Predictions of how the retail industry will evolve in 2023
By Brittney Sherman
The only true constant in retail, is change. Never has that statement been truer than in the past three years. For years Susan Reda, National Retail Federation Vice President of Education Strategy, has been publishing an annual retail prediction report. Here is what she predicts will be in store for the retail industry in 2023:
-The metaverse blends the physical and virtual worlds via virtual reality headsets. The tech is there but the consumer comfort level is lagging years behind.
-Web3 takes the metaverse a step further, implementing digital currency, tokens, and rewards redeemable either virtually or physically.
-Retail media networks will continue to gain momentum, providing targeted marketing and additional revenue opportunities.
-AI will become a stronger tool in retail, using first party data to influence personalized marketing messages that yield tangible conversion results.
-Right-sized retail stores and partnerships across smaller brands will continue to lead the expansion race.
-Gen Z consumers are currently driving the retail transformation, valuing both digital and face-to-face retail models. However, Gen A consumers will number 2 billion by 2025 further prioritizing social media and relationship-based marketing.
-Greenwashing will result in brand suicide this year, so businesses need to double down and stand behind their sustainability efforts.
-Nearshoring has been met with success by startups looking to sidestep the next supply chain disaster. Large businesses will continue to follow lead and in some cases partner together on cargo and storage space, providing an alternate revenue stream and savings for all.
-The Combatting Organized Retail Crime Act looks to decrease retail theft and violence rates, which have been steadily growing over the years.
-Continued warnings of an impending recession could lead to customers pulling back on purchases. However, although the number of transactions might decrease, they won’t sacrifice the quality, value or durability of the items they will continue to purchase.
Listen to the full NRF podcast HERE.
Have questions? Contact City of Morgan Hill Economic Development Director Matt Mahood at Matt.Mahood@morganhill.ca.gov
