It might not look a lot like Christmas right now, but the holiday shopping season is right around the corner.
According to the National Retail Federation, this high-spending shopping stretch from Thanksgiving through New Year’s is responsible for nearly one-fifth of total annual retail sales. In a highly competitive sector where consumers are expected to spend $7.5 billion in 2024, it’s an opportunity that retailers can’t afford to miss.
In addition to brick-and-mortar retailers, sellers compete with an expansive ecosystem of more than 26 million e-commerce sites, competitive pricing dynamics, and erratic market conditions.
With customers expecting everything, everywhere, whenever they want it, omnichannel retail is the only way to outpace the competition.
One consumer survey found that nearly three-quarters of customers expect to do anything online that they can do in person. A separate analysis found that the average buyer turns to nine channels to make purchases, highlighting the need for seamless, omnichannel experiences that meet consumers wherever and whenever they shop.
A well-executed omnichannel shopping experience is the key to staying ahead. These four trends will influence how you strategize and succeed in the upcoming holiday season.
#1 Generative AI
Generative AI (Gen AI), the seemingly ubiquitous technology that can create text and images, conduct complex simulations, and interact with customers, could have enormous implications for the retail experience in 2024.
One consumer survey found that 72 percent of consumers expect their online shopping experience to evolve with Gen AI, including integrating or amplifying pre-purchase product education and virtual shopping assistance.
In response, 64 percent of retailers say they have conducted Gen AI pilot programs, believing “the technology holds great promise for reigniting growth.” Retailers are using this technology to:
- Generate personalized responses for customer service agents
- Create a conversational digital shopping assistant
- Create personalized promotions for loyalty members
- Produce creative assets for ads, emails, social media accounts, and websites
- Enhance demand forecasting, allocation, and replenishment.
To be sure, Gen AI isn’t a silver bullet for achieving customer satisfaction. More than 90 percent of those consumers surveyed had high expectations for brands’ use of Gen AI, while just 54 percent were willing to share personal information to enhance their shopping experience.
This means that brands must look beyond the hype to invest in, develop, and implement Gen AI solutions that make the most impact on the buyer experience and bottom-line outcomes.
#2 Data Harmonization
Retailers are awash in data. Doing something with it is much more difficult.
According to one study, just 24 percent of executives say they successfully created a data-driven organization, an eight percent decline since 2019.
Similarly, Forbes reports that “91% of business leaders say the growing volume of data has limited the success of their organizations.” At the same time, nearly three-quarters acknowledge that data volume has eroded trust in data as a decision-making tool.
Investing in a data warehouse and a handful of dashboards could be eye-opening for any growing business, providing the insights needed to create a truly personalized and seamless omnichannel shopping experience.
#3 Post Purchase Communication
The checkout counter or purchase screen can’t be the last intentional interaction with your customers.
They must continue to engage their customers after they complete a purchase, providing personalized post-purchase communications, including:
- Gratitude for choosing their platform to make a purchase
- Opportunities for customer feedback
- Methods for receiving support
- Regular updates on order and delivery status.
Regardless of the touchpoint, post-purchase communication should be strategic, compelling, and customer-focused so shoppers continue to feel valued and connected to the brand.
#4 Returns & Repurposing Inventory
Returns are an enormous problem for retailers.
Forbes reports that 20 percent of online orders are returned, costing retailers $642 billion annually. A similar amount of in-store purchases are eventually returned.
There are many reasons for this problem, but it has become so pernicious that nearly 60 percent of retailers reported “keep it” policies, preferring customers just keep their unwanted merchandise rather than navigating the cost and logistical nightmare of reclaiming unwarranted inventory.
This year, retailers must update their policies and procedures to reverse this trend.
They are in good company. Today, more than 40 percent of retailers charge return fees, while others offer free returns in exchange for signing up for loyalty or other incentive programs.
As one Atlantic headline recently declared, “The free-returns party is over.”
Even Amazon, which started & proliferated the free returns movement, is charging to return some items.
More stringent return policies don’t have to erode customer experience. When these policies are proactively communicated, compassionately enforced, and balanced with added value like exclusive discounts or loyalty perks, they can enhance customer satisfaction while reducing return rates.
Remaining Relevant In Retail
Brands looking to capitalize on consumers’ willingness to spend this holiday season must provide a compelling omnichannel retail experience.
Understanding the latest trends is the right place to start.
Embrace the power of new technologies, like Gen AI, harness insights from harmonized data, maintain thoughtful post-purchase communication, and update return policies before shoppers visit your website or walk into your store.
In doing so, you convert trends into best practices for delivering the omnichannel shopping experience consumers covet.
