Understanding Retail Consumers in 2023
Aug 08 2023
Anticipating consumer demand is one of those tricky challenges advertising has yet to perfect. Though digital marketing tools and insights – and access to big data in particular – have done their part to optimize ad performance, staying in touch with customers is a matter that all brands must attend to.
We took a quick look at the likely origins of today’s consumer buying behaviors, including what today’s shoppers look for in a retail brand and the overall sentiment toward difficulties like inflation and environmental sustainability. Here’s how user behaviors are shaping the marketing landscape in 2023.
What Influences Today’s Retail Consumers?
Inflation hit consumers hard last summer. A 40-year-high mark left the lingering impression among consumers that everyday goods were much more expensive than they ought to be – and have yet to return to what many might consider the “norm.” Understanding today’s consumers means sympathizing with them as sudden price spikes, unreliable shipping times, and product availability challenges led to an extremely turbulent customer experience over the past three years.
While these factors produced an initial (and understandable) downturn in customer sentiment, a promising trajectory starting in late November of last year gives today’s marketing experts hope for a healthy rebound. With the average consumer anxious to move past any and all COVID-19-related obstacles, it follows that some momentum is building behind recapturing pre-pandemic attitudes toward products and experiences.
Inflation is still near the top of everyone’s list of concerns moving forward (as is their favorite brand’s sustainability efforts), but abundant opportunities for seizing market share are likewise beginning to unfold.
What Should Retail Brands Expect in 2023?
No matter a brand’s size, product line, or current market share, there’s likely a qualified audience growing more interested by the day in buying from brands committed to sustainability and customer experiences. Of course, the tactics marketers employ to reach those audiences have evolved, too.
Brands leaning into the digitization curve can expect continued success in ecommerce and delivery services even as pandemic-era challenges dissipate. Though safety measures surrounding the COVID-19 outbreak have largely diminished, many consumers remain in the habit of ordering a wide array of goods and groceries to their own doorstep. The ease of dine-in apps and streamlined customer checkouts on mobile devices appears to have found a permanent audience moving forward, even as some consumers resume travel, restaurant dining, and live events.
Deloitte’s economic outlook for retail is conservative due to inflation’s impact on general purchasing power and the risk of recession, but still places a higher probability on the strong labor market driving overall sales growth through 2023.
How to Maximize Your Retail Brand’s Position
Many of today’s most evident customer buying habits are the natural result of increased digitization among businesses and increased time on devices among consumers:
-The health and wellness vertical is booming to the tune of 22% growth YoY, as more demographics show interest in improving or preserving their well-being.
-Celebrity-owned brands are also cruising, as brands wisely leverage established star power (and those massive built-in digital followings) for staggering results.
-TikTok has successfully positioned itself as a powerful sales-and-entertainment hybrid, enticing massive portions of its user base (estimates land between 25-50%) to quickly act on savvy product placement. Further estimates say 71% of TikTok’s sales are “spontaneous and unplanned.”
These variables put marketers in a healthy position heading into 2023, albeit one requiring some flexibility. You might have noticed a recent trend around the world of ad tech focusing on strategies based on first-party data, as the demise of the third-party cookie draws ever nearer.
Tapping into pre-built celebrity influencer audiences, appealing to audiences seeking out your specific vertical (as in the case of health and wellness), and broadly targeting audiences on platforms designed to inspire impulse buys will likely play a major role in the success of this year’s marketing campaigns.
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