As always, with a new year comes new trends in the world of retail and ecommerce.

From innovative retail technologies to surprising new sales channels, here are eight of the top innovative retail trends to keep an eye on in 2021.

Retail Trend #1: Social Commerce

This year’s surge in online shopping is here to stay, especially given the hurdles presented by the COVID-19 pandemic and the closure of brick-and-mortar stores. According to a recent study, in 2020, nearly 41% of customers said they were currently shopping online for things they would normally buy in-store.

Social commerce — native shopping experiences on a social media platform — offers shoppers an even more seamless way to shop online. Instead of clicking through to a third-party website, users can make purchases right from the social media app or site.

And social commerce is on the rise. In 2020 alone, we saw a partnership between TikTok and Shopify, an expansion of Snapchat’s Native Stores for brands, and the introduction of Facebook Shops.

Shops are custom storefronts for businesses on Instagram and Facebook. Sellers can create collections of featured products, as well as modify the look of their Shop with banners, images, colors, and buttons. The same Shop can be accessed from both Facebook and Instagram, so once it’s set up, sellers have the potential to reach a wide global audience on two platforms. 

With Shops, Facebook is catering more directly to brands than they have in the past. This is part of Facebook’s effort to create a personalized shopping experience for users in the “Shop” destination of the app, which we expect to become more prominent to users in the near future. 

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“The idea here is that a user will eventually be able to do all their shopping within Facebook or Instagram, limiting any requirements for direct site traffic. In a way, it’ll be similar to brands trying to sell their products on Amazon by reaching a huge user base and making it easier for them to follow through on a purchase.” 

Avi Ben-Zvi, Group Director of Paid Social at Tinuiti

 

 

In 2021, we can expect to see social commerce become an even more integral part of the ecommerce experience for brands and shoppers alike. 

Retail Trend #2: A New Approach to Influencer Marketing

Influencer marketing used to be all about selfies, carefully-constructed captions, and heavily-edited product shots. But in 2020, we’ve seen a major shift in the way brands and influencers work together. Influencer content has slowly transitioned to a raw, real aesthetic, and this change will continue into 2021.

Audiences put trust in brands that showcase authentic voices, and today’s savvy users can spot an overly-produced ad from a mile away. Brands that don’t prioritize authenticity in their influencer partnerships can wave goodbye to high engagement and ROI next year. It’s time to focus on unique influencer content that prioritizes education, entertainment, and the viewer experience.

From a media mix perspective, video will be 2021’s most important medium for influencer partnerships. With many brick-and-mortar stores closed, shoppers can’t try on apparel or test out gadgets in-store — and a video is the next best thing.

In fact, brands have already started partnering with influencers to create and share content on IGTV, Instagram Live, TikTok, and Instagram Reels to build and foster digital communities. Take fitness authority Bandier, for example. Bandier partners with industry leaders to run workouts on IG Live, then publishes the videos to IGTV for those who miss the livestream. It’s a way to bring the brand’s community together through a shared interest while also demonstrating its gear’s durability. 

 

 

Overall, brands will need authentic video content to keep their influencer campaigns engaging in 2021. 

Retail Trend #3: Online Stores in Offline Spaces

Many digital native, direct-to-consumer brands like Bonobos, Glossier, Casper, and Warby Parker started online, but have since launched and expanded their physical presence over the past few years. Most of the digital brands opening stores sell apparel, which makes sense; it’s a category where shoppers benefit from interacting with the product in person. 

Last year, real estate experts predicted that digitally native brands would open 850 brick-and-mortar stores in the next 5 years, with New York being the most popular destination. And while the COVID-19 pandemic has undoubtedly slowed the openings of new brick-and-mortar stores, we’re still seeing offline experiences from previously online-only brands, and will continue to in 2021. 

Take the opening of the first brick-and-mortar Amazon Fresh Grocery Store in September, for example. The Amazon Fresh grocery store is a new grocery store designed from the ground up to offer a seamless grocery shopping experience, whether customers are shopping in-store or online.  

 

 

This new initiative from Amazon brings the ease and accessibility of ecommerce to brick-and-mortar grocery shopping. The Amazon Fresh grocery store offers same-day delivery and pickup, as well as Amazon.com package pickup and returns. Amazon also launched the Amazon Dash Cart to help customers skip the checkout line.

Going into 2021, we can expect to see brands — giant retailers and smaller DTC brands alike — continue to create offline experiences that leverage the technology and convenience of ecommerce.

“We’ll continue to see marketplaces and traditional retailers converge. It’s happening both ways, where marketplaces like Amazon are moving to forms of traditional retail, and traditional retailers like Albertsons are making the move to marketplaces to stay relevant in the digital economy.”

Greg Chapman, SVP Business Development, Avalara

Retail Trend #4: Even More AR-Powered Shopping Experiences

Augmented reality (AR), machine learning, and artificial intelligence (AI) are here to stay. According to a Nielsen global survey from 2019, consumers listed Augmented and Virtual Reality as the top technologies they’re seeking to assist them in their daily lives, with 51% saying they would be willing to use AR technology to assess products.

And while AR in retail isn’t new (Facebook made some big AR moves in 2018), it’s gone from a nice-to-have to an essential part of retailers’ ecommerce offerings.

As so many shoppers continue to rely on online shopping during the pandemic, retailers leverage AR technology to bridge the gap between the digital and the physical. In fact, IBM’s 2020 U.S. Retail Index reports that COVID-19 has accelerated the shift to digital shopping by roughly five years. 

While brands like IKEA, Home Depot, and Target all have proprietary AR shopping experiences, AR-powered commerce isn’t just for mega-brands.

Last year, Shopify introduced Shopify AR, an easy-to-use toolkit for businesses to create their own AR experiences to showcase their products to customers. And it works: Shopify reports that interactions with products having AR content showed a 94% higher conversion rate than products without AR.

 

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Image source: Shopify

 

All in all, look for more brands taking advantage of AR capabilities in 2021 — and more shoppers seeking out those AR experiences to make purchase decisions. 

Retail Trend #5:  Creative Brand Identities on Amazon

Even as new shopping experiences continue to emerge, Amazon reigns supreme when it comes to online marketplaces. During Q2  2020, Amazon generated its highest net revenue yet — almost 88.91 billion U.S. dollars — even higher than during the holiday shopping quarter (Q4) in 2019. 

For brands on Amazon, building brand equity can be a challenge. But a strong brand identity is crucial for connecting with shoppers and establishing trust. The good news? Amazon has introduced more tools than ever for brands to build unique brand identities on Amazon, including: 

 

 

“Amazon continues to emphasize and release opportunities for brands to tell their story and build brand equity across its platform with content. With this comes the introduction and adoption of New-to-Brand metrics and the beginning of tracking the impact of these efforts. I believe tracking metrics will inevitably need to continue to expand as brands become increasingly interested in understanding the impact their advertising and creative strategies have on attracting new consumers to purchase.”

Zak Semitka, Specialist, Marketplaces at Tinuiti

 

 

We expect that Amazon will continue to support brands’ abilities to creatively advertise and differentiate their brand identities going into 2021.

Retail Trend #6: Ethical and Values-Based Brands on the Rise

Transparency, values, and ethics have never been more important to shoppers — which means brands need to prioritize them ASAP. 

71% of consumers prefer buying from brands that align with their values. And according to Forrester, shoppers are increasingly evaluating products and brands based on a company’s ethics and values, with 41% of US consumers actively seeking to buy from a company associated with social, environmental, and political ideals.

“This isn’t some nice ‘corporate social responsibility’ activity that looks good on the glossy pages of an annual report. Companies that put their values into action grow faster than other companies . . . Embedding your values into your business operations is hard but necessary to convince jaded consumers that you are truly committed.”

Jim Nail, Principal Analyst at Forrester

For brands, this shift to values-based consumers means that brands who are traditionally less forthcoming will no longer be able to get away with hiding any sketchy business practices or environmentally-unfriendly operations.

Offering genuine transparency and taking a stance on ethical issues can be risky for brands, but when done right, it can build lasting customer loyalty and trust.

Retail Trend #7: Same-Day (or Faster) Delivery

It wouldn’t be a retail trend roundup without mentioning fulfillment, especially when sales from same-day shipping pioneer Amazon are higher than ever. 

It seems like customer expectations for shipping times are only getting faster. First came 2-day via the rise of Amazon Prime, then next-day, then same-day. And big-box stores are following in Amazon’s footsteps, with Target growing their Shipt service and Walmart expanding their two-hour express delivery options. 

But in the age of instant gratification, shoppers want their orders ASAP. And same-day, store-fulfilled orders are seeing more traction from customers and brands alike. PwC reports that 88% of consumers are willing to pay for same-day or faster delivery. From Amazon’s Prime Air — which uses drone technology to deliver shopper’s orders in 30 minutes or less — to the rise of delivery robot startups, delivery is only getting faster. 

While same-day shipping is far from a new concept — in 2018, 51% of ecommerce retailers already offered same-day delivery — we’re likely to see it become the norm and beyond as order fulfillment technology and standards evolve in 2021.

Retail Trend #8: Increase in Smart Speaker Shopping

It seems like everyone these days has an Amazon Echo or Google Home.

Smart speaker sales reached a new record in 2019, up 70% from 2018. And it’s still growing: By 2025, projections suggest that the global smart speaker market could grow to over 35.5 billion U.S. dollars. 

87.7 million adults in the U.S. own a smart speaker — which equates to an adoption rate of over one-third of consumers.

So, with smart speakers already such a commodity for so many consumers, how will the trend progress next year? 

Amazon Echo and Google Home smart speakers have become key tools for many online shoppers, especially as we all spend more time at home during the pandemic. Around 20% of smart speaker owners use them for shopping activities, such as ordering products, conducting product research, or tracking deliveries. This figure is expected to jump to 52% within the next four years.

As we move into 2021, we can expect to see more consumers online shopping without ever having to look at a screen, especially on Amazon. But even brands who aren’t on Amazon can leverage smart speaker and voice search technology. Here’s why: When a voice assistant provides an answer, it also allows users to open the website where the answer was found. For brands that prioritize voice-optimized SEO, this could mean a boost in traffic.

What innovative retail trends are you most excited about for 2021? Comment below and let us know!

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