The pandemic brought disruption to retail in both 2020 and 2021, and it appears to have brought retail to the tipping point towards an innovative future for shoppers and retailers alike.
Supply chain disruptions have led to a logical outcome: retailers are looking for alternate methods of getting products onto their shelves. From loading products onto a container ship at a foreign port, unloaded at a US port, trucked to a distribution center, and delivered to a customer’s doorstep, retailers have been looking to diversify their options. Last-mile delivery now includes everything from a gray Amazon van to an Uber Eats delivery person. Retailers won’t be caught off guard in the same way again.
The power-position of the workforce has pivoted. Similar to a real-estate’s buyer’s market versus a seller’s market, the upper hand has slipped into the hands of the employees. A retailer in Washington state recently confided to WR that she used to tell her employees what hours they would be working. “Now, my employees tell me when they’ll be working, and if I don’t agree, they quit and find another job right away.” Higher wages are requisite to keeping employees from joining in on the Great Resignation.
Inflation and the omicron variant have sent retail prognosticators for a loop. While retail sales have never been more robust, nothing is certain in the year ahead. Although mainly due to skyrocketing automobile prices, inflation at a 40-year high is impacting customers’ discretionary dollars. The unknown effect of omicron is also worrisome to shoppers, enough to put those dollars into their savings rather than their next retail purchase.
Other retain components will continue to change in the months ahead, including:
- Target marketing will grow increasingly difficult as consumer data protection measures continue to be rolled out, such as Apple’s iOS updates and Facebook protecting its users from ads based on their demographics or web habits.
- How retailers are diversifying their revenue streams by adding services to complement product sales
- Manufacturers will counterbalance wholesale with direct-to-consumer sales.
Brick and mortar stores will continue to evolve, bringing customers in with a focus on providing an experience.