Retail Predictions for the Holiday Season and Beyond
When thinking of the 2020 holiday season, “normal” is likely the last word that comes to mind for many retailers. Instead, they might think of the last holiday season as “resilient” or “historic.” E -commerce surged then and now, and as another unique holiday season approaches, pair that uniqueness with much improved consumer optimism. Despite crumbling or slow supply chains, the upcoming major sale moments are poised to be quite interesting and, likely, groundbreaking.
Looking at the next few months, retail sales are projected to grow by double digits (up to 17.9 percent), with 2021 posting a record $933 billion in sales. And with so much on the line, retailers and brands would be wise to pay attention to emerging trends or risk faltering — instead of thriving — under the holiday lights.
AR and AI Will Improve Engagement
Augmented reality (AR) isn’t new. However, over the past year as consumers have become less and less keen to shop in-person, e-commerce has embraced the technology — allowing shoppers to “see” potential purchases, from cosmetics to clothing to home furnishings. AR’s potential has already been harnessed by brands like Sephora, Macy’s and Walmart, and shows no signs of fading. In fact, experts estimate that 120,000 online stores will be using AR technology by 2022.
In the same vein, artificial intelligence (AI)-powered chatbots are also slated to see an increase in use this holiday season — largely because many brands lack the manpower to run their businesses with a human-first approach. So, while chatbots can be off-putting for some, they have — and will continue to — become the fastest-growing channel for communication between a merchant and its customers. Through communication and, almost more importantly, listening to consumers, these tools are only going to become more intuitive and can help brands and retailers not only improve customer engagement, but also boost personalization and create a more enjoyable and pleasant customer experience, which is the ultimate goal.
Specialty Stores Will Drive ROI
One of the most effective ways for brands and retailers to make the most of the holiday season this year is to provide a shopping experience that aligns with key segments of their customers. Merchants should source more readily available technology to craft a specialty store experience for groupings of the market, such as employees, friends and family, VIPs, loyalty members, etc. Specialty stores can deliver unique pricing, custom catalogs and distinct business rules that are customized to important audiences without disrupting the main e-commerce channel. They can both insulate the brand from a liquidation event or build buzz for a product launch. Segmenting the shopping experience has been an underemployed strategy because e-commerce solutions have been too slow and expensive to adapt.
Now retailers can launch specialty stores as digital “pop-ups” to sell to a global audience to improve product turnover and increase margins.
With so much on the line — from loyalty to revenue and more — the 2021 holiday season is shaping up to be yet another historic retail moment. To break through the noise, retailers and brands should take advantage of emerging technologies and strategies to better reach individual consumers and, ultimately, make the most of this valuable opportunity.
Dan Wallace-Brewster is the senior vice president of marketing at Scalefast, an enterprise e-commerce platform solution.
Related story: The E-Commerce Secret Weapon: AR and VR
Dan Wallace-Brewster is the senior vice president of marketing at Scalefast.