With e-commerce today, you’re just a click away from ordering anything and receiving it at your doorstep within days –– if not hours. Years ago, this immediacy was considered an emerging trend in retail and e-commerce. Now, it’s simply a standard expectation in the buyer journey.
Retail trends –– which commonly intersect with emerging e-commerce trends –– refer to changes that directly influence how the retail industry operates or transacts. This includes process changes that impact both brick and mortar retail and e-commerce business operations, emerging or advanced technologies that drive efficiency, and improvements that support the consumer experience.
Here, Cin7’s Maylene So, Senior Product Manager in the EDI, 3PL, and e-commerce space, and Francisco Topp, Product Manager, reveal the 18 major retail and e-commerce trends you should expect to see in 2024 and beyond.
Retail trends encompass developments in the retail sector, which includes industry verticals like cosmetics and beauty, food and beverage, and fashion. Emerging retail trends are often responses to larger environmental factors, including:
Given that retail brands generally must incorporate an e-commerce strategy to remain competitive and expand their reach, there is some natural crossover among retail and e-commerce trends. The distinct environments of physical and digital spaces, however, result in unique trends within each sector.
Here, we’ll unpack the leading trends in retail like social responsibility around AI usage, machine learning and personalization at scale, and the need for speedy buying processes where the customer is in control.
AI and intelligent commerce have indisputably revolutionized the retail industry, offering novel avenues to enhance the consumer experience. From optimized pricing, inventory management, and supply chain management to improved search functionality, AI has the potential to improve customer satisfaction and operational efficiency.
Here are a few emerging retail trends in AI:
With increased access to AI tools and integration comes new ethical questions and concerns. While technologies like voice and facial recognition offer innovative solutions for enhancing consumer experiences, not all individuals feel comfortable or adept at using the tools.
Beyond discrimination concerns, the same study revealed that the majority of shoppers felt product recommendations weren’t accurate. This indicates that while AI tools and integration have come a long way in a short time, they remain far from reliable from a social responsibility perspective –– and businesses should bear this in mind.
Through natural language processing (NLP) and advanced machine learning algorithms, AI chatbots and virtual assistants can engage customers in personalized interactions as a method of cross-selling and upselling.
These AI-driven entities can discern nuanced insights to tailor product recommendations that resonate with individual needs and interests by analyzing vast datasets, including:
The dynamic nature of machine learning also enables continuous refining and adaptation of recommendations over time, ensuring relevance and efficiency in optimizing sales opportunities.
From correctly spelling and pronouncing names to offering location-specific discounts, retailers are leveraging customer behavior and preference insights to create a personalized shopping journey.
Personalization is no longer an option but a necessity, with 80% of online purchases coming from product recommendations. A Klarna report also found millennials and Gen Z look forward to AI understanding their distinct preferences so accurately that it can autonomously handle the shopping experience on their behalf, made possible by AI recommendation engines powered by SKU-level data.
An example is Amazon, which uses AI to curate personalized recommendations based on individual purchase history and browsing patterns. Amazon Prime Wardrobe also recently introduced a personal shopping service where Prime members receive customized style recommendations guided by their fit preferences and fashion taste.
An added benefit to businesses: Personalization at scale has been shown to increase sales and lower marketing and sales costs by 10% to 20%.
Consumers now want their orders within hours, not days or weeks. To meet demand, retailers are partnering with e-commerce marketplaces and 3PLs to leverage their infrastructure for quicker delivery.
Two additional methods include BOPIS and “click and collect.” These terms are often used interchangeably, but the retail strategies are technically different:
“With these methods, you don’t need to wander around the store looking for the product and wondering which aisle it’s in anymore,” So explains. “This provides the buyer with more control. When they need the product, they pick it up.”
In fact, 70% of respondents in a recent study by the National Retail Federation said that BOPIS improved their shopping experience. BOPIS or click and collect methods can even increase sales — a report by PYMNTS discovered that 47% of online shoppers end up purchasing additional products when they visit the store to pick up online orders.
In today’s era of heightened consumer expectations, the ability to track packages from the moment it’s ordered to the time it’s delivered is a given. Consumers crave control and transparency when monitoring their orders.
“They want to know where the order is coming from, when it arrives at the airport, when it’s going through customs, and when they need to be home to receive it — all in real time,” So explains.
The repercussions of missed or delayed deliveries are significant, with a report from DispatchTrack indicating that more than half of big deliveries are rescheduled. Additionally, 6 in 10 consumers stated that they’re unlikely to repurchase from a retailer if a previous order missed its scheduled delivery window.
Diversity, equity, inclusion, and belonging (DEIB) are critical pillars in shaping the future of retail, especially as technology advances. Collaboration among industry players to develop plans that prioritize social responsibility in AI solutions is paramount to ensure voice, video, and image search technologies are inclusive and free from biases.
Companies using AI need to ensure that when it comes to human voice, different tones, accents, and languages are accounted for during development.
The business case for DEIB initiatives is compelling, with studies indicating that companies with diverse leadership teams tend to foster higher levels of innovation, leading to higher revenue and profits. Companies in the top quarter for ethnic diversity are 36% more likely to eclipse less inclusive peers.
Further, a recent survey revealed that more than 75% of Gen Z customers will stop shopping with companies that run macho, racist, or homophobic ads.
Additionally, prioritizing online retail accessibility not only ensures compliance with legal standards but also expands reach to customers with disabilities, ultimately enhancing the overall user experience and driving business growth. Product descriptions and website navigation are two main areas businesses should focus on improving to remain competitive in the year ahead.
Prioritizing mobile marketing, accessibility, and payments is crucial now more than ever, as consumers can buy on their mobile devices at any time. Experts predict the ability to order from a smartwatch using your voice isn’t far off, either.
“Mobile is not a trend, but something that is one of the most important –– if not the most important –– sales devices in the world,” Topp explains.
Even if consumers are shopping in-store, they’re still using mobile devices to:
Retailers can utilize push-based apps to provide re-engagement opportunities, like updates on pricing and availability. In-store beacons, which are Bluetooth devices placed throughout a store, can elevate this strategy with notifications whenever the shopper is within range.
The surge in B2B e-commerce marketplace channels, sometimes called the B2B2C model, reflects a shift in how businesses conduct transactions. Gartner predicts that 80% of sales interactions between suppliers and buyers will happen through digital channels by 2025.
Businesses are increasingly more comfortable making substantial deals online through these platforms. Other reasons for this rise in popularity include:
Marketplaces offer businesses unparalleled flexibility, enabling swift responses to market dynamics and facilitating better inventory management with real-time stock visibility and streamlined procurement processes.
On one hand, 75% of B2B buyers prefer a representative-free sales experience. However, there remains a need for a hybrid omnichannel approach, as the same report demonstrated that 43% of buyers are more likely to regret digital self-service purchases.
Referred to as the generational consumer powerhouse, Gen Alpha –– anyone born between 2010 and 2025 –– already holds significant sway over household spending decisions.
Gen Alphas have already formed strong brand preferences and are ready to purchase in accordance with them, as demonstrated by their well-documented skincare and beauty brand obsession.
A McKinsey report recommends retailers view Gen Z consumption from the following perspective: “Consumption as access rather than possession, consumption as an expression of individual identity, and consumption as a matter of prosperity and focus on the self.”
Going beyond sustainable packaging, 2024 will see a trend of sustainable services powered by sustainable energy, like solar farms. For example, Microsoft is using renewable energy to power its new data centers.
According to Deloitte’s 2023 CxO Sustainability Report, 73% of consumer industry CXOs have already increased sustainability investments in the last year due to increasing pressure from stakeholders, board members, regulators, and customers.
Sustainability will only continue to become a more important purchasing factor, as 40% of consumers plan to spend more on sustainable brands over the next three years. To prepare, retailers should examine the gap between their current practices and evolving expectations to identify priority action areas.
The e-commerce industry rapidly evolves year over year, and 2024 is no exception. From the increasing demand for real-time tracking to the adoption of drone delivery, the industry is undergoing significant transformation.
Brands are under pressure to innovate and accelerate product lifecycles, while also meeting consumer expectations for quick and seamless delivery. Adaptation and embracing emerging technologies are crucial for staying competitive in the rapidly evolving market.
Here are the biggest trends we identified.
In today’s e-commerce landscape, buyers expect seamless access to tracking and product support throughout the fulfillment process, reflecting a shift toward greater transparency and efficiency in inventory management.
Providing the right support and tracking information is paramount to ensuring buyers remain informed about the status of their orders at every stage of fulfillment. This requires optimizing capacity and leveraging automation technology to streamline the process and meet delivery timelines.
“It’s all about how you can minimize expenses and optimize the time to deliver,” Topp explained. “There’s a lot of push in how you can distribute your product faster and more accurately by having the right order tracking information so you can track exactly where your order is and at the same time, the customer is also aware of where the parcel is.”
Order tracking software can help with this effort, creating the following process:
Brands are under pressure to find ways to accelerate the product lifecycle to keep up with evolving consumer demands. On the service side, on-time, quick, and cheap delivery is the expectation.
As supply chains adapt to shorter product lifecycles, brands must swiftly launch new products or adapt existing ones to stay relevant. Technology plays a pivotal role in enabling brands to innovate and expedite product development, leading to a proliferation of SKUs in the marketplace.
Topp explained there’s a big push for sellers to bring in new technology like automation as much as possible to help speed up processes and cut costs, “We can see drone delivery from the delivery side, but also from the fulfillment side, having more robots within your warehouse allows less touch on your product from the moment the order is created to the moment you deliver. The less touch, the more cost-efficient it will be.”
For brands reliant on traditional print methods for packaging, speed poses a significant challenge. However, digital print solutions can facilitate print-on-demand capabilities. This allows for dynamic on-pack messaging adjustments throughout the product lifecycle based on real-time sales data and consumer trends.
Drone delivery is a supply chain trend with the potential to revolutionize the logistics industry. With new FAA regulations facilitating the integration of autonomous drones into national airspace, commercial drone delivery is poised to become scalable and affordable.
One of the key benefits lies in its ability to reach remote or rural areas that are otherwise challenging to access via traditional delivery methods. It also offers cost-efficiency advantages by eliminating the need for human drivers and reducing fuel consumption.
In comparison to traditional truck delivery, electric drones reduce:
However, the widespread adoption of drone delivery poses challenges like privacy concerns related to GPS tracking and cameras, as well as security risks associated with hacking and unauthorized use.
Despite these challenges, major corporations like Amazon have already incorporated drone delivery, and it’s likely to become a mainstream method of transportation.
The rapid advancement of AI and increased data collection practices has heightened the urgency for robust data security measures in e-commerce. For instance, the proliferation of AI has led to an increase in impersonation and the emergence of imposter accounts, posing significant challenges to data security.
Plus, with the e-commerce industry experiencing about 32% of all cyberattacks, protecting personally identifiable information (PII) has become more important than ever.
To remain competitive, businesses need to adopt strict data collection practices, ensuring they only collect the most essential information to mitigate the risks associated with data breaches and safeguard customer trust.
Social media is widely recognized as a sales and marketing tool, but with over 26% of social media users looking to their favorite platforms to find products, it’s more important than ever to know how to interact with users on social media.
Social commerce in the U.S. is projected to reach nearly $80 billion by 2025. Platforms like Facebook Shops, Instagram Shop, Pinterest product Pins, and TikTok Shop enable one-click checkouts — crucial for taking advantage of this surge and targeting Gen Z and Gen Alpha audiences.
TikTok specifically has witnessed significant growth, as it provides an authentic and unfiltered environment where user-generated content and spontaneous sales messages feel more like trustworthy recommendations from friends.
Social media users are more likely to purchase products based on reviews from creators they trust but be warned that poor reviews from popular creators can quickly decrease sales as well.
Gamification has the ability to improve customer engagement, conversion rates, and customer loyalty. It operates on the principle of intrinsic motivation, where customers engage with the platform not solely for external rewards but also because they find the experience inherently enjoyable.
For example, the Nike+ running app gamifies the running experience by providing real-time feedback and rewards, motivating users to achieve goals and strengthening their bond with the Nike brand.
Emerging trends in e-commerce gamification include:
Inventory efficiency is needed so that the seller can spend less time managing and more time selling. If you’re still not convinced, research correlates good inventory efficiency with higher business performance.
What this looks like in 2024 is a seamless workflow between parties, so it’s easier than ever for partners to function. It also means better warehouse inventory management, ensuring you’re calculating the right stock at the right time, which may require sellers to change the way they operate.
New opportunities like partnering with Amazon for multi-channel delivery means cheaper, faster delivery. Connected inventory performance reporting is also on the rise, as it allows a 360-degree view into operations so sellers can focus on other parts of the business.
With access to the latest retail trends, adjust your business strategy accordingly and reap the benefits. As the volume of your e-commerce transactions increases, it’s crucial to efficiently manage your inventory and deliver on time — two factors that can severely impact your reputation.
As a savvy business owner, you should use inventory management software to get real-time visibility of your inventory and on-time stock replenishment. By integrating this software with your e-commerce strategy, you can also gain valuable insights into your store’s performance and metrics.
Request a demo to see how we can help scale your business.
New trends in retail include social responsibility around AI, AR, and machine learning, increased personalization, control around the checkout and delivery process, mobile device initiatives, B2B selling, catering to Gen Z and Gen Alpha audiences, and a focus on sustainable services.
The megatrends in retail surround AI, AR, machine learning, and the responsibility companies must take to ensure alignment with DEIB practices.
Additionally, adjusting strategies for Gen Z and Gen Alpha audiences will have a lasting impact.
You can identify trends in the retail industry through a combination of market research, data analysis, and observation of consumer behavior. This involves monitoring sales data, tracking shifts in consumer preferences, and speaking with subject matter experts.
No, omnichannel isn’t a new e-commerce trend, but it’s still a relevant strategy, especially for B2B brands. While B2B moves into the e-commerce space, research shows that customers regret fully self-service purchases, so a hybrid approach is still needed.
The major trends in e-commerce are expedient fulfillment, increased tracking, drone delivery, data security, meeting shoppers on social media platforms, gamification, and inventory efficiency.
