What are the retail trends to watch in 2020?
They say “money makes the world go ‘round”, but perhaps it’s trends…
Whether we see ourselves as trendsetters, trend followers, or ‘edgy’ trend avoiders, when it comes to retail, trends are forever changing the landscape of the industry. And everyone is impacted as a result.
At the turn of the millennium, online shopping was still approached with tentative apprehension and queues were thought of as a necessary evil. But now, customers expect gratification instantly. They want to click and collect. They want retailers they can DM, tweet, comment, snap, and call. And they care a lot more about their shopping experience.
To stay ahead in this competitive industry, it can sometimes feel like you need a crystal ball. How can you possibly predict the trends that are coming up next?
We’ve got you covered. Here are 7 retail trends to watch in 2020 and beyond.
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Shopping is becoming about the experience
Pricing was once one of the biggest brand differentiators, but now it’s fast becoming inconsequential. By 2020, customer experience will have overtaken price as a key brand differentiator, according to a study by Walker.
Paving the way for this new trend are stores like Made.com. Despite the digital connotations in the brand’s name, Made.com has moved into the arena of physical retail and is outshining competitors when it comes to experience.
While performing well online, Made.com saw a need to create physical showrooms so that customers could see their products in the flesh, get real-time advice from shop assistants, and forge a deeper connection with the brand. It worked. And happy customers often share their experiences on Instagram.
But Made.com didn’t stop there. The store delights customers with a quaint cafe and regular workshops, making the experience more than just furniture shopping.
If you don’t have the capacity to do this in your retail store, don’t worry. Even something as little as setting up an Instagram Wall (a decorated background where people can take photos of your products) is a great way to boost customer experience.
A rise in omnichannel messaging
‘Omnichannel messaging’ isn’t a phrase that makes it into everyday conversation, and yet, everyday conversations are facilitated by omnichannel messaging. Customers use multiple touchpoints – like SMS, chat apps, and email – to communicate and they expect a seamless experience across all of these platforms.
To ensure you provide this for your customers there should be clear alignment between your on-floor customer service staff and the multiple touchpoints available to your customers, such as email and phone conversations. If a customer makes a complaint over the phone and then comes into your store, they won’t want to explain their situation again, so alignment between staff is paramount.
Customers want to converse with brands as easily as they chat to their friends and family. For retailers, this means being available on the touchpoints that matter to your customers. Remaining consistent with your brand voice, colours, and offering will further facilitate valuable conversations that could lead to increased sales and brand loyalty.
Omnichannel marketing is bridging the gap between online and offline retail, with 40% of purchases now finalised through multiple channels, according to Apsis.
Larger retailers, like Nike, have already started to implement omnichannel strategies. Nike use signage in their offline stores to promote online-exclusive items, and all of their staff members are equipped with point of sale (POS) systems that allow customers to pay for their items without queuing.
The world is going cashless
Gone are the days of counting out the correct change in a store to try and rid yourself of unwanted coins. No one carries cash anymore. According to a survey by PureProfile, a global research company, 73% of people would leave a store if card payments were not accepted. The same survey revealed that 36% of people would never return to the store.
Retailers of the future will be required to accept all different kinds of payments, from contactless cards to smartphones. And, as indicated by the Nike example above, customers want to be able to pay without queuing. A recent study discovered that queues cost UK retailers £3.4 billion every year. Over 70% of customers agree that the checkout experience is their biggest pain point, citing long lines and lengthy wait times as their main issues.
These pain points can be resolved by equipping floor staff with handy mPOS readers so that customers can pay where they stand. mPOS readers facilitate a faster, more seamless checkout and can also ensure a secure transaction. Plus, you don’t need to be as big as Nike to get started. With SumUp, you can equip your staff with readers for a small one-time fee, with no fixed contract and no fixed costs.
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Brands are more ethical
Earth Day, which started with 2 million Americans in 1970, is now celebrated by over one billion people in 192 countries. Next year will mark Earth Day’s 50th anniversary, so we can predict that 2020 will bring a new wave of customers who are more conscious of how their shopping behaviour impacts the planet.
In some cases, the future is already here. A study by Forrester found that shoppers are increasingly evaluating brands based on their ethics and values. And brands are responding to this.
Cosmetics retailer, Lush, have been known for their ethics and campaigning for a long time. They have recently taken this one step further and started opening package-free stores to reduce plastic usage.
Doing ‘the right thing’ is not only great from an ethics point of view, it’s also more profitable. A Forbes study on the top 100 most ethical companies in America found that they consistently outperform their industry competitors. It appears sharing a value with your customers gives them a better reason to shop with you and also more incentive to spread awareness through word of mouth marketing.
So, if you recycle or source your materials ethically let your customers know about it by putting posters up around your store or including notes at the bottom of your receipts. You could also take it online and post about your efforts on social media. By using popular hashtags, such as #ethical, #sustainable, and #ecofriendly, you can attract customers who feel strongly about those topics.
Augmented reality will enhance experiences
Augmented reality (A/R) is the process of using a smartphone to view computer-generated imagery in the real world. It may sound like something out of Back to the Future, but its uses are quite practical.
A smartphone (or other device) camera shows the customer’s real view and the A/R technology superimposes an image over that. It’s a revolutionary tool that was primarily aimed at the gaming industry. However, retailers have now started using this to enhance the shopping experience for their customers.
The IKEA Place app allows customers to picture exactly how furniture will look in their home before they purchase it.
Another great example of A/R in retail stores is the Lego ‘Digital Box Kiosk’. Customers are invited to scan boxed items so they can see what the figures will look like when assembled.
More than 50% of people are already using their smartphones while shopping, and 33% have used their phone in conjunction with A/R in stores. So it’s clear that this is a trend that is growing in popularity.
Additionally, according to a study by Hacker Noon, 40% of people said they would be willing to pay more for a product if they could first experience it through augmented reality.
Creating an A/R app may seem daunting for an SME, but there are resources out there that can help you get started. Click here for a list of A/R resources for beginners.
Same-day delivery is the new normal
Ever since retail giants like Amazon started offering next day delivery, customer expectations have risen. Amazon can now even deliver some items on the very same day they are ordered. You can see the UK locations where this is available by clicking here.
If one-day delivery wasn’t impressive enough, Amazon is expecting to shrink that time even further with new drone technology. Amazon’s drones will be able to deliver packages weighing 5 lbs or less within just 30 minutes.
Although this sounds terrifying for smaller retailers, it’s actually a positive thing because it means the technology is there. Soon, same-day delivery will be the new normal for all retailers.
Competition between brick-and-mortar retailers and online retailers has been tough in recent years, and offering same-day delivery is a great way to even out the playing field. The first step towards doing this is to find out where your customers live and work, and also to take into consideration where your warehouses and/or fulfilment centres are located.
One retailer already testing the waters is Currys PC World. In partnership with On the Dot (a same-day courier service), the store now offers expedited two-hour delivery slots for £9.95 (at the time of writing).
There is real value in this trend. According to a survey by PwC, 88% of consumers are willing to pay extra for same-day delivery.
An increase in artificial intelligence
You know the future is here when robots start making an appearance. HSBC has started to introduce robots to answer simple customer questions and free up staff to deal with more complex queries.
Additionally, Macy’s has a mobile-powered virtual assistant that helps shoppers find what they’re looking for.
There’s no need to consider replacing your entire workforce with robots. A little A.I. can go a long way. Chatbots, for example, can help to reduce customer service costs by over 30%. And it’s estimated that 80% of brands are either using or thinking about using chatbots in the near future.
A.I. can also help retailers and customers with locating products. According to RetailDive, customers often use their smartphones to enhance their shopping experience, and 58% of the people who do this said that the number one reason is to look up product information. Tools like scannable QR codes on products can make this even easier for customers.
To sum up...
In many ways, the future of retail is already here but these retail trends are the ones to watch for 2020. And there are lots of exciting things you can do to ensure your store stays ahead of the curve in your industry.
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