This is a pivotal issue for retailers in the UK, uncertainty around Brexit is still ongoing with new rules set for UK businesses from the 1st January. With this uncertainty comes a lack of clarity on a range of issues including:
The last few years have meant an inability for retailers to adequately plan for the future of their business bringing agility to the forefront.
With the recent US elections results announced, there is still too much uncertainty to predict with any degree of confidence, the impact of the election on Retail in the USA.
The Covid-19 pandemic swept across the globe in early 2020 and enforced national lockdowns which affected operations and created a huge amount of risk for many businesses that relied on in-store footfall.
Whilst there has been a huge economic impact from the pandemic in terms of business survival and job uncertainty, consumer spending continues. Those that already had an ecommerce offering or that made the transition this year are taking full advantage of the online opportunity presented with some experiencing phenomenal results.
The area of inventory-led retail is coming to an end, set to be replaced by the shift towards brand and customer experience. Customers will remain loyal to a brand that caters to their needs but will be more than happy to shift their allegiances when one brand doesn’t hit their desired levels of consumer experience.
Consistency is key for ecommerce retailers. All brand assets, whether website, digital display ads or social media must be consistent and instantly recognisable as that brand. Ads that aren’t simply won’t speak to your target audience and cut through the online noise.
That’s the first step. The next step is to provide the experience, consumers demand. This includes ensuring your Retargeting campaigns are personalised and your audience is segmented as well as promising a seamless cross-channel experience between the online and offline elements of your business – when done right, tactics such as Geofencing can put you ahead of the competition in this area.
2019 was the worst year on record for retail in the UK, with total sales dropping by 0.1%, impacting job losses, shop closures and causing many companies to restructure. In the US, GDP growth was expected to slow to 1.6% in 2020, from 2.3% in 2019, while consumer spending suggested a stall to 2.2% this year, from 2.5% last year.
That being said, consumer behaviour has drastically changed and so the challenge for retailers in 2020 has been to stand out. The brands that have been able to do this in terms of brand, advertising, offering, consumer experience and values will solidify their market position as a go to brand in 2021.
When consumers purchase online they demand options. Specifically, 66% of consumers would spend more with a retailer if they offered more payment options, while 63% say that being able to buy now and pay later would make them more likely to keep more items in their carts.
Credit and debit card payments aren’t going anywhere soon, ‘buy now pay later’ solutions like Klarna are having a huge impact.
Whilst retailers combat cart abandonment through a variety of tactics including Retargeting, offering flexible payment options is another option to reduce this problem in the first instance.
The environmental impact of brands and industries now has a very real effect on consumer spending. This is especially important to younger demographics; those which can be of critical value to many retailers.
In the UK, 62% of young consumers would consider buying from brands that were more transparent about their environmental impact, while 63% will stop using brands that are harmful to the environment.
The importance for brands to illustrate their core values in their advertising and campaign messages is crucial. However, consumers are fully aware of potential “greenwashing”, meaning companies need to follow through with their environmental claims.
Understanding exactly who your customers are and speaking to them with relevance to the times through your brand visuals and messaging has been the key to success in 2020.
Retailers that quickly adapt to address and share updates with their customers provide a sense of certainty in uncertain times and establish powerful brand awareness invoking loyal custom.