There is a sharp contrast between what consumers want from retail brands in 2023 and how those businesses intend to meet these demands, a new study shows.
The Business Growth Report from Productsup, a Product-to-Consumer (P2C) software company, suggests that consumers are looking for better product data, more sustainability, the metaverse and more targeted ads, however retailers are finding it hard to meet these needs in these cost conscious times.
The report identifies four key areas where businesses should focus their attention in 2023.
Businesses’ concern over the quality, consistency, and accuracy of product information across global campaigns is on the rise. Sixty-two per cent (62%) of businesses fear poor product information is creating negative online experiences, up 72% year-over-year. Additionally, 55% feel it could leave them vulnerable to competitors, up 49%.
Considering consumers reported that knowing more detailed information about products was one of the top factors that would entice them to choose one brand or retailer over another, companies need to have full control over their product data ecosystem.
Nearly half (49%) of businesses recorded increased demand for sustainable products in 2022, but 34% of consumers say brands and retailers make sustainability information too difficult to find.
Providing shoppers with more transparency in the supply chain by adding ESG data to product labels, listings, and ads can have a significant impact on sales and brand loyalty. In the year ahead, 55% of businesses plan to increase their level of sustainable product information to meet evolving consumer expectations and differentiate themselves from competitors.
The metaverse and digital collectibles
In light of skepticism across the industry, many businesses are avoiding virtual and augmented reality experiences. Only 14% of businesses believe consumers are much more likely to purchase a product based on in-store AR experiences, such as augmented fitting rooms. That number drops to 13% for online VR and AR experiences, like the metaverse and digital collectibles.
Yet when compared to consumer data, 42% of consumers said they’re more likely to purchase a product after experiencing VR or AR in stores, and 40% expressed interest in purchasing ‘pure virtual’ goods in the metaverse. Companies that show caution toward these innovative technologies now miss an opportunity to make their mark in the space before clear leaders emerge and win over younger shoppers.
With tighter budgets, only 24% of businesses expect to increase overall ad spend this year. They’re pulling back on newer channels – 79% of businesses don’t intend to increase Snapchat, or TikTok ad spend – and instead focusing on the platforms they’re more familiar with, like Facebook and Youtube.
This dip in activity from advertisers opens up more ad space for others to grab – and at discounted costs. Businesses should take the opportunity to secure top advertising spots on some of the most-used channels by Millennials and Gen Z.
“If most businesses are struggling to drive sales, move out inventory, and reach new customers, then it’s time to stop following the majority,” explains Marcel Hollerbach, Chief Innovation Officer at Productsup. “History has shown that harsh economic climates reward the brave outliers who embrace change and go all in on innovation. To be successful in 2023, companies have to be willing to experiment and invest in areas that are outside the norm.”
The report is based on a survey of 755 senior decision-makers from 16 countries – either personally responsible for or reporting to those responsible for – managing product information at their organisation.