The roar of consumer demand is loud and clear. Impatience and urgency amid a pandemic redefined retail in 2021 and the push for direct-to-consumer options that skip the middleman, paired with a “Where’s my stuff?” mentality, have pressured retailers to up their game and innovate.
While L’Oréal CEO and Chairman Jean-Paul Agon made waves a year ago with his post-COVID forecast that a roaring ’20s rebound was in store, that prediction was based on a relief rally by pent-up consumers, rather than the steady market share gains and shopping shift that has driven record numbers of customers to embrace a digital first mindset.
As it turns out, the “roar” retailers hear now is that of consumers demanding a better experience where the gap between when an online order is placed and when someone is holding in their hands is minimal.
On that note, this year will perhaps be remembered as a time where speed was a retailer’s key differentiator in an online-heavy, delivery-obsessed world, removing barriers to consumer access and ease remained a top priority amidst supply chain woes, and delivery to doorsteps captivated consumers who expect nothing less.
As the year ends, the team here at PYMNTS reflects on two emerging trends of so many that may continue to gain big traction next year and beyond.
Consumers’ ‘Bring it to me Now’ Mentality Makes Retailers Want to be Faster
The shift to digital involves a race among retailers to see who can create the most seamless consumer experience, whether this be via delivery, curbside pickup, in-store grab-and-go, and beyond. In the meantime, retailers are struggling with inventory issues, cost problems, and shipping logistics amid a pandemic that brings a slew of critical and urgent challenges.
“There is no shortage of stories about the supply chain delays and impact on retailers, but shoppers have grown to expect to receive their purchases fast regardless,” Onfleet CEO Khaled Naim told PYMNTS. “The new players in quick-commerce coming out of the pandemic have reinforced how important it is for retailers to have a long-term delivery strategy that takes consumers’ expectations into account, or else [they’re] risking market share to competitors that are,” Khaled added.
Opportunities abound, namely leveraging data to smooth out pain points. As PYMNTS reported, a blend of better tech and more advanced analytics is a viable solution to ensure that in an Amazon-driven world, goods arrive faster than ever.
A focus on that “last mile” — moving a product from warehouse to consumer doorstep — is crucial. Amazon, for instance, is skilled at this and does the bulk of shipping analytics work (such as where a product is versus where a consumer is and what the best shipping route is) before an item is placed. A snowstorm or tornado that may further delay shipping? This is all factored into the analytics equation by Amazon.
Said Zohar Gilad, CEO of Fast Simon, “What is unique now, given the work/labor dynamics and decreasing tenure of [retail] employees, is how quickly retailers can get people up to speed on systems and get technology implemented — before someone leaves.”
It’s this behind-the-scenes approach to retail that will hopefully carry the industry forward and please and delight consumers along the way. Figuring out before a sale is made what the shipping looks like will alleviate consumer worry about where their packages are.
That feeling when a package unexpectedly arrives a day or two earlier than planned? Priceless.
Direct-to-Consumer Subscription Services With Unique Experiences are Wooing Consumers
It’s the era of the retail subscription service. It’s a medium where consumers are getting more for their money and therefore feel an affinity toward those unique brands offering unique experiences.
Venture capitalist firms are investing big money into direct-to-consumer companies and primo direct-to-consumer Amazon sellers, too.
Take chocolate, for instance. Last Spring, Hershey’s offered direct-to-consumer purchasing of a 2.5-pound box of Reese’s peanut butter cups for $29.99. Also on the direct-to-consumer push recently is Coke’s subscription service which lets consumers try new Coke drinks (and swag, too) for a $45 monthly subscription.
Options like these engage the consumer mentally and emotionally. It perhaps feels like a luxury for a consumer to get sweets and sugary concoctions in bulk compared to the typical grocery or convenience store versions. For a soda addict to try new flavors is likely an exciting rush, and expecting new flavors each month keeps someone interested.
In this way, perhaps the ultimate key to a quality subscription service is delivering an experience consumers justify spending money on. “The test for D2C is always: ‘Can you provide a value proposition that really resonates with the consumer?’ Because that’s when you get the repeats. That’s when you get the sustainable proposition,” said Gibu Thomas, former head of PepsiCo global eCommerce.
When a subscription service also offers consumers a slice of the company’s culture, this is when true magic happens.
This “culture” is something brands are redefining on a dime and sometimes tying more to consumer need than consumer want. Some companies — Chewy being a good example — pivoted fast when their pet supply delivery services faced delays due to global supply chain issues. Chewy offered consumers things like pet food in bulk delivered to your doorstep. Chewy asked what consumers needed during this time related to what its customers had in common — furry friends and well-loved pet companions.
So, Chewy began offering consumers pet insurance, telehealth options and assistance filling prescriptions. Chewy chose these sectors to dive into because these were, for Chewy, hot markets to get into that its customer base needed and demanded in a pandemic, and beyond.
“We view this as a huge opportunity … to drive greater customer engagement, brand loyalty and greater consideration for healthcare purchases either on or through our platform,” said Chewy CEO Sumit Singh.
Greater Implications
Like the 1920s, the 2020s are also roaring with the sound of consumer demand. The products being sold are important, but so is the actual purchasing process, such as the ordering and shipping process from the consumer’s perspective. Also of critical importance to the consumer experience is how a brand can create new relationships with a consumer by changing up expectations for what a brand should be.
The roar of higher expectations and unique experiences won’t be silenced, nor should it be. But listening to this roar and assessing how to answer the call will be key to ongoing retail success.
We’re always on the lookout for opportunities to partner with innovators and disruptors.
Learn More