2021 TRENDS IMPACTING THE FUTURE OF RETAIL
Written by: Anjee Solanki
Anjee is National Director, Retail Services USA, of Colliers. Based in San Francisco and with 28 years of experience, she provides strategic leadership to over 500 specialized retail professionals across 163 offices. Check out her post on Colliers Knowledge Leader here.
Phew! We made it through another year of retail’s unusual twists and turns. The trends that caught the most attention blend the physical space with complementary digital platforms that expedite the customer journey. The underlying theme prioritizes convenience and an enhanced, contact-less shopping experience.
The underdog trend of the pandemic
QR codes gained a level of unprecedented notoriety as they paved the shortcut to contact-less information exchange. The mobile-first technology uses native QR scanning capabilities accessible on smartphones to streamline processes for restaurants and retailers. QR codes have been in circulation for a while. Pre-pandemic, blockchain technologies used them to offer consumers transparency into products moving through the supply chain. We anticipate it will pave the way toward more advanced contactless tech iterations.
The expanding digital wallet
As more and more customers choose to pay for goods and services using digital platforms like Apple Wallet, Google Pay and transactional sites like Zelle, retailers are now offering several different payment options in-store. For example, recently, on a visit to CVS, the self-checkout gave me the option of paying via Venmo, PayPal or Klarna. In addition, PayPal and Venmo introduced a contact-less QR code payment for their customers nationwide in expanding their service offering.
The proliferation of health retail
Health and wellness-related brands popped up in retail corridors nationwide, providing communities with access to healthcare programs during the height of the crisis. The launch of Amazon Pharmacy heated up the retail pharmacy sector as known brands like CVS Caremark and Walmart Health entered the prescription space. And yes, even landlords began to see the silver lining, as many considered the benefit of adding health care amenities as an incentive to tenants.
Interactive shopping gets real
Live commerce offers a multi-dimensional shopping experience for those consumers limited by online shopping and feeling real-life FOMO. Chartered by China’s Alibaba, live shopping channels have become a lucrative revenue stream for social media influencers. An advantage to live shopping is that it creates space for an interactive dialogue between brands and customers that accelerate the purchasing journey. According to McKinsey’s latest report, brands that host live events report conversion rates of nearly 30% — 10x higher than general eCommerce. Live shopping platforms are popping up on Twitch and Twitter. The first retailer to test Twitter’s platform, Walmart launched a live shopping experience that included the option to shop its other channels, including Walmart.com/live, Facebook, Instagram, TikTok and YouTube accounts.
Micro-fulfillment retail strategy
Generated by the popularity of ghost kitchens, retailers optimize brick-and-mortar footprints to include dedicated space for micro-fulfillment centers. These dark store build-outs enable companies to customize retail locations to meet consumer demand for increased convenience while also providing a nouveau shopping experience. “Brands, working with their real estate brokers, need to consider how they can carve out space for a customer lounge area, a gorgeous visually-pleasing shop, but also a backfill center to facilitate purchases,” shares Tami Brooks, a visual merchandising expert.
If you build it, will they come?
And then, of course, there’s the newly forged metaverse. As we recently discussed on Retail Recorded, it is unclear how quickly the metaverse will take over our physical and virtual space. Still, retailers will likely need to embrace innovative formats like augmented reality (AR) and virtual reality (VR) for the next-generation shopping event.