Come 2022, the retail landscape may look remarkably different – 2019 was worlds apart from our standing in 2020, and again this year we have been faced with new, unique challenges. In a recent B2B survey for online retailers in the UK conducted by Scurri and CensusWide, the results showed cautious optimism amongst retailers surveyed – 86% of online retailers state they are concerned over labour shortage and supply chain issues affecting them beyond early 2022, however 84% also said they were optimistic about what lies ahead in 2022. What can we expect to see this coming year and what lessons have we learnt that we can use moving forward?
What will the retail landscape bring?
Convenience will be king, as we have seen over the course of the pandemic and as customer needs shift. While the demand for online shopping soared with physical store closures, since the reopening of the high street in April 2021, we have seen a gradual decline in online retail revenue month on month. Delivery staff shortages and other wider supply chain issues may have had an impact on this, and these issues do not look to be ceasing in the early months of next year. Coming into 2022 it is important for both channels to realize that the wants and expectations of the consumer are now for products at their fingertips, with services to match. This extends to the post-purchase process, where retailers should seek out delivery partners that offer a wide range of shipment and delivery choices for the consumer, illustrating how they know that there is no longer a ‘one size fits all’ approach in modern commerce and moving into that future.
Multichannel retail experiences may be the way forward and answer to the question of comprehensive customer convenience. But more than just the multichannel approach it is the one step further that will set retailers apart from one another – the creation of a connected ecosystem of all provided services that allows customers to interact through a fully rounded experience. The adoption of this business model is the clearest way to say to your customer that you are listening, you hear them and you can provide them with, not just one, but all their needs under one roof.
We can also expect to see a continuation of growth in M&As in online retail in the next year. We have seen this over the last 18 months and the trend is only increasing. This shift is a result of more than COVID-19, though maybe it is rooted in it. Consumer preferences and attitudes are continuously shifting, and as more and more customers have moved to the online marketplace, investors have had no choice but to notice this. The retail environment is never stagnant and we are all stakeholders in this – it would be a disservice for investors not to make this switch accordingly.
As a result of the issues and changes this past retail year, many retailers have altered their key growth markets moving forward. Scurri’s survey found that 88% of the surveyed retailers had made a change to their key growth markets, with the most popular areas now being Germany (38%), followed by France (30%), Belgium (29%), The Netherlands (28%) and Ireland (27%). For those retailers who did not alter their key markets, the most popular regions that they continue to focus on are much the same as retailers who refocused, including Germany (33%), Switzerland (33%), The Netherlands (29%), France (29%) and Ireland (26%).
In addition to changing markets, priorities for the retailer have changed for 2022 and beyond. Results by Scurri found that 46% of online retailers said advancing their sustainability agenda to reduce impact on the planet is their priority. The majority of British consumers pay attention to the sustainability and environmental efforts of retail brands, with customers searching for more sustainable retail brands online. Other top priorities include investing in digital retail technology (46%), cross border expansion (44%), Covid-19 recovery and return to pre-covid levels of business (42%), as well as winning new business (41%).
Technology will have an increasing and evolving role in the coming year in the retail space. In particular, we can expect to see a surge in the use of AI for online shopping experiences. We have already seen the use of AI chatbots to aid customer service, and the improvements are coming at a rapid pace. AI has additionally been used to enable personalised online experiences, through the virtual visualisation of products, particularly in the fashion and clothing sector. With retailers seeing the use of AI and the ease this provides customers, it is fair to expect an increased uptake as well as additional uses being made using the same technology.
Looking to the future, perhaps the most important lesson we have learnt over the last few years is to be prepared on all levels. All aspects of the purchase and sale process should be examined, with viable back-up strategies in place. In advance of issues arising, online retailers should have dedicated time and resources to ensuring the shipment and delivery partnerships selected can manage their needs. All necessary equipment should be available in excess, including labour. At a time where the retail scene has proven itself to be ever evolving, the only constant should be preparation.
Fergal O’Carroll is the chief revenue officer at delivery management company, Scurri, with responsibility for sales strategy and execution.
His prior roles include EMEA vice-president for commercial sales with Teradata for eight years; prior to that, he was managing director of business intelligence solutions with Avnet Client Solutions for 13 years.
Fergal holds a BA in Business Studies from the University of West London and is a native of Dublin, Ireland.
