Technology has played a huge role in the rapid changes that retail has undergone in the past two years – but it could yet to play its trump card in 2022. There is a three-pronged assault on the retail industry from mobile, marketplaces and the metaverse; all of which are set to cause yet more upheaval for the industry.
Firstly, marketplaces have accelerated their dominance in ecommerce, with the latest round of research pointing to almost three quarters of UK shoppers saying that marketplaces are the most convenient way to shop online. More than half shop exclusively on them.
Marketplaces have driven a revolution in ecommerce and, as they offer choice, convenience and competitive pricing, are set to become they way that shoppers shop. For many retailers it is a matter of when rather than if they are going to start selling through marketplaces. Consumers are heading that way in droves and so it could well be that they become the de facto way in which shopping takes place online.
Secondly, mobile has also come to dominate the way consumers worldwide access the internet and how they shop. A separate study shows that consumers spent more than 100 billion hours in shopping apps in 2021, up 18% on the previous year, with fast fashion, social shopping and big brands leading the way. Much of this was down to Amazon and Prime Day.
The convenience and ubiquity of mobile also chimes with the advantages of marketplaces that consumers are finding so attractive – together, these two make for a potent combination that can offer levels of convenience hitherto only dreamt of.
Mobile has also spurred on a rise in ‘instant food delivery’, with apps such as Uber and Deliveroo seeing burgeoning use across 2021 and placing these companies at the heart of many new online retail strategies, both in grocery and further afield.
With delivery a key ecommerce battleground – and something that consumers demand, despite being well-aware of the problems the UK is facing with logistics – the tie up between rapid delivery, marketplaces and mobile only piles on the advantages of the shift to a mobile-marketplace model.
The third tech trend comes at somewhat of a tangent to mobile and marketplaces, but will nonetheless have an impact as it reshapes the user experience significantly and offers a raft of new opportunities to delight cusomtomers. The rise of the metaverse is upon us.
We are going to be hearing a lot about this virtual social world in 2022, with record investment being made in UK VR firms and many retailers – particularly in the luxury space – already making forays into this new online domain.
A fourth trend is that of subscription retail. This is set to grow significantly across 2022, with a rise in use of the model around physical goods selling. Coupling this with the growing use of marketplaces and mobile – not least with rapid delivery – and a whole tranche of new retail services are likely to be born this year.
Together, these new retail tropes combine to make retail in 2022 look very different to pre-pandemic days – the only question remains as to how?
The changes that are set to come will, for some retailers, help them build on a surge in sales in December and could be the key to continued growth. Tesco, Sainsbury’s, Dunelm and JD Sports are among a growing coterie of retailers that have had a promising Q4 and have all raised their full year forecasts.
For all retailers, however, more of the same in 2022 is not going to be enough. Adding marketplaces, mobile and exploring the metaverse are all going to play a key role in how these brands – along with all others – look to maintain momentum in 2022 and beyond.
Retail operates in a sphere where the customer is king and the customer is an autocrat: they want it fast, seamless and cheap and they want a good experience. All you have to do is meet those demands.
