FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE - RUPA POPAT By - FUTR
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FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE — Examining evolving consumer and business trends in a post-covid world June 2020 By RUPA POPAT
FOREWORD
—
In a short space of time, Covid-19 has disrupted every aspect of our lives; the way we eat,
live, work and exercise. Businesses were initially forced into short-term planning and risk
reduction and whilst some businesses such as big tech and grocery retail benefited from
the increased demand for their product and services during lockdown, others were forced
to pivot or halt their businesses entirely.
Faced with evolving consumer behaviours, the emergence of challenger brands and new
disruptive business models, agility, innovation and digital transformation have been
requirements for today’s legacy brands and retailers for several years, to ensure they
stay relevant and future-fit. The current pandemic has intensified and prioritised this
requirement as we’ve witnessed dramatic shifts in consumer behaviour, acceleration
of digital trends, supply chains unravel and household names file for bankruptcy. Years
worth of digital transformation has occurred in just two months.
Whilst some behaviours and trends will return to what they were pre-pandemic, there
are others that are here to stay. These trends and behaviours will drive new innovation
and growth opportunities for retail and consumer companies. This report aims to
address some of these trends.
I hope you will find this report useful and would welcome any feedback. I would like to
take this opportunity to thank all the partners that have contributed to it with their real-
time knowledge and experience within our changing landscape.
Rupa Popat
Founder, FUTR Group
Rupa@FUTR.global
www.futr.today / www.futrinnovate.com / www.futrworld.today
2 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid world
CONTENTS
—
04 Introduction
05 Road to Recovery
09 Digital Acceleration
10 New Consumption Behaviours
14 Ecommerce & MCommerce Growth
14 Big Brands versus Direct-to-Consumer (DTC)
16 Building Brand Trust
20 The Land of Livestream & Social Commerce
23 Increasing Demand for Unique Experiences
26 New Routes to Content Creation
28 Offline-to-Online Innovation
29 Brick and Mortar Stores evolve
32 Rise of Contact-Free Commerce
32 Hyper-local and On-Demand
35 Agility & Innovation
3 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid world
INTRODUCTION
—
The coronavirus pandemic will be a trigger for profound change, as history of recessions
and world events have shown us. It has forced millions of people around the world to
fundamentally change the way they live, shop, work and behave, triggering a new social
mindset in an already complex business landscape. Developments which should have
happened in the next 2-3 years have been advanced resulting in an acceleration of
human evolution and ultimately the brands and retailers that serve them.
Many countries have started to move from the immediate response phase to business
revival and opportunity phase, with physical retail outlets opening or soon to open
in many markets. Brands and retailers will fundamentally change the way they do
business and will have to adapt to the fast-paced changing environment. It will be key
to build a solid roadmap for remaining resilient and bouncing back amidst fears of a
long-term recession.
4 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid world
ROAD
TO RECOVERY
—
It is predicted that the economy will return to the end of last year by late 2021 implying
that the pandemic will cost two years of growth (1). What recovery will look like will
depend on various factors:
Industry Sector
Some industries and businesses, who either have done well out of the crisis or at least
performed better than others, will emerge first.
Percentage of chief executives who say their business is at risk of not surviving:
A. Total 11% P. Distribution/Logistics 6%
B. Hospitality/Restaurant 41% Q. Construction 6%
C. Aerospace/Aviation 30% R. Professional Services (Consulting,
D. Retail and Wholesale 19% Agencies, Law Firms etc) 4%
E. Education 19% S. Production (Agriculture,
Chemicals, Mines, Utilities) 3%
F. Energy/Oil/Gas 17%
T. T
ransportation / Trucking
G. Media/Entertainment 15% / Railroad 3%
H. Automotive 13% U. Telecommunications 0%
N A
I. Food and Beverage 12% M
L
J. Other 10% K
K. Manufacturing 8% J
B
L. Real Estate 7%
I
M. Financial Services 7%
N. Healthcare 7%
O. Product Services H
(Technology Software, Saas) 7%
C
G
Source: YPO Chief Executive survey with 3,534
F
respondents from 109 countries D
E
5 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid world
It is no surprise that the hospitality, restaurant, aviation and retail industries have been
hit the hardest by this pandemic and therefore that CEO’s in that sector have the worst
business outlook. Whilst companies in healthcare, food & beverage and technology
software feel they are at less of a risk of not surviving.
Business Type
In addition to the industry sector, the type of business you operate will have an impact.
There have been clear winners and losers already since the pandemic began.
Some companies have benefited from trends brought about by the pandemic. Big Tech
brands have benefited as more people spend more money and time online. Amazon’s
sales exploded by 26% to $76 billion and it hired 200,000 people to support the surge in
demand. Whilst Facebook and Google, in the new world where consumers are forced to
reorientate themselves around digital services, have been perfectly placed to grab even
more land. As of May 2020, Amazon, Facebook, Apple, Alphabet and Microsoft accounted
for more than a fifth of the S&P 500 value.
E-commerce retailers in some sectors have naturally benefited. Grocery retailers such
as Walmart, Asda and Ocado have also witnessed increased demand and revenue even
after the initial phase of panic buying. Ocado reported a 40% rise in second quarter retail
revenue. Another sector that has witnessed growth is home office furniture. Wayfair saw
200% increase in searches for home office items in the UK in the past month and John
Lewis experienced a rise of 233% in office chair sales and 123% increase in desk sales.
At the start of the decade, the fitness boom was driven by boutique fitness studios
whilst the latter half of the decade has increasingly become about smart home workout
equipment. In 2018, it was reported that Peloton’s primarily at-home bike membership
had more customers than SoulCycle and a higher retention rate than Equinox. During
the pandemic, fitness classes have grown in popularity with digital fitness businesses
like Peloton and Mirror profiting from the home fitness boom. Mirror doubled sales of
it’s smart mirrors within the first month whilst Peloton hit one million connected fitness
subscribers last month.
One can’t mention the pandemic without speaking of Zoom, which as of May 2020
had a higher market cap than that of seven airlines combined. Video conferencing
companies have seen a significant growth in users since the Covid-19 pandemic has
shifted many people to online work. Zoom stock has surged this year as it emerged as a
dominant player during the pandemic, though Facebook and Google recently announced
new measures to compete with the company. Microsoft also showed strong growth
in Teams, its workplace chatting and video conferencing app, when it reported recent
earnings. Microsoft said Teams now has 75 million daily active users.
6 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid world
Many CPG (Consumer Packaged Goods) brands, including food, beverages, health
items and cleaning products have benefited from the current environment.
Whilst the pandemic has benefited some naturally, many others have faced challenges,
have had to pivot or looked at new ways to engage their consumers.
Many of the US’s darling consumer technology companies have not been on the right
side of market conditions. Two such companies are Class Pass and Rent The Runway
who both celebrated reaching $1 billion market valuations within the last 15 months.
ClassPass halved their staff count and pivoted to an online offering, the “netflix of home
fitness” with live stream and on-demand classes. Whilst Rent the Runway, credited for
pioneering the concept of women borrowing high-end designer clothes, have furloughed
staff and been forced to raise a new round at a much lower valuation.
Several ecommerce businesses have been forced to pivot and seen positive results
already. One such etailer is Flowerbx which lost 50% of its revenue overnight when
their B2B business came to a halt but through a more personalised digital marketing
strategy and identifying new customer profiles, their sales volume was up 600% in April
2020 versus the same time last year.
Many businesses have jumped on new consumer trends to expand their offering
meeting the current needs of their customers. Uber has launched Uber Direct which
offers retailers an on-demand delivery service to quickly get orders to customers at
home. So far, products being carried range from pet food to medicine and even postal
surplus. Deliveroo is one such company which has launched convenience stores and
grocery retail like Marks & Spencers and Morrisons on their platform to meet the growing
demand for online delivery and the new trend of home cooking versus food takeaways.
Whilst John Lewis has adapted their in-store services to be online via video. The
appointments are free and customers can talk to experts from different departments
about areas such as interior design or personal styling.
Those that were already struggling have witnessed years of decline condensed into
months. For retailers like Nieman Marcus, Arcadia Group, Carphone Warehouse, Oasis,
Laura Ashley and Cath Kidston, the pandemic has exasperated their existing business
challenges. Many of which won’t reopen all their stores post-pandemic. The need for
having an ecommerce strategy has been highlighted by fast fashion retailer Primark,
who was brought to a halt when their only channel, their physical stores, closed during
lockdown.
Hospitality, restaurant and aviation brands have been brought to a standstill, many of
which will take the longest to recover as even when the economy opens up, there will be
social distancing measures and a lack of consumer confidence to overcome.
7 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid world
Recovery Outlook
The recovery following a black swan event like this pandemic will also be dependent on
the type of recovery. Majority of CEOs (61%) in a recent survey (2), believe that recovery
will be a U-shaped curve - a sharp recession with a longer recovery. 22% anticipate
that the recovery will follow a W-shaped curve - a double-dip recession and recovery.
Few (12%) of chief executives foresee a V-shaped recovery, which represents a quick
recovery period.
Recovery Outlook D
C
A. U Shape 61%
B. W Shape 22%
C. V Shape 12%
D. Other 5%
Source: YPO Chief Executive B
survey with 3,534 respondents
from 109 countries
A
By Country
There is also the opportunity for businesses to look at China and other countries to see
how the economy has opened up there and learn from their successes and failures.
Recovery will be contingent on many factors including the number of cases, the
country’s business support schemes and how quickly lockdown, contact tracing and
testing were implemented and how effective these measures continue to be.
In summary, the industry sector, the business type, the recovery outlook and the country
will be just some of the factors which will shape how retail, consumer and hospitality
companies will come out of this period.
8 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid world
FUTURE TRENDS
IN RETAIL,
MARKETING
& COMMERCE
—
Many of the trends outlined in this section were waiting to happen - the pandemic has
just accelerated their arrival and many are here to stay post-lockdown.
Digital Acceleration
Consumer habits have shifted during the pandemic, of which some of these habits
will be here to stay. Digital acceleration is perhaps the most profound change that we
have witnessed of all the trends as consumers have spent increasing time online with
video calls, attending virtual meetings, online shopping, streaming TV shows online and
reading content and audio books.
Trends (likely to remain post-covid):
• Video socials with family far away
• New ways of earning a living or for businesses to operate
• Online shopping - across all sectors, specifically the rise of m-commerce
and social commerce
• Online fitness classes - more convenient way to fit a workout in
• Online banking - the branches will increasingly become a place for complex
transactions rather than everyday needs
• Online classes - a more accessible way to experiment with new hobbies
• Online streaming
9 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid world
Other trends likely to be temporary (the “Virtual Fails”):
• Online Group activities e.g. social gaming on the House Party app
• Watching the News on TV
• Live Performances without the experience
• Virtual events - whilst there will always be demand, the need for face-to-face events
and hybrids will emerge as social distancing rules are relaxed
Consumer Trends in order of Popularity
• Movie/TV Streaming
• Music Streaming
• Grocery Online Delivery
• Reading Content / Audiobooks
• Online Fitness Classes
Source: Bulbshare’s Covid-19 Report
New Consumption Behaviours
During this period, it is key for brands and retailers to be understanding their
customers’ changing needs. It will be key for companies to put their customer needs
under the microscope and adjust their strategies, tactics and offerings in response to
shifting demand.
In downturns, most consumers will typically reevaluate their consumption priorities
and as priorities change, consumers may altogether eliminate purchases in certain
categories. And because most consumers become more price sensitive and less brand
loyal during recessions, they can be expected to seek out favourite products and brands
at reduced prices or settle for less-preferred alternatives.
During this period, it is key for brands
and retailers to be understanding their
customers’ changing needs.
10 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid worldConsumer Segments’ STABLE MARKET MIXED MARKET DECLINING MARKET
Slight or no change Slight or no change for Substantial reduction
Changing Behavior in opportunities for
companies
stronger competitors;
a reduction for others
in opportunities for
companies
ESSENTIALS TREATS POSTPONABLES EXPENDABLES
SLAM- Will seek lower-cost Will deeply reduce or Will put off all durable Will eliminate purchases
product and brand eliminate treats or seek purchases unless forced in this category
ON-THE- substitutes such as lower-cost substitutes to make emergency
BRAKES private labels replacements, will delay
repais and personal
services, such as dental
cleaningss
PAINED- Will seek out favorite Will cut back somewhat Will delay major Will deeply curtail
brands at lower on frequency and purchases, repair rather expendables
BUT- prices but settle for quantity and emphasize than replace, seek value
PATIENT cheaper, less-preferred value and low ownership costs
alternatives; will stock up rather than extra features
on good deals and negociate at point
of sale
COMFOR- Will continue to buy Will be more selective in Will seek better quality Rarely regards
favorite brands at purchasing luxuries for the price; will any purchase as
TABLY prerecession levels negociate harder at point unjustifiable but
WELL-OFF of sale may reduce the
most conspicuous
consumption in this
category
LIVE- Will continue to buy Will continue to buy May buy if there is a Is reluctant to regard
favorite brands at favorite brands at great deal; otherwise may anu customary purchase
FOR- prerecession levels prerecession levels postpone as unjustifiable; may
TODAY not want to expand
consumption to new
types of purchases
LOW HIGH
RISK OF SALES DOWNTURN
Source: Harvard Business Review
Many global consumer goods packaged (CPG) brands have experienced high
performance in their categories, which can be expected to continue during the prevailing
recession. Data from previous recessions and current buying habits post-covid can
indicate which categories will perform better versus others in the coming years. We
can turn to past recessions however this only tells part of the story as this pandemic is
very different. For example, categories like sportswear and home furnishings may not
decline as much or may even grow given peoples’ limited scope to leave their homes
except to exercise.
New behavioural trends have emerged for the food & beverage category that is likely to
stay post-lockdown with an increased interest in home-cooked meals.
11 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid world“ During the pandemic, we have seen an
increased demand for health-conscious
and vegan food products, as well as an
increase in customers choosing to buy
via online channels with a higher average
basket value than before the pandemic.
This has resulted in more than a 1000%
increase in revenue on our website. ”
Stephanie Peritore, Founder & CEO, Mindful Bites.
Category Growth/Decline in the Developed
World in the 2008-2009 Recession
Source: Euromonitor International
12 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid worldMost popular shopping items during Covid:
Alcohol Ice Cream Chocolate Milk
Flour Rice Canned Food Oil
Gloves Masks Hand Sanitiser Fruit & Vegetables
Source: Bulbshare Consumer Trends Monitor April-May 2020
As consumers’ needs have been evolving, agile brands have been quick to adapt their
merchandising strategies to meet those needs. This will continue especially for those
brands who have agile supply chains and close dialogue already with their customers,
learning in real-time what their customers want and responding with highly topical and
relevant products.
• B
eauty brand Glossier well-known for its successful co-creation strategies,
announced its first hand cream in response to changing customer demand
• H
ighline Wellness adapted its product release plans to prioritise the launch
of CBD Immunity Gummies.
• W
hilst full makeup was viewed as unnecessary for consumers in lock-down, eye
makeup has been a key trend, as eyes can still be seen with a mask on so several
beauty brands have increased focus on this segment of their product offering
13 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid worldEcommerce & M-commerce Market Size Growth
Shopping online has become a safe and convenient way for consumers to buy products
during the pandemic and once “panic-buying” in grocery retail and essential health
subsided, this has opened up a growing opportunity for brands and retailers across multiple
categories. Whilst it won’t continue to grow at this rate forever, a subset of new online
customers will continue to shop online post-pandemic.
• M
ore consumers are now comfortable with e-commerce so this will expect to
continue post-covid. Looking at China for indications, the number of consumers
who shop online will remain inflated even after the crisis as more people are exposed
to the convenience of online shopping
• C
onvenience has always been paramount to younger consumers but online
shopping is increasingly being adopted by all age demographics which will offer
new opportunities for brands and retailers
• D
irect email, SEO and cheaper social media advertising have become more effective
digital marketing tools for online retailers during the pandemic resulting in higher
conversion rates
• M
-Commerce will continue to rise even more than desktop commerce. With global
mobile purchases currently at 70.4% of global e-commerce spend and predicted to
be worth $3.56 trillion by 2021 (3), it will be key for brands and retailers to continue
to improve and evolve their mobile propositions and build technology with a mobile-
first mindset.
Big Brands vs Direct-to-Consumer (DTC)
Big brands have spent the past decade fighting off their younger, sexier direct-to-
consumer competitors. Direct-to-consumer (DTC) brands were heralded as successful
disruption stories that lay bare the inadequacies of stale legacy brands. From shavers
to tampons and healthy snacks to calorie-counting beverages, direct-to-consumer
brands have been chipping away at big brand market share.
• B
ig brands have been experimenting and testing the DTC space for a while. Some
have made the leap already like Nike and Whirlpool. It’s a natural next step for
others to follow suit. For some, the first step may be to build their own consumer
database off the back of their social followings and enter via social commerce.
• I t was always an inevitable trend that more big brands would move into DTC and
that will now likely accelerate, for example PepsiCo’s launch in May 2020 of snacks.
com and pantryshop.com
14 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid worldPepsi’s New Direct-to-Consumer Offerings
These DTC offerings were created by PepsiCo within 30 days from concept to execution
since the pandemic began.
“ What Amazon did to legacy retailers,
big brands will do to DTC. ”
James Hirst, Managing Director, Rare Design
• B
ig brands recognise past recessions as good opportunities for growth and have been
progressing with innovation, agile and digital transformation agendas pre-pandemic
so this will likely drive them to invest in their DTC strategies at a faster pace
• T
he pandemic has forced some countries to begin experimentation with DTC out
of necessity. In countries like India, since the pandemic, dozens of CPG companies
including Hindustan Unilever, ITC, Mondelez, Procter & Gamble, Dabur and Colgate
15 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid worldhave started selling products directly to consumers by partnering up with startups
such as Dunzo, Scootsy and Swiggy who are listing brand stores on their portals
and circumventing their traditional distributor networks in order to reach their end-
consumers.
• D
TC brands that cover winning categories have experienced sales growth during the
pandemic such as CPG e-tailer Public Goods which witnessed a five-fold increase
in online orders since the start of the lockdown. However many DTC brands that
were frail pre-pandemic will continue to face ongoing challenges; high customer
acquisition costs and crowded channels, financial and operational difficulties,
returns management, declining investor support and the difficulty of bringing digital
intimacy to the store front.
• I t will be even more important for DTC brands to support each other, be supported
by their investors, explore new ways of strengthening their relationship with their
consumers bringing them even closer to the point of sale and continue to stay at the
forefront of their consumers’ ever-crowded smartphone screens.
• It’s likely we will see more DTC brands coming together in single sales or discovery
platforms. For example, @spendwiththem_uk and @shop.small.market are two
of many instagram accounts which support multiple brands. Social platforms
themselves will also increasingly support DTC brands. For example, the “Support
Small Business” sticker to help businesses reach new customers on Instagram.
The winners will likely be big brands and those in DTC that have strong brand
loyalty, a good cash runway in their bank account and are part of a category that is
recession-proof.
Building Brand Trust
Trust is more important now than ever for consumers. What brands do today during the
pandemic, what they say and how they act, how they serve their stakeholders and the
public good, could very well have consequences for them in the post-covid world.
16 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid worldIn a recent Edelman survey of 12,000 people (4), it found that:
• 7
1% of respondents agreed that if they perceive that a brand is putting profit over
people, they will lose trust in that brand forever
• O
ver 90% agreed that people want brands to do everything they can to protect the
well-being and financial security of their employees and suppliers, even if it means
substantial financial losses until the pandemic ends.
• 8
4% said they want brand advertising to focus on how brands help people cope with
pandemic-related life challenges
• 7
7% said they want brands only to speak about products in ways that show they are
aware of the crisis and the impact on people’s lives
• 8
5% want brands to use their power to educate. For example, offering instructional
information about how to protect themselves.
It won’t just stop at brands themselves, founders & CEOs are also considered part of
a company’s brand and their behaviours will impact the perception of the brand too.
This has been positive for brands like Twitter whose founder Jack Dorsey was quick
to donate $1 billion to coronavirus efforts but has been less positive in the case of
Virgin Airlines and Richard Branson’s personal pleas for government bail-out for the
struggling airline.
“ It’s more important than ever for
brands to show their true colours - how
a brand behaves now will impact brand
perception for years to come. There
are three things that brands should be
thinking about right now - be real, add
clarity and raise morale. ”
Theadora Alexander, Co-Founder Young Foodies
17 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid worldBrands have taken actions for the public good in multiple areas including switching
their manufacturing to PPE and other medical and health equipment and supplies.
Positive Brand Initiatives:
• S
ince the start of the pandemic when there was hand sanitiser shortage, personalised
beauty brand Skin Inc took to Instagram sharing video tutorials on how to make
homemade hand sanitiser and offered free delivery within it’s home market Singapore
• LVMH, Bulgari, Diageo, Coty and Anheuser-Busch have stepped into production of
hand sanitiser or sanitiser ingredients.
• P&G, Nordstrom, McDonalds, Unilever, Mattel and Hasbro are manufacturing or
donating face masks
• HP donated 3-D printers to hospitals to produce masks
• Club Med has repurposed its talent to design sports fitness at home
• TikTok pledged $250 million to support front-line workers and affected communities
• Uber is offering free food deliveries for medical providers
• KFC, Weight Watchers, Danone and Kraft Heinz have donated food or money for food
• Unilever donated $100 million worth of goods
• GE, Dyson and Rolls Royce pivoted to make ventilators
• Apple designed face shields
• Ralph Lauren, Gucci, Zara, H&M, Canada Goose, Brooks Brothers, Hanes, Fruit of the
Loom and Under Armour have switched production to masks and gowns
• Sweetgreens is delivering meals to healthcare workers and Domino’s, Chipotle and
KFC have given away free pizza, burritos and chicken to hospitals, medical workers
and grocery workers.
Negative brand perceptions and loss of loyalty may become apparent as the pandemic
develops but there have already been some early examples of banks that have limited
small business lending, airlines that are withholding refunds or insurance companies
rejecting valid business claims. These brands could face the aftermath of a post-covid
era where trust, community support, societal contributions and even painful sacrifices
may take a greater precedence in driving consumer choices.
As more consumers move online for more of their needs, privacy and data will continue
to rise up the agenda for consumers as they decide which brands they trust to take hold
of their personal information.
As interactions increasingly take place with brands digitally, there is a greater need
for brands and retailers to build a stronger emotional connection with consumers
than before.
18 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid world“ Brands and retailers will see a 3x higher
lifetime value with consumers if there is
an emotional connection.. ”
Alex Vaidya, Co-Founder & CEO, StoryStream
As physical interaction decreases and brands and retailers increasingly focus on online
channels and sales, it will be even more important to build an emotional connection
with consumers.
Case Study: Vauxhall
Vauxhall were looking for ways to make their digital customer experience more authentic,
human and trusted by allowing existing car owners to tell prospective customers how
much they love their Vauxhall cars.
Using User Generated Content (UGC) specialist StoryStream, Vauxhall have implemented
rights approved content created by passionate customers on their home page and all
key model pages. By displaying an engaging, visual mix of crowd sourced content, they
have been able to visually show prospective customers what it is like to own a Vauxhall
car through the eyes of their owners.
Since implementing this strategy, Vauxhall have seen an increase of over 25% in page
dwell times and their model page conversion rate increased by 6% when visitors had
viewed and engaged with the content.
19 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid worldAs well as their own digital channels, it will be key for marketers to reach consumers
on the platforms that matter most to them to build this connection. In a recent study,
Facebook maintained its rank as the most popular platform amongst consumers and
the marketers targeting them whilst YouTube was the second most popular platform
amongst consumers and Instagram the second most popular platform for marketers.
The platforms marketers and consumers plan to use more of
74%
68%
68%
50%
53%
34%
52%
59%
39%
45%
39%
18%
32%
29%
25%
29%
23%
14%
22%
Marketers
17% Consumers
Source: Social Chain
The Land of Livestream & Social Commerce
Livestreams have provided a level of localisation and normalisation for consumers
during lockdown and will go further as an engagement, communication and sales
tool for brands and retailers post-lockdown too. Social commerce will accelerate in
adoption as we see the next version of it evolve and see platforms like Instagram and
TikTok place an even bigger emphasis on live stream and integrate social commerce
within their apps. In order to understand the brand opportunity of live streaming and
social commerce, we can look towards China.
Live stream shopping compared to video
product presentations can drive 600%+
engagement and +10x conversion. (5)
20 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid worldLive streaming commerce sales in
China reached an estimated $61 billion,
a number now expected to more than
double to $129 billion in 2020. (6)
• S
truggling retailers and brands increased their live-streaming during the lockdown
in China across specific live stream platforms such as Yizhibo and Taobao Live
(which saw a 719% increase of merchants at the height of the lockdown) as well as
tech platforms Douyin, WeChat, Xiaohongshu, Red and Bilibili who are increasingly
emphasising or developing such capabilities.
• T
ikTok and Instagram’s donation stickers on live streams are just the start of the
world outside of China catching up with social commerce. It won’t be long before
complete transactions take place without ever leaving the livestream or social
platform, as was clearly indicated by Facebook’s announcement in May 2020 of the
launch of Facebook Shops for its Facebook and Instagram platforms, followed by
Messenger and What’s App soon.
• C
lose to 1,000 fashion, beauty and lifestyle brands live-streamed on WeChat for
International Women’s Day in March 2020. Viewers could watch various beauty
and fashion brands’ live-streams and on average users watched a live-stream for
8 minutes. The live-streams resulted in an increase of social commerce traffic by
83% (7) with brands like Elizabeth Arden racking up $21.6 million in sales over the
holiday, accounting for a quarter of its total sales in 2019 and overseas high-end
beauty brands like Shiseido, Estee Lauder and SK-II racking up 200% sales growth.
• S
tartups outside of China are piling into live streaming and social commerce
including Agora focused on their own content creators and beauty brands and
bambuser and Lisa which offer Saas offerings for brand and retailers’ own channels.
• S
hort-form video-based mobile app, Agora has grown organically attracting tens
of thousands of beauty enthusiasts and thousands of content creators since the
pandemic, who will ultimately be able to sell and buy from each other. According
to McKinsey, 80% of Gen Z still purchase beauty products in-store and they look at
three elements when shopping: content, commerce & community. Agora digitizes
these three aspects to bring their social commerce platform to life. CEO, Riccardo
Basile, adds “Agora is giving users an alternative to the experience of physical
shopping and the social interactions that come with it.
21 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid worldWhat have they been live-streaming?
• B
eauty brands have been livestreaming makeup artists, dermatologists and
influencers to host educational livestreams, offering everything from DIY tips to
self-care advice, as concerns around managing anxiety rise.
• R
etailers and shopping malls have turned their employees and sales staff into live
streamers for commerce.
• M
ost brands who are livestreaming are sharing their weekly schedules in advance
to allow customers to plan when they tune in.
• T
hey’re not just live-streaming about their products but also creating unique
experiences. For example, MAC has held karaoke competitions bringing consumers
together with celebrities.
What to expect
• W
hilst livestream will never replace physical events, it will become more essential
and necessary in the post-coronavirus era as it enables brands to have more agility
and connection to their consumers.
• T
raditional live chat features have often fallen short of expectations, especially
those powered by AI rather than humans
• A
s social media has become a more focused activity for users, expect to see easy
adoption of social commerce where the entire consumer journey and transaction
takes place on a social platform
• W
e can expect to see more sales taking place within social channels like Instagram
and Facebook as brands continue to see the importance of facilitating more human
interaction during the sales process.
75% of millennials’ purchase decisions were
influenced by a brand’s social media presence.
Whilst 52% of Gen Xers and 72% of Baby Boomers
find video most helpful when making a purchase
decision online. And over 50% of Gen Z trust a
brand with videos about their products more than
brands without. (8)
Born: Gen Z (1995 - 2015), Millennials (1980 - 1994), Gen Xers (1965 - 1979)
and Baby Boomers (1944 - 1964)
22 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid worldIncreasing demand for Unique Experiences
Over the past two decades it has become clear - consumers no longer buy just products,
they buy the best experiences. This has become increasingly prevalent with the rise
of digitally savvy Millennials and Gen Z and the youth-focused brands that court them.
From Coachella to Tough Mudder and pop-up street food festivals to fashion experiences,
the experience economy has been virtually shut down by the pandemic and brands are
rethinking how they create such experiences moving forward.
• B
rands have turned to digital channels to bring physical experiences to the virtual
world. Watching films with others in different households has been an increasing
trend seen via apps such as BBC Together and Netflix Party, as well experiences
such as Secret Sofa, which brings viewers together via a curated offering and a
private Facebook group
76% of consumers prefer
to spend on experiences than
on material items (9)
23 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid worldSecret Cinema
Secret Cinema is globally known for its go-all-out immersive cinema experiences where
participants get to live and breathe the world of the film they’re going to see. Since the
pandemic, Secret Cinema has pivoted to bring some of its magic to people at home via
Secret Sofa with a different film in focus each week.
As well as finding out what the film chosen is (with information on which streaming
platforms carry it), the email provides the usual Secret Cinema suggestions of costumes
and characters to make viewers feel part of that world. There are also playlists, food
recommendations and a different flavour of ice-cream can be ordered each week from
Amazon Prime.
Secret Sofa retains a social element as everyone starts watching the film at the same
time on the same day with a private Facebook group which invites people to chat before,
during and after the film. This aims to get people into the spirit and to make the effort to
participate fully rather than just watching the film in their pyjamas.
• B
rands have turned to social channels to create virtual experiences. Whilst some
consumers will have virtual fatigue, there has been positive results.
24 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid worldSuperdry #FitnessMyWay Campaign
Platform Influencer partnered with Superdry to launch their #FitnessMyWay Campaign,
promoting Superdry’s activewear range with the mission to work with creators to produce
content that inspires their audience to achieve their fitness goals. The programme had
begun in gyms pre-covid in the UK, France, Germany and the US.
Following the closure of gyms, the rise of online fitness classes and seeing the increase
in popularity of Instagram Live (288% increase in Live mentions on Stories), the
campaign moved online offering free, easy to access workouts from people’s favourite
creators through 30 minute livestreams wearing the Superdry kit.
• S
hopping experiences will thrive in a
post-lockdown era and retail spaces will
continue to offer value and experiences to
consumers even more than before. Stores
are no longer places to just buy products
and this will only accelerate.
• S
ome physical experiences will return
after lockdown, with social distancing
Source: @TheDriveIn measures in place. For example, the rise
of the drive-in cinemas already launched
in the UAE and UK
25 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid worldNew Routes to Content Creation
Influencers aren’t the only ones posting throwback content during lockdown. With a
reduction in their marketing spend, cancelled production shoots and limited budgets,
many brands and retailers have turned to existing imagery and branded influencer
content. As social distancing measures continue, we expect to see more innovative
content creation and campaigns.
• B
rands rushed to produce response TV adverts at the start of the pandemic, using
existing footage featuring pandemic messaging with common phrases such as
“we’re living in uncertain times” and “we’re all in this together.”
• L
uxury fashion brands such as Louis Vuitton, Burberry and Versace, rich in heritage,
have turned to their archives to create nostalgic moments for their customers
Brand Instagram Posts from the Archives
Burberry, 1954 Louis Vuitton, 2007 Versace, 1995
• Y
ounger fashion, beauty, lifestyle, wellness and fitness brands have turned to live
stream to stay at the forefront of their customers’ minds by providing value-add
content created in their own homes
26 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid world• Influencer marketing has become more attractive than ever for advertisers with a
rise in influencers being used for the content creation element, not just distribution
• There has been an increase in social usage, live and video (10):
Increased usage of Instagram to 37% in the UK
27% increase in TikTok engagement
288% spike in Instagram Live
16% increase for Twitch Live during March and April
19% increase in live video streaming on YouTube
Source: Influencer.com
• 8
0% of advertisers that have used Influencer-generated assets have said they have
performed the same or better than existing content forms in the last few months: (9)
Average impression rates increase by 29%
Average reach rates increase by 18%
Average engagement rates increase by 30%
Average click-through rates increase by 23%
Source: Influencer.com
• S
ome brands have turned to new ways of creating content. For example, TikTok
turned to Zoom to create their first TV advert, which explores the bright side of
lockdown life featuring content creators and celebrities including Little Mix, Tom
Daley, Tinie Tempah and Gordon Ramsey. The entire campaign was produced through
Zoom and produced by Social Labs.
Initial Coronavirus Response TikTok TV Advert using Zoom:
Brand Adverts A Little Brighter Inside
27 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid worldOffline-to-Online Innovation
We have already seen offline-to-online innovation and we can expect to see more of it
as the consumer journey will continue to become even more frictionless. The future of
retail is not a question of channels, but a new shopping experience without boundaries;
merging online and offline commerce.
• W
e can expect a complete redesign of the customer journey. Consumers will no
longer think in terms of separate purchasing channels but use them at the same
time for various purposes; product research, comparison, click and collect, store
to home, delivery or customer service. It will be a unified approach to consumer
experience that is immediate and hyper-connected. It will become more of a priority
for retailers to deliver this.
• C
hina, unlike many western markets, has successfully operated as an offline-to-
online innovator.
“ Retailers in China have been
offline-to-online innovators for years.
This pre-existed before the crisis and
so they were able to manage the loss
of physical retail during the pandemic
more easily than other countries. ”
Jonathan Smith, MD, Founder & CEO of Hot Pot China.
• It won’t be too long until there won’t be pure physical retail or pure ecommerce
strategies - they won’t be able to exist in silo.
• In the case studies of Zara Shanghai and Hema Supermarkets, transparency,
convenience, speed and hands-free shopping are key features of it’s consumer
offering. Both examples showcase completely integrated smartphone-centric
experiences from product information to automated check-out.
28 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid worldZara Hema Supermarket
Consumer Journey: Consumer Journey:
1. Y
ou go into the store and open 1. Scan QR code
the Zara App in We Chat
2. L
earn where the product
2. S
can the QR code of any items originates from and if of
you like interest, view food safety
certificates and distributor’s
3. Y
ou are then served a number
operating permits - complete
and wait to be called
transparency
4. H
ead to your dressing room
3. P
lace order via scanning
where all items are waiting for
the QR codes
you in your size
4. P
ay through Alipay or other
5. P
ay at the till or in the app
payment options
with WeChat
5. O
ption to request delivery
6. Option to request to be delivered
to your home with free same
direct to your home
day delivery within a three-mile
radius
Source: Hot Pot China
Brick and Mortar Stores evolve
To keep shoppers and employees safe, retailers have fast-tracked measures like offering
hand sanitiser and limiting the number of shoppers in stores. Education of hygiene and
safety measures will be key and there will be a requirement for technology that can
assist to drive more comfort to consumers and minimise human contact with service
staff. These could include some or all of the following:
29 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid world• R emote store services where some of the research and browsing process takes
place via video or live streams before arriving at the store like we are seeing with
John Lewis already
• Virtual try-ons and smart mirrors like seen with retailers like Ralph Lauren
• H ands free shopping and contactless checkout, similar to what is already the norm
in China
• U V Sanitation and self-cleaning tools for shelves and items that are repeatedly
worn or touched
• Innovative ways to sell excess stock caused by store closures, such as luxury
retailer Harrod’s outlet launch in Westfield
• Facial recognition thermal screening technology to detect body temperature
• Robotic services to replace some human customer service elements
Overall, expect to see more emphasis on health and hygiene measures, like the Lush
Cosmetics stores before the lockdown began.
Lush Cosmetics
As Covid-19 broke out, Lush launched the first public free hand washes to help halt
coronavirus spread. People were given soap and use of a sink at the retail chain, with
no obligation to buy anything.
“The simplest thing you can do to not get a virus is to regularly wash your hands,” said
Lush’s chief executive, Mark Constantine. “So we’re saying people can come in off the
street and wash their hands in our place. We’ve got loads of soap and plenty of hot water.”
30 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid worldHarrods
The luxury retailer will launch a new two-storey Westfield outlet in July to stock a
selection of items from fashion, beauty, accessories and other departments across
Harrods. The selection will be edited from the Harrods sale, which will also be hosted
more widely online.
The concept store has been designed to support higher levels of social distancing by
allowing more space for customers, enabling a wider product selection of new-season
product in the Knightsbridge store, as well as supporting the business in retailing
existing stock in a responsible and sustainable way.
“In the new world in which we find ourselves, the economy needs businesses willing
to look at its business model and current operations and think differently to enable
growth, while protecting its customers and employees,” Harrods managing director
Michael Ward said.
31 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid worldRise of Contact-free commerce
As social distancing becomes a way of life for some time, there will continue to be
increased importance on contact-free commerce where possible. Whatever can be
done at a distance will be done at a distance, even when government guidelines
continue to ease.
• C
ashless transactions will be on the rise even post-lockdown as health, safety and
convenience become the norm.
• It is expected that we will see the contactless card limit continue to rise
• T
his will also apply to online payments, delivery and collections - the retail shopping
experience will continue to change as we come out of the pandemic. For example,
companies like Klarna will become utilised more as customers start to split out their
payments over a longer period of time.
• H
ands-free shopping and contactless checkout in the physical store environment
could be another key trend that we see
• B
usiness models that embrace speed and convenience with contact-free commerce
and easy returns will thrive. For example, Yoox Net-a-Porter’s try before you buy
service and JD.com’s personalised courier service that wait while customers try on
clothes in the comfort of their own home.
Hyper-local & On-demand
From hailing a cab to getting a massage in the comfort of your own home, purchasing
medicine - on-demand apps serve many items to the comfort of our own homes.
There has been a rise of consumer demand for hyper-local and on-demand services,
as the pandemic has set physical constraints on national mobility. There has been
increased reliance on hyperlocal goods, businesses and business models, where the
entire supply chain is located in close proximity to the buyer and the seller driving speed
and trust in transactions. This is expected to continue as consumers value the faster,
cheaper and frictionless ease this offers.
32 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid worldThere is an increased awareness amongst consumers of what they consume and
where it comes from, that would translate to increased demand for products that are
produced close to where they are purchased - hyper-local supply chains. There has
been an increased appreciation for local businesses and locally sourced goods, where
the product sources are closer to individual customers resulting in faster and cheaper
delivery, more product transparency and ultimately customer satisfaction.
With this month’s launch of Facebook Shops for Facebook and Instagram and soon
WhatsApp and Messenger, this will empower more small and local businesses to move
online.
In India, the fast moving consumer goods (FMCG) sector, firms have rushed to tie-up
with delivery platforms like Zomato, Swiggy and Dunzo to ensure their goods keep
moving. These are companies who have traditionally depended on traditional mom and
pop stores to meet the market’s demand. In other countries, platforms like Deliveroo and
DoorDash have been quick to incorporate local convenience stores into their offerings.
Traditionally on-demand economy consumers have been younger, more educated and
more concentrated in urban areas but as these services become more mature, their
consumers are becoming more broad in age and location.
We can expect simplification of the supply chain as we know it and disruption in existing
business models which no longer support the hyper-local trend. Grocery stores will be
redesigned to expedite delivery orders, drive-through pickup lanes will be streamlined
to accommodate and enhance food delivery traffic and Yoox Net-a-Porter’s service
“You Try, We Wait” service, where customers try on clothes within the comfort of their
own homes will become increasingly prevalent.
As on-demand services
mature, their consumers
are becoming more broad
in age and location.
33 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid worldFlowerbx.com
Online luxury retailer Flowerbx, an online flower delivery service sourcing the freshest
flowers directly from growers, that in many regions are local to their customers.
They have seen a 600% increase in volumes of orders in the month of April compared
to the same month last year, with a doubling of conversion rate of visitors to their
ecommerce website due to their digital marketing strategy.
Whilst many of the world’s florists have had to shut down their businesses, Flowerbx.
com has been able to continue to service their customers.
“By partnering with local growers in the markets that we serve, we have been able
to increase output to meet the growing demand during the pandemic.” - Nasreen
Alimohamed, CFO, Flowerbx.com
34 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid worldAgility & Innovation
“ In times of economic
downturn, the right thing to do
is to keep investing in building
the future. ”
Mark Zuckerberg, CEO, Facebook
Agility, innovation and digital evolution are requirements for companies in recent years
to ensure they stay relevant and future-fit. The current pandemic has intensified and
prioritised this requirement as we’ve witnessed dramatic shifts in consumer behaviour,
supply chains unravel and household names file for bankruptcy. As in any recession,
companies that invest in new growth versus just cutting costs will thrive (11). Once
companies go beyond contingency planning, it is expected that digital acceleration and
corporate innovation will become priorities.
We’ve already witnessed agility and innovation by some brands and retailers during the
pandemic. Whilst broader digital transformation will take more time, brands and retailers
are driving innovation where they can, within their current structures.
35 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid worldFoodboxes.Asda.Com
As Asda continued to increase capacity of online grocery delivery, they wanted to ensure
that vulnerable and elderly shoppers had access to essentials. Within 20 days, they
launched a new online website in partnership with last-mile delivery partner StarStock
that sold food boxes containing 31 essential items. These were items that were hard to
get hold of during the lockdown like bread, pasta, long life milk and tinned food priced
at £30 including delivery.
Asda’s Chief Strategy Officer Preyash Thakrar said, “Big retailers don’t need to own
everything. We can partner with nimble businesses and startups that can move faster
than us. In this particular scenario, we partnered with a startup that could support
last-mile delivery.”
36 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid worldBrands and retailers should be using this period to drive new innovation and invest in
growth whether that is reevaluating their digital strategy, refocusing on new customer
needs, looking for inspiration to other regions and industry sectors, testing new concepts
at speed, building startup partnerships or investing in external innovation.
Speed and agility will be key factors for brands and retailers adapting to the post-covid
world. Charles Darwin’s words never hold more true.
“ It is not the strongest of the
species that survives, nor the
most intelligent that survives.
It is the one that is most
adaptable to change ”
Charles Darwin
In many industries, the most agile and ruthless will survive and enjoy outsized market
share on the other side. And it’s not just agility in terms of products created but also
those that can pivot different aspects of their businesses as needed. The ones that
make these adjustments will show the greatest resilience moving forward.
37 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
Examining evolving consumer and business trends in a post-covid worldOUR PARTNERS
—
Thank you to all our partners that contributed to the creation of this report.
Visual Identity Guidelines
September 2017
The most current information about the Pico+ brand identity is available on Pico group intranet. This brand guidelines will be updated periodically.
SOURCES
—
(1)
The National Institute of Economic and Social Research (NIESR) May 2020
(2)
YPO CEO Executive Survey April 2020
(3)
MerchantSavvy.co.uk
(4)
Edelman Trust Barometer Special Report March 2020
https://www.edelman.com/research/covid-19-brand-trust-report
(5)
Lisa, https://hello-lisa.com/
(6)
iiMedia
(7)
Reuter Communications
(8)
Animoto
(9)
Momentum Worldwide, October 2019
(10)
Influencer.com
(11)
Bain & Company
Report Disclaimer
This information has been obtained from sources believed reliable. We have not verified it and make no guarantee,
warranty or representation about it. Any projections, opinions, assumptions or estimates used are for example only and do
not represent the current or future performance of the businesses mentioned.
38 FUTURE TRENDS IN RETAIL, MARKETING & COMMERCE
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