Amid a nation reopening and reconnecting, retailers have good reason to be optimistic.
The National Retail Federation now projects that retail sales will grow between 10.5% and 13.5% in 2021 as the economy accelerates its pace of recovery.
But with the holiday shopping season fast approaching, and starting earlier than ever, retailers should also feel a sense of urgency to act. Now is the time to be differentiating your brand and adapting to new consumer preferences in preparation for critical moments that matter—from back to school to that increasingly important period known as “Q5.”
Success starts with a deep understanding of the shopper mindset, so let’s explore a few key factors motivating spending today and the opportunities they present for brands.
1. Reconnection fuels an urge to splurge
Many Americans are enthusiastically starting to spend again after a year of social distancing, at-home meals and missed events. McKinsey found that more than half expect to spend extra by splurging or treating themselves, with higher-income millennials intending to spend the most.
But people aren’t just looking to buy. They’re eager to reconnect with others—a distinction fueling the release of pent-up demand. Reconnection is driving a desire for bigger, better back-to-school wardrobes, home improvements for backyard BBQs and the like.
By thoughtfully crafting experiences that build on moments they’ve missed, you can deliver greater value for customers and help drive business recovery. No matter your industry, consider how your products, services and brand can give customers a joyous return to the familiar. And prepare inventory management processes for a potential increase in demand.
2. Hybrid experiences combine the best of digital and in-store
2020 accelerated the decades-long growth of ecommerce and fundamentally changed the way people discover, shop and buy. Ready or not, the future of shopping has come early.
Driven by the demand for an expedited brick-and-mortar experience, shoppers increasingly expect stores to offer the transactional speed and conveniences they are used to online—from easy, personalized selections to fast, frictionless checkout and curbside pickup.
Inversely, people are mimicking much of the physical store in their own homes. On mobile, they can interact with live shopping or cooking demos, use AR to “try on” cosmetics or stage furniture in their living rooms, and message directly with sales associates. Technology is enabling more personal and immersive experiences online.
The roles of in-store and online are blurring. So, focus on seamless hybrid experiences that bring the best of online in store, and vice versa, to meet consumer expectations.
3. Brand loyalty is up for grabs
During the pandemic, we saw a mass disruption to brand loyalty. By April, nearly 40% of U.S. consumers surveyed by McKinsey had already switched brands or retailers.
Strong and differentiated branding can help reach and retain customers in the most competitive marketplace we’ve ever seen. Your challenge as a retailer is to create mobile-first, attention-grabbing creative that speaks to your unique values. Over two-thirds of consumers prefer brands that align with their personal values—so think beyond price and convenience.
We all had to adapt to pandemic life and our rituals have been forever changed as a result. Now, people and businesses have the opportunity to shape our next normal. Take this time to address how your brand and customers’ priorities may have shifted and how to stand out in a world of infinite choice. Innovation assumes many forms, so don’t be afraid to break from tradition to meet consumers’ changing needs.
How will you adapt to the changing retail environment?
There are plenty of reasons to be excited about retail in 2021—but there are also a lot of shifts that retailers must quickly adapt to. With the holidays around the corner, a successful holiday season starts with action and agility now. Consider:
- Demonstrating how your brand and products enrich and enable reconnection;
- Creating personalized hybrid shopping experiences that make in-store more efficient and digital more immersive;
- Getting discovered by relevant audiences where people are spending time on mobile;
- And investing in differentiated and frequent brand building that speaks to your unique values and helps keep you top of mind.
For more help preparing for upcoming moments that matter, check out Facebook’s Discovery Commerce hub and turn on the power of personalization this holiday season.