on the learnings of the past two years. Many of the things that retailers only dreamed of a decade ago will become a reality in 2022.

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