Two-thirds of Gen Z (aged 18-24) prefer second-hand products to new products. (Various)
44% of consumers say that they are buying more second-hand items than they did a year ago. (Barclays)
Second-hand sales contribute £6.99 billion to the UK economy each year. (Barclays)
The United Kingdom's interest in second-hand items is increasing, propelled by the rising cost of living and a shift towards more sustainable shopping and lifestyle choices.
The circular economy is anticipated to keep growing, prompting retailers to explore viable entry points into the market as a strategy to diversify their revenue streams.
Renting, reusing and reselling
Barclays define the ‘ReCommerce Economy’ as “the actions of renting, reusing and reselling consumer goods and products rather than buying new. It takes place through physical or online distribution channels.
Those processes are defined as follows:
Renting (hiring items instead of purchasing new)
Reusing (buying second-hand items)
Reselling (selling used items rather than discarding)”
This presents an exciting opportunity for UK retailers, who may consider adapting to provide consumers with more sustainable and altogether affordable ways to shop in the future.
Nike Refurbished launched in 2021, sourcing a mix of returns and open-box products, providing the consumer with an opportunity to purchase ‘gently used’ footwear. Selfridges Rental launched in the same year. Among many brands to join them in recent times is Oh Polly who just announced their dress rental service this week.
Sustainability and reusability are on the agenda of the major players and it could pay to be on yours, too.
Affordable sustainability will drive conversions
Approximately 55% of consumers in the UK would be more willing to adopt a sustainable lifestyle if it were more affordable. (Statista)
58% of retail customers are willing to pay the extra cost of purchasing an eco-friendly product. (GWI)
Two-thirds of Gen Z shoppers stated they are likely to buy products from a brand that has strong ethical and sustainable credentials. (Statista)
Consumers will only choose eco-friendly options if they can afford to do so, and given the decline in discretionary spending, justifying these choices is becoming more challenging, even with the best of intentions.
Retailers that can offer affordable and transparent sustainable choices will stand out through robust market differentiation.
Valued sustainability USPs
According to Deloitte’s research, in the past 12 months, there has been an increase in the proportion of consumers saying they have adopted a more sustainable lifestyle. They tracked 23 ‘sustainable behaviours’ and found an increased adoption of 11 of them.
One such behaviour is paying more for longer-lasting products, taking into consideration durability and repairability when making a purchase. This offers a differentiation point if the retailer can compete on product longevity.
The research also puts forward that sustainable packaging and reducing waste are the two practices that consumers value the most. Over one-third of fashion shoppers expect carbon-friendly delivery of their online clothing orders, and it will pay to align with these values.
Providing a phygital retail experience
76% of customers still desire in-store experiences. (Forrester)
3D product visualisation improves conversions by 94%. (Sayduck)
54% of consumers say they would like to readily view information about a product after scanning it with their phone camera. (Deloitte)
Phygital retail is a portmanteau of 'physical' and 'digital,' symbolising the convergence of traditional brick-and-mortar stores with the ever-expanding developments in eCommerce and technology.
Click-and-collect, direct-to-store delivery, and buy-online-return-in-store (BORIS) have all rapidly become non-negotiables in connecting online and offline customer experiences. The leading retail experiences will go beyond that, leveraging the best of both physical and digital retail to keep consumers engaged.
What does the consumer want?
For a long time, there was a notion that a consumer is singularly traditional or online in how they choose to shop.
However, the reality is that they are seeking a blend of the best elements of both, combining the ease and convenience of online shopping with the immersive experience of visiting a store.
This makes sense, the physical and digital worlds are becoming intertwined - and the challenge for retailers is to deliver an experience that is consistent and connected.
We’re predicting that retailers will continue to blend the online and offline worlds through the use of augmented reality, virtual reality, and interactive 3D displays.
For instance, augmented reality is already being used to simulate the in-store experience by providing an accurate and immersive view of a product before making a purchase. Here, a traditional in-store experience is transformed into a digital format for the user.
Conversely, pure online retailers are increasingly launching pop-up shops, with Gymshark even opening a permanent flagship store in London in 2022. They emphasised that the move “isn't just about IRL retail shopping, it's about experiential spaces that bring the conditioning community closer together - from special events and community hangouts to workout spaces and more.”
These developments cater to the evolving preferences of the modern shopper, enhancing their engagement by providing a multi-dimensional shopping experience. They also underscore the need for inventory, order, and customer management systems that enable customers to seamlessly transition between digital platforms and physical stores without disruptions.
Serve customers through social
More than 80% of consumers are now using social media to engage with brands. (Invesp)
76% of consumers expect a reply on social media within 24 hours. (Sprout Social)
Around one in five Gen Z, Millennial, and Gen X social media users have contacted a brand through DMs for customer service. (Hubspot)
We believe that younger consumers will continue to use social media direct messaging for customer service requests and product information queries. This behaviour is second nature to them, as they already use apps like Messenger, Snapchat, Instagram, and WhatsApp to communicate with friends and family.
Regardless of age, consumers prioritise convenience. If they discover your product through social media, they are likely to contact you using that platform's messaging function.
The act of sending an email or picking up the phone may feel somewhat alien to them. The surge in social commerce intensifies the expectation for brands to maintain an always-on presence across all their digital platforms.
Managing your social media messages
Individuals struggling to effectively monitor their social media platforms can take comfort in the availability of numerous management tools at relatively modest costs. Platforms such as Buffer, Falcon, and Hootsuite enable users to connect their social media accounts, consolidating direct message management into one central control point.
It is prudent to carefully consider who is responsible for responding to social media queries. While such responsibilities often fall on the marketing team, given that social media accounts are their responsibility, they may not necessarily be the most adept at addressing customer support inquiries.
Certain social media platforms offer the option to set up automated responses for direct messages. While these can guide customers to the preferred support channel, it's important to note that this approach may lead to frustration, as customers might end up duplicating their support requests.
The age of hyper-personalisation
83% of marketers say their current personalisation efforts heavily rely on assumptions about customers, rather than high-quality insights. (Optimizely)
51% of UK consumers say that the targeted content they receive online is often “boring” or “unhelpful.” (Optimizely)
70% of consumers feel frustrated that the promotions they receive are not directly relevant to their interests. (Optimizely)
Personalisation has been a focus for retailers for a long time, aiming to customise the customer experience to their preferences, building loyalty and encouraging repeat business. It all began with simple ideas like adding names to email marketing and has developed over time.
However, there's a challenge as consumers are becoming more aware of these efforts, and basic personalisation methods are quickly becoming uninteresting. Moreover, they are often carried out based on assumptions about what the customer wants, rather than making informed decisions based on data.
Artificial intelligence is set to revitalise personalisation by using data and technology to automate the customisation of content, products, and services for individual users at a very granular level, elevating customer experience and service standards to new heights.
How does hyper-personalisation work?
Hyper-personalisation heavily relies on consentfully gathering and analysing large amounts of data about individual users. This data may involve browsing habits, purchase history, social media interactions, location and more.
Sophisticated algorithms process and interpret this gathered data, recognising patterns, preferences, and trends. This allows for more accurate predictions about user behaviour, which can be used to automate a more detailed personalisation process.
For instance, an eCommerce website could serve dynamic content that adjusts based on the individual user’s behaviour and preferences. This could include personalised product recommendations, custom marketing messages, and even entire website layouts tailored using algorithms to arrange product listings.
However, a drawback is that these algorithms are only as effective as the data they are learning from.
Right now, the technology may not be fully optimised for websites with lower traffic or users who infrequently visit the site. Nevertheless, as it continues to evolve, we anticipate exciting developments in this field.
Experiential marketing is the winning tactic
85% of consumers are more likely to purchase after participating in experiential marketing events. (Zipdo)
64% of B2C brands say that event attendance has returned to pre-COVID levels. (EventMarketer)
50% to 80% of word-of-mouth activity in any given product category is the result of a consumer’s direct experience with a product or service. (McKinsey)
In retail, experiential marketing is a marketing strategy that focuses on creating memorable and immersive experiences for consumers. The goal is to engage customers on a deeper level by appealing to their senses, emotions, and aspirations, rather than simply promoting products or services.
What makes experiential marketing effective?
Experiential marketing differs from conventional approaches by not exclusively focusing on product sales; instead, its primary objective is to foster a positive brand sentiment.
This strategy enables businesses to forge more profound connections with consumers, fostering a sense of inclusion in a broader narrative or purpose. This is particularly important as consumers are becoming more sceptical and aware of traditional and digital marketing tactics.
For example, the aforementioned pop-up shops could include fun product demonstrations where consumers have the opportunity to observe or actively participate, all without the sense of being subjected to a sales pitch.
It’s a tried and tested marketing strategy that can be dated back nearly 150 years to the Chicago World’s Fair, where William Wrigley J handed out pieces of Juicy Fruit Chewing Gum.
The aim is to build a strong and positive connection between the brand and the consumer by telling a story or conveying a specific message tied to the product’s unique selling points. This narrative helps consumers connect with the brand and products on a more emotional level.
An increasingly shapeless festive period
In 2022, 44% of consumers started their Christmas shopping earlier than September. (Mintel)
This year, 49% of corporate retailers opted to display festive-themed goods earlier in the year, with some even displaying goods as early as June. (Barclays)
6.49% of consumers spread the cost and shop for Christmas throughout the year. (Create Gift Love)
According to Barclays, a unique shopping trend is emerging, reshaping the traditional festive season into a more elongated and flexible experience. Consumers are opting for a more gradual approach, spreading their holiday shopping over an extended period to alleviate financial strain.
For retailers, this shift brings forth a set of challenges that demand strategic solutions.
Preparing for next year’s Christmas period
Managing stock over an extended timeframe could become crucial, requiring a delicate balance to avoid overstocking for Christmas while ensuring popular items remain available.
Timing deals and promotions strategically will also become even more of a priority, with a keen eye on competitors' early moves. The key lies in reaching and engaging customers effectively, creating awareness around Christmas offers to capture attention amid the noise of an extended shopping season.
Retailers must also remain prepared for panic sales closer to the big day, addressing customer urgency by offering convenient solutions like click-and-collect and rapid delivery.
By adapting to this evolving consumer behaviour, businesses can navigate the shapeless nature of Christmas 2024, ensuring a seamless and successful shopping experience no matter the time of year.
Don’t forget about cryptocurrency payments
Cryptocurrency payments are forecast to grow at a CAGR of nearly 17% between 2022 and 2029. (Statista)
The cryptocurrency market stabilised and showed signs of growth this year with market capitalisation rising by 74.10%. (Statista)
Microsoft, AMC Theatres and US mobile provider AT&T are all now accepting cryptocurrency as a form of payment. (Bankrate)
Do you recall crypto? You could be forgiven for overlooking its existence over the past year or so. The market plummeted by an estimated $2 trillion after U.S. President Joe Biden signed Executive Order 14067, 'Ensuring Responsible Development of Digital Assets,' in 2022.
As the market recovers, it’s worth underscoring this positive momentum in our trends to watch for 2024. It serves as a timely reminder that cryptocurrency continues to be a significant player worthy of your attention.
How do cryptocurrency payments work?
Cryptocurrency payments typically involve the use of a cryptocurrency payment gateway—a service that facilitates the acceptance of digital currencies for transactions. The website's checkout process would be integrated with a gateway like BitPay, CoinGate, and Coinbase Commerce.
These payment gateways are connected to the user's cryptocurrency wallet, used to store their digital currency. It's not too dissimilar to paying with traditional currency held in one’s PayPal wallet.
While there is no immediate action required for retailers in this space, it is worth keeping an eye on. If the market continues to strengthen, there may be more appetite to purchase using digital currencies, especially in retail industries with interest crossovers, such as technology, gaming, virtual goods, and high-end retail.
It pays to humanise your brand
60% of consumers believe trustworthiness and transparency are the most important traits of a brand. (Statista)
77% of consumers buy from brands that share the same values as them. (Havas Group)
70% of consumers feel more connected to brands with leaders that are active on social media. (Sprout Social)
Competing solely on price won't suffice in 2024. Connection is the currency of the moment, and consumers, now more than ever, seek brand humanity and trust when exploring products.
This means dismantling barriers and inviting potential customers into the inner workings of the business – showcasing its people, culture, and values. While often considered an age-old truth reserved for B2B marketing, it unquestionably applies to B2C retail.
As consumers become more conscious and aware of the businesses they buy from, retailers must begin to go beyond product USPs and let the audience get to know them in a deeper sense.
Leading humanisation techniques
It doesn’t take an expensive branding overhaul to start fostering humanisation into a marketing strategy–but that should be considered by retailers who do not have a clear understanding of their mission and values.
For those who do have that sussed, here are some go-to techniques that businesses of all sizes and sectors are using to humanise their brand:
Storytelling: Sharing the story behind the brand, including its origin, challenges overcome, and milestones achieved.
Employee Spotlights: Introduce the faces behind the brand. Featuring team members, their roles, and even their interests outside of work
User-Generated Content: Encouraging customers to share their experiences with the product and service, demonstrating the real impact the brand has on people's lives.
Behind-the-Scenes Content: Providing a glimpse into daily operations, whether it's the manufacturing process, office culture, or how products are developed.
Values and Mission Communication: Clearly articulate the brand's values and mission.
Interactive Social Media: Engage with audiences on social media platforms by responding to comments, asking questions, and participating in conversations.
Accessible Leadership: If applicable, make leadership figures within the business accessible. This could involve CEO interviews, blog posts, or participation in online discussions.
To some extent, it’s time to start selling the business before the products.
66% of 4-16-year-olds plan to buy from brands that have a positive impact on the world. (Wunderman Thompson)
Almost a third of global teens have access to a bank account. (GWI)
Generation Alpha (born 2010-2025) represent the first generation to be entirely born and raised in the 21st century. A digital-first generation, they are poised to have the greatest spending power in history.
With the eldest in this generation bracket entering adolescence, it is now the time for retailers to begin gaining insights into their evolving preferences, behaviours, and expectations, adapting strategies for long-term success.
This is particularly crucial for those in the technology, fashion, gaming, health, entertainment, beauty, and electronics sectors.
What do we know about tomorrow’s consumers?
The leading report comes from GWI and is free to download.
It discusses that Gen Alphas are what researchers call "upagers," signifying that they are more socially aware at a younger age and become consumers more rapidly. This generation is expected to be the most diverse in history, bringing with it very high standards of exclusivity and representation in brands’ marketing content and business practices.
TikTok is influencing Gen Alpha's content expectations. This generation is likely to place greater importance on the creative and audio aspects of marketing campaigns.
With ready access to information through the internet, Gen Alphas may mature into highly conscious consumers. Alphas are unlikely to view the things they buy as simple commodities; to the earlier point on brand humanisation, the feeling is that this generation will want to know the stories behind their purchases and engage with brands on a deeper level.
These young individuals, progressively gaining purchasing power and shaping social media trends, are poised to become a driving force in shaping the future of consumer preferences and market dynamics.
So there we have our ten trends for the year to come. We hope that this review has presented you with some fresh, pertinent subjects that may not have crossed your minds before.
If you’re looking to start a new project in 2024, why not get in touch with our team for more information on how we can help you.
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