It’s no secret that consumers are reducing their spending in light of rising costs and an uncertain economy.
Despite the severity of the situation, consumers are still shopping and actively seeking out new brands and experiences. There’s a lot of positive energy out there, with the change in consumer behaviour bringing new opportunities to light.
It’s likely that independent retailers will start the year in survival mode as we wait to see how everything unfolds, but that will change as 2023 gets underway. After digging into retailer experiences and several hard-hitting industry reports, it’s clear that the activities retailers can do in 2023 to thrive fall into three categories:
- Digitisation: Marrying the online and offline experience with technology to create smooth, personalised journeys.
- Community: Building a hub of loyal customers who keep coming back and referring you to their friends and family.
- Sustainability: Doing your bit for the planet and aligning with the ever-growing consumer need for eco-friendly products and packaging.
How retailers can use digitisation to thrive in 2023
The most successful retailers are nimble. They’re quick to pivot at every change in their customer’s needs and take the time to understand the challenges and worries of their community.
Adaptability is key, but it can be near-on impossible to constantly switch up your processes by hand. This is where technology comes into play. It’s not simply a case of taking your store online and creating a functioning website, it’s also important that shoppers have a clear, friction-free buying journey regardless of whether they’re shopping online or in-store.
While it might be tempting to take your foot off the tech pedal and recoup any costs you’re spending on software, those who create a digital ecosystem in 2023 will progress the most.
Here’s how you can do that:
- Continue to invest in your business: While cutting your tech spend might give you instant cash, it can be detrimental in the long run. Consumers today want highly-personalised experiences geared to their own needs which is impossible to do at scale without the help of technology.
- Create a lean digital ecosystem: You don’t need enterprise-level tech to thrive. Find a handful of tools that meet your needs, like an email marketing tool, an analytics platform, and a platform to source and restock your inventory like Faire.
- Use technology to build joyful omnichannel experiences: Shoppers have different payment preferences, they prefer to shop on different channels, and they go through the buying cycle differently. Implementing technology throughout that process to deliver personalised recommendations, send restock reminders, and create follow-up campaigns can dramatically improve the customer experience.
Mrs. B’s Emporium, a bookstore in Penarth, has used technology to create a subscription service for its customers. They can choose the types of books they like to read and get them delivered to their door every month.
How retailers can create a community to thrive in 2023
The YouGov report revealed some interesting demographic info. 52% of Gen Z (a.k.a. 18-24-year-olds) plan to decrease their spending on non-essential products in 2023, the lowest of all age groups. They are famously loyal to their favourite brands and are particularly keen to support local businesses, so retailers that cater to them in their marketing campaigns and product selections will be rewarded with high engagement both online and offline.
But it’s not just about who you’re targeting in 2023, it’s also about how you’re reaching those people. Consumers are facing difficult times ahead; they’re worried about the rising cost of living and wild inflation rates. It’s important to address these concerns and remain sensitive to the current uncertainty in people’s lives.
Here are three ways you can build a community around your store:
- Demonstrate empathy: Every community needs a baseline of understanding and, as a result, empathy. In 2023 we’re going to see retailers communicating less often but more meaningfully with their customers, so intentional communication will be integral to your comms strategy.
- Focus on your existing customers: Your most loyal customers have stuck by you in good and bad times. Lean into ways you can support them, help them, and thank them for sticking around. For example, you might offer an in-store discount on their next purchase, a freebie when they spend a certain amount, or a simple personalised thank you note with each new purchase.
- Turn your store into a community hub: Every community needs a headquarters. Transform your store into a lively hub where shoppers can do so much more than purchase products, like attend a workshop, meet their favourite makers, or take part in a food or wine-tasting session.
A G Hendy & Co is a small homeware retailer in Hastings that invites customers to step back in time. It specialises in plastic-free, eco-friendly products set against a backdrop from times gone by. It’s a unique shopping experience that has created a local, loyal following.
How retailers can leverage sustainability to thrive in 2023
Sustainability is a hot topic for UK businesses, with 40% planning to invest in sustainable packaging options in 2023 and 85% of consumers wanting more sustainable in-store options. Retailers that tap into this trend will secure loyal customers and improve the overall perception of their business.
Mammoth retailers have the money behind them and the leverage to maximise their sustainability efforts, but small retailers are often better positioned to create sustainable shopping experiences–usually, they have a far smaller carbon footprint because they ship fewer products, they maintain a more local focus, and they are often more considerate about what they use in their packaging.
Here’s how smaller retailers will be leaning into sustainability in 2023:
- Buy from local brands: Retailers will source products from local makers to showcase on their shelves. This creates a unique in-store experience while reducing their carbon footprint (it also means they’ll be able to offer high-quality products at lower price points by tapping into local talent).
- Reinvent packaging: In-store, we’ll see retailers using recyclable materials for bagging and displaying products. Online, they’ll use sustainable materials throughout the shipping process, from manufacturing right through to the finished product.
- Give back: Small retailers are often in a great position to give back to their community. In 2023, consumers want to see their favourite businesses doing their part for the planet by giving back, whether that’s through an in-house recycling program or by donating funds to diverse and underrepresented makers and manufacturers.
Nourish Zero Waste is an entirely packaging-free grocery store in Ashburton. Shoppers are invited to bring their own containers to fill up to reduce the amount of plastic waste.
Make 2023 your year!
There’s still a sense of uncertainty around 2023, but it will bring plenty of fresh opportunities for independent retailers. While survival mode will characterise the start of the year, we’ll start to see more and more retailers thriving in 2023 as they implement key digitisation strategies, create loyal, engaged communities, and emphasise sustainability through their products and packaging.
Ready to start creating your lean digital ecosystem? Get started with Faire to find new and exciting brands to stock.