2023 Retail Innovation Trends

Quality Brand Content Will Inspire Consumer Confidence

“Moving into 2023, compelling product content will matter more than ever. While a majority (70%) of online shoppers say they often don’t buy products because of poor content or no content at all, retailers with quality, interactive content will drive good commerce. In addition to achieving low returns, more upsells and cross-sells, and larger shopping carts, consumers will feel confident in their purchases, knowing that what they see on a brand’s website will match what they order.” — Steve Sivitter, CEO at 1WorldSync

Shifting to First-Party Data

“Many consumer packaged goods (CPG) brands rely on third-party data, either supplied by retailers at their discretion or research firms in aggregate. However, neither option allows these brands to build direct customer relationships. In 2023, CPG brands will shift their focus to first-party data to enhance personalization and develop one-on-one connections with customers. More brands will put QR codes on product packaging with a call to action inviting consumers to scan it after purchase. Then, the brand can ask for the customer’s email address to send personalized coupons, offers and other relevant, targeted information. Adding QR codes to marketing campaigns will allow revenue teams to analyze and track the number of scans to more accurately measure campaign success.” — Sharat Potharaju, CEO and co-founder of Beaconstac

E-commerce Growth Will Return

“The mass adoption of digital between 2020 and 2021 led to incredible gains in e-commerce sales for nearly every sector. In 2022, sales were much more leveled, if not challenged in certain sectors, with businesses measuring against prior years’ astronomical gains. While this leveling off was to be expected, we should expect stronger numbers again in 2023 — approximately 15% year-over-year growth in e-commerce versus the 5% we have seen this year. Many businesses have spent the past few years putting time and resources into their e-commerce experience, enhancing their ability to attract, retain and convert customers. This coming year will show the sustainable value of those investments.” —  Raj De Datta, CEO and co-founder at Bloomreach

Power of Customer Retention Grows in Importance

“During the last decade, there’s been a massive bias toward customer acquisition, but far too little emphasis on customer retention. The tables have shifted as the costs of customer acquisition channels have increased dramatically, as privacy changes. In particular, Apple’s iOS 14 changes have eliminated retargeting techniques marketers had become overly reliant on, and pressure on marketing budgets driven by the challenging costs of capital and economic conditions. Now the game is focused on being better at marketing to the customers you have already acquired, and thus the data customers share as they engage directly with brands and retailers is of paramount importance to driving personalized and tailored communications and marketing as never before. The coming year will see many brands turning to the existing customers that they’d previously been neglecting and focusing on repurchase rates and more profitable marketing channels, such as email and SMS.

And the key to successfully re-engaging those customers will be the personal and contextual communications and content that retailers can infuse into the experiences they deliver across their digital channels. Brands underestimate the power personalized marketing can have in making a customer feel valued. Increasing sales from a customer you’ve already acquired is the most cost-effective marketing strategy you’ll ever use.” — Brian Walker, chief strategy officer at Bloomreach

Economy Necessitates Marketing Experimentation 

“Everything will be about pricing for the next 18 months. Last year, the greatest challenges facing merchandisers and marketers arose from supply chain issues. Now, most supply chain issues are mitigated, but prices are inflating while consumers are strapped. To identify revenue generation sweet spots, marketers will need to leverage different audience models and run more experiments than in the past. For the next 18 months, marketers will feel like they’re going after a moving target — because they are.” — Benjamin Dorr, COO at Cordial

Retail Media Growth Is a Matter of Real Estate

“Retail media growth is a matter of real estate. First, companies need a big enough network to have profitable ad inventory space, access to first-party data and a broad understanding of their loyal shoppers' buying patterns. Then, businesses can utilize that information to develop locations designed to meet their customers' needs. We will start seeing more specialized, carefully curated stores from large retailers. As the emphasis on retail media increases, brand-new environments will begin to appear, completely changing the shopping landscape.” — Brent Oakley, CEO and co-founder of Vibenomics

Brick-and-Mortar Isn’t Going Anywhere

“One significant story emerging from the retail market this year is the prioritization of brick-and-mortar, in-store experiences. The pandemic led to rapid e-commerce growth, but online retail growth has plateaued since conditions have normalized. More than 80% of products being sold are coming off of the shelves in brick-and-mortar stores. Customers still want to shop in person, and companies continue investing in retail media and expanding their inventory to enhance the in-store experience. While technology will never completely overtake our lives, innovative companies will keep creating technology designed to meet and benefit us in non-digital environments. In 2023, we’ll see brands prioritize their in-store presence and how they can leverage new technologies like digital out-of-home and audio out-of-home to target key audiences in brick-and-mortar settings. Forward-thinking grocery and retail environments like Kroger are the perfect example of coupling technology with the in-person experience.” — Paul Brenner, chief strategy officer and president of audio out-of-home of Vibenomics