Each year trends are upended and replaced by new ones. Nowhere is this truer than in ecommerce and retail.
So what should we look out for this year when it comes to retailers?
We’ve already seen that both 2020 and 2021 were heavily impacted by the pandemic. The series of challenges that retailers were faced with last year revolved around supply chain pains brought about by the resurging demand as well as shortages in staff.
While nothing is certain as we move into 2022, there are a few trends to keep your eye on this year. Let’s take a look at some of them.
Supply chain investment. Global supply chains underwent huge stress tests during 2021 as retailers struggled to restock shelves. While issues may subside during 2022, numerous issues and pressures are likely to remain. So this year may be the time to reevaluate and reinvest in the long-term health of supply chains.
“Retailers had designed their supply chains to address predictable and specific challenges but had not adequately invested and undergone the end-to-end structural transformation necessary to become truly agile,” stated a recent report by Christa Hart, Ron Scalzo, and Matt Garfield. That may be about to change this year.
Unknown apparel. 2021 breathed new life into apparel sales after a dwindling performance in 2020, when 1.8 million of us never even bought a sock-worth of apparel. That led to 60% of consumers saying that by 2021, their wardrobes needed a refresh.
By December 2021, ecommerce apparel rose 17.3% year on year. So what’s in store for 2022? It’s likely that apparel growth is going to settle down after a strong 2021 that coincided with the reopening of much of our lives. Also, like what we’ve seen since the back end of last year, retailers have not been offering the same level of discounts and promotions like past years, which is going to continue to discourage sales.
Inflation concerns. The rising cost of goods is another problem that is beginning to affect us. The consumer price index rose to 6.8% back in November. As a result, ecommerce prices rose 3.5% in the same month, which was also the 18th consecutive month of inflation. If the rising cost of goods continues, it’s going to continue to impact how much we spend.
Branching out. Retailers are broadening their revenue streams in order to diversify. That has meant not only selling products but also services – and increasingly B2B services.
“In an era where customers have come to expect speed and reliability,” said John Furner, CEO of Walmart, “it’s more important than ever for businesses to work with a service provider that understands a merchant’s needs.”
The store evolution.
With the growth of ecommerce and fall of the mall, retailers have had to squeeze the size of their store size. Yet last year, while many stores were closing, retailers began to rethink what stores are and experiment with ideas.
Nike is famous for its experimental neighborhood-based stores while Dollar General expanded its concept of a higher-end discount store with its ‘treasure hunt’ appeal. And many retailers are experimenting with more omnichannel experiences which blend digital and physical experiences, such as using a retail app in store to get special offers.
Home-grown brands. In order to shore up market share, retailers have continued to develop their own brand products yet not by making them as just cheap alternatives but rather upgrading their labels. Plus, with inflation eating into our savings, private labels may be well placed for plenty of growth in 2022 as they become more appealing.