Ready, Set—Retail

Retailers everywhere—whether online, brick-and-mortar stores, or both—are winding down from the holiday shopping season of 2023. The results of last year’s sales proved to be surprising—and encouraging. Additionally, these results should serve as guideposts on how to plan for 2024.

A turnaround

One positive outcome worthy of sitting up and taking notice of was the percentage of purchases made during last year’s holiday rush. Originally, the predictions were discouraging, with sales growth estimated to fall by 3 percent in comparison to 2022. For retailers that operated online, there was a literal reversal of fortune.

On the mark for online shopping

Happily, according to findings from Adobe Analytics that were detailed in Investopedia, customers who did most—if not all—of their holiday shopping online spent a grand total of $222.1 billion, which proved to be an increase of 4.9 percent over last year’s sales. Factors that contributed to this bonanza included:

  • Many “buy now, pay later” options offered by online retailers.
  • A very healthy Cyber Week turnout.
  • An increase in purchases made via mobile device. While widespread use of smartphones and tablets for making purchases is nothing new, 2023 proved to be a watershed year, as many more users accessed these devices to shop—accounting for 51 percent of sales.

So, this summarizes the past—and potential—success of online retail. What about brick-and-mortar establishments?

How strong is the standing for store structures?

Depending on merchandise or specialty, success for brick-and-mortar stores varied during the course of 2023. A recent article in Fortune noted that during the holiday shopping season:

  • Sales of furniture increased by 0.9 percent.
  • Clothing and accessories followed at a 0.6 percent increase.
  • Electronics and appliances decreased by 1.1 percent.
  • Department stores saw a drop of 2.5 percent.

In comparison to online retail, results for in-store sales either increased slightly or fell noticeably. Despite this unevenness, the Forbes article pointed out that approximately 40 percent of retail traffic takes place during the holiday shopping season—which still accounts for a sizable number of sales.

Translation: Brick-and-mortar stores are still in the game, and and remain relevant.

The future direction for brick-and-mortar stores

One advantage that a physical store space has over its online counterpart is human interaction. There is a growing preference among customers for a more personalized shopping experience, and as pointed out in Retail Minded, many brands are investing more of their budgets into retail locations. Aside from wanting a person-to-person shopping experience, many customers want the option to visit, hold and examine a piece of merchandise—and then make the choice as to whether or not to make a purchase.

The marriage of digital and in-store shopping

A report from Insider Intelligence/eMarketer stated that in addition to assistance from their related online counterparts, where customers may order online and pick up their merchandise in a nearby location, many retailers will seek added visibility through creator collaborators—especially from TikTok—to promote the appeal of shopping in brick-and-mortar stores. Then, there is a future development, courtesy of artificial intelligence (AI)…

The influence of AI on the retail landscape

The application of AI to the in-store experience may well take autonomous shopping to new levels, or, as TechRadar Pro states—”a retail revolution.” Customers will be accommodated and retailers will be able to analyze in-store data and get the information they need to offer everything from dynamic pricing to real-time promotions.

Questions to consider

If you are a merchant and operate from either a brick-and-mortar store or via an eCommerce site (or both), here are questions to consider:

  • Does your store have a customer (a.k.a. rewards) program?
  • How strong is your store’s mobile presence?
  • Are there any extra special deals you can offer for any notable holidays? (This does not include only Black Friday and Cyber Monday followed by the rest of the holiday shopping season. Consider Martin Luther King Jr. Day, Presidents Day, and Fourth of July.)
  • Are your online and brick-and-mortar presences in sync to deliver as seamless a customer service as possible?
  • Does your store have a social media presence?
  • Are you keeping up with the latest trends in technology, such as AI, to help bolster your store?

If you answered “yes” to any or all of these questions, maintain and intensify these tasks through 2024. If you find that you are falling short in any of these areas, get in touch with EGC. We will help craft strategies that will give your customers wonderful shopping experiences and add visibility to your retail presence.