How in-store shopping, social media, resale, sustainability, and online shopping trends will drive revenue for brands in 2023.
If you work in fashion retail, chances are the biggest trend in your workplace is the great unknown. The unexpected is the new black. And, while a well-trodden retail roadmap may be the perfect security blanket, isn’t it a tad exciting that there’s room for innovation and the chance to be truly original in retail again?
On the flip side of blazing new trails, there are already a number of retail trends setting (or reacting to) the current retail score. 2023 is looking turbulent cash-wise, and no one feels the wobbles of the economy like fashion and luxury retail, so says the lipstick theory.
So, therein lies your challenge for 2023; to make sure your customer’s disposable dollars are making their way to your brand.
How? The short answer is to leverage promising avenues of technology online and offline to provide customers with new and exciting ways to shop, purchase and - yes - save.
Though, if a money-saving message isn’t exactly in your brand DNA, think about how else you can empower your customer base. Again and again, the best thing you can do is ask yourself, ‘Why?’. Why should the customer buy from you?
While you’re mulling over your answer, let’s take a look at how the following categories will drive revenue in 2023; from bricks and mortar to social media, resale, sustainability, and online shopping.
Social media
It’s becoming more apparent that having a Plan B for your Meta activity is essential. Social media advertising just ain’t what she used to be. It’s expensive, and the results can be lazy. This is why many brands, particularly DTC labels, have already dipped out of advertising on social media, taking their budgets and planting them elsewhere.
Once the slump hits, it’s hard for a social media platform to recover; think MySpace, Vine, and how Snapchat was never really the same post-Kylie. While the fashion world waits for Twitter to be the next case study, the better news for retailers is that Instagram still breathes life into social shopping and boasts most brands’ audience base. TikTok continues to make waves and spark trends, however, it remains to be seen how the majority of retail brands can effectively leverage the space.
As a result, it’s increasingly trending to build a digital ad strategy beyond social media and consider how to rely less on social media platforms for organic content. Here’s what the future could look like:
- Experimenting with advertising on streaming networks. What shows could you align with? A House of the Dragon ‘get the look’ might get pretty weird, but perhaps not in the instance of say, Heartbreak High. Look at how Boohoo, Missguided and Pretty Little Thing lure in the Love Island database, and then back it up with brand ambassadorship. It’s a match made in FMCG heaven.
- Influencers! Right now they’re your gateway to staying alive on social media indirectly. If you redirect your ad budget into influencer marketing, you could have a higher chance of reaching not only more people, but a more authentically engaged audience.
- Can we all just be cool and mysterious like Bottega Veneta? The brand launched its own brand app after leaving social media, and ahead of Matthieu Blazy’s first show… and it’s making me wonder what I’m missing out on.
You could always just start by taking a step back on your ad spend and see what happens. Don’t forget, brands made money before social media.
Online shopping
Bracketing, ever heard of it? You’ll know what it is if you work online in the returns department. This is the practice of purchasing several products online with the intention of returning at least a few items. This could be size bracketing, purchasing on, up and down their size, or colour bracketing, trying the black or the white. Then there’s bracketing on a department-store scale, where the customer orders a mini-wardrobe, and perhaps returns half of what they bought.
According to Aaron Pease, growth director of Happy Returns, “Just under 40% of people say they plan to do it next year, and almost 60% of consumers younger than 30 say they plan to do it this holiday season.” This trend unfortunately wreaks havoc on your sales targets, especially if you offer free returns. It’s no secret returns are a big problem, but there are ways you could potentially reduce bracketing while improving the overall customer experience. This could be by improving your product descriptions, providing online support via chat, post-purchase optimization, surveys, and transaction data-tracking.
If you’re sick of hearing about implementing personalization strategies… then you’re probably not implementing enough. Though oxymoronic, Forbes suggests applying technology to enable "personalization at scale". To be successful in this area, brands will need to understand and apply the millions of data points to tailor experiences, services and products that appear unique to the individual. Personal touch points will help a customer not only feel that your brand is for people like them, but truly for them.
Finally, as more and more shoppers associate with brands that share their own values, brands need to double down on the post-purchase experience. Gone are the days of guilting and pushing customers after they buy. As we mentioned earlier - empower your customers to align with their own values when they purchase from you. This in turn will result in customer loyalists and strengthen lifetime value.
In-store shopping
Since the return of in-store shopping, it’s hard to deny the value of bricks and mortar stores - especially where fit and fabric are concerned. Getting sales are still front of mind, but what’s trending now are the ways and means of what a store can truly offer the customer.
This could be down to its Instagrammable location, its size, the way it’s merchandised, or the kind of products you choose to sell in-store from your range. We’re not in the Victoria’s Secret era of store location saturation. Newer and niche brands are opting for smaller and fewer stores in locations that suit their customers and offer a simplistic space to shop - rather than big flagships on high-traffic shopping streets with overwhelming choices.
Hybrid shopping is still a major theme, serving as the bridge between the online and in-store experience. Today brands can consider their physical space in any number of ways; to host events and immersive experiences, create brand awareness and consumer trust, and even serve as a small warehouse for stock-holding, and picking up Click and Collect orders.
Resale
This year saw the likes of fast fashion’s goliaths, Zara and Shein, jump on the resale movement. Known for their eye-watering #SheinHauls that largely capitalize on the bracketing trend, Shein now allows these types of shoppers to re-sell their discarded Shein gear through an app. Zara has launched Zara Resell, which allows customers to on-sell their goods, while also offering repair and donation services.
Meanwhile, Poshmark and Depop have been acquired by larger competitors, ThredUp saw its share price fall to 77 cents, and The RealReal is now adjusting its business model to accept fewer low-price items with the aim of greater profitability.
Resale was one of the very few sectors that soared during Covid, that is, 109.4% between 2016 and 2021. And, if 2023 is looking down, then perhaps resale will be looking up - if consumers feel they can justify second-hand purchases more easily.
Currently, according to this report, resale products make up approximately one-quarter of secondhand products buyers’ closets and are expected to make up 27% of closets by 2023. But without a crystal ball, at this stage for resellers, it looks like it’ll all come down to timing, resources, a strategic approach to counterfeiting risks - and of course - a loyal customer base.
Sustainability
The fashion industry has big dreams of shifting an entire sector into a circular economy. As we know, shoppers are associating more with brands that share their own values - but not when the values are simply for marketing purposes.
Many brands have become the target of a greenwashing crackdown, with sustainability bodies asking for retailers to be transparent about sustainability claims. According to regulation rules, a brand can effectively communicate its practices to the average customer if they:
- Plug data gaps if there are discrepancies in how a material can vary depending on where and how it is produced
- Have data findings verified by a third party, and continue to have it reassessed to remain up-to-date
- Ensure in their marketing that what is being measured is clear and any gaps are also communicated
Importantly, it’s the way a brand thinks about sustainability that can help drive change. Sustainable practices do not have to come at a loss to your company if the customer is willing to pay more for the practice; like manufacturing, or the returns process.
For example, 41% of shoppers would be willing to pay more for a more sustainable return method. If you are transparent about the way you’re being sustainable, then your customer is more likely to feel better about a higher price tag.
The year ahead may be filled with unknowns, but implementing the above areas into your strategy for 2023 will help drive revenue for your brand. Stuck for time or resources to stay on top of trade or merchandising? Leveraging technology for your brand to cut costs, save time, and empower fast decision-making will have you on the front foot when it comes to mastering retail in 2023 (the great unknown). Reach out to us today to see how we can give you the competitive advantage to stay ahead of the pack next year.
