By basic definition, shopping is the purchase of an item in exchange for money — however, today’s excessively digitized era has disrupted this definition. Whether for the better or the worse, there seems to be no going back now.
In days long gone, one had to visit a store in person to make a purchase, with ads for products only being seen in moderation in newspapers or during the occasional commercial break on television. If the state of the retail industry over the last few years could be summed up in one word, it would be ‘uncertainty’. From store closures in the thousands, to the rise of e-commerce, not to mention shaky economies and inflation — what is the future for retail?
Shopping is now more than just a transaction
Recent years have shown an increase in Social Media platforms. It is near impossible to find a person who does not spend time scrolling on their phones at some point during the day. Initially, social media platforms allowed for users to share tidbits of their lives and keep in touch with loved ones across the world. Now, it is arguably the most impactful marketing tool for companies and today you could even build a career in social media management and marketing.
Social media users have argued that as of late, the saturation of ads and promotional content in their feeds is making the overall social media experience less than ideal. The irony of the matter is that these digital ads are the only effective way for companies to promote themselves these days.
According to Google Consumer Insights, the goal of the next era of commerce will be about “how close retailers can get to consumers and the places where they spend their time — places where demand, discovery, choice, and consumption happen.”
Content or ad — are the two becoming indistinguishable?
It appears that commerce and content are melding into one as time progresses. We have retailers participating in social media trends to promote new products in order to appeal to younger generations like Millennials and Gen Z who are a growing percentage of the workforce. It is predicted that by 2025, Gen Z — the first generation to be raised in an entirely digitized world — will make up 27% of the workforce.
Influencer culture is at its peak and it has been noted that both Gen Z and Millennial shoppers are twice as likely to agree that “watching an online video was their most influential shopping activity,” when compared to shoppers of the previous generations. With retailers invading personal spaces like social media feeds, there has been a rise in expectations of personalization from shoppers with “73% of shoppers expecting brands to understand their unique needs and expectations.” YouTube stands out amongst its peers in enabling Gen Z shoppers to make retail decisions — be it informed or impulsive.
It should be noted that Gen Z still makes 42% of purchases through brick and mortar stores, and Millennials closely follow with 38% of purchases made offline.
Allied Market Research has deduced that by 2030, the global autonomous last-mile delivery market is projected to reach $90 billion.
Consuming consciously
Recent economic changes and general uncertainty has led to consumers being more intentional about where they spend, placing more importance on brand value rather than price point. Approximately 70% of people have agreed that they would show brand loyalty even if there are price increases, on the condition that they feel valued as a customer.
On the other hand, consumers do show an increasing concern over personal data and privacy. “79% of global consumers say they are concerned about data protection and privacy on the internet, and 72% believe they are very or somewhat at risk from people or companies misusing their personal data,” as per data collected by Kantar’s Global Monitor.
This style of retail is expected to stay indefinitely with massive potential for growth and as such, retailers need to remain adaptable in order to offer their customers good value with no risks.