Consumer Behavior

A look at retail's top 7 trends

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June 23, 2020

E-commerce, convenience and a changing brick-and-mortar shopping environment are among the top seven trends in retail today, according to a Deloitte report, "The future is coming…but still one day at a time."

The report highlights four disruptive forces (consumer preferences, technology advancement, economic pressures and market forces) that are driving the top seven trends. In the realm of online shopping e-commerce year-over-year growth was up 68% as of April and more than half of consumers are willing to spend more to get what they need, according to a press release on the research.

In addition, shoppers are spending more on hygiene, sustainable products and organic sales in recent months, with income disparity likely to continue to play a key role in the growth of these categories.

"Moving forward in the COVID-19 environment, retail and consumer products companies should be vigilant to identify and react to the emerging disruptive forces and trends at play in the industry. As the saying goes, 'Think globally, act locally.' This can also be applied to retail, meaning retailers should be dramatically more granular in their understanding and operations. While it may be tempting to prioritize game-changing technologies, the data tells us the consumer economics of convenience and cost are more important than ever," said Bobby Stephens, principal, retail and consumer products, Deloitte Consulting LLP, in the release.

In regard to the changing role of brick-and-mortar store environment the ongoing COVID-19 pandemic demonstrated the importance of the physical store for brands and retailers. The closures brought significant revenue loss between end of March and mid May.

"The dramatic shift to e-commerce has also hastened the redefined role of the physical store, and many retailers have reimagined their stores to serve as order fulfilment centers to meet digital demand and drive last-mile execution. But, it is not yet clear whether this acceleration will be sustained by consumers maintaining digital shopping behaviors or the sector will see a normalization to pre-COVID trends as restrictions are lifted and stores reopen," stated the release.

With the closure of "non-essential" physical retail locations due to COVID-19, consumers shifted spending to select physical and e-commerce retailers that could provide essential goods and meet their convenience needs, according to the release.

"As the wallet of many consumers is increasingly pressured due to the COVID-19 pandemic, retail and consumer products companies should recognize they are competing for share of wallet, not share of category. As always, preparation is key. Rather than relying on prophecy-based predictions, retailers should embrace data-driven scenario planning, and remain vigilant in monitoring emerging trends," said Kasey Lobaugh, chief innovation officer, retail and distribution, Deloitte Consulting LLP, in the release.