Blink, and you might miss it. The retail landscape is evolving at an unprecedented rate and staying ahead of the curve has never been more crucial.
Sellers, retailers, and inspiring new brands are experimenting with new ways to make retail more immersive. From virtual reality (VR) wearables to innovative new customer activations, 2024 is all about breathing new life into the shopping experience — both in-store and online.
In this article, we unveil the top 10 trends that will reshape the retail industry in 2024.
10 Retail Industry Trends to Watch Out for in 2024
- AI: The Big Game-Changer for E-Commerce Brands
- Omnichannel: Be Everywhere All at Once
- Social Commerce 2.0: The Community Marketplace
- AR and VR: Revolutionizing Product Interaction
- Brick-and-Mortar Evolves to Survive
- Delivery and Returns Get More Efficient
- Smarter Inventory Management
- The Personal Gets Hyper-Personalized
- User-Generated Content vs. Brand and Influencer Marketing
- Social-First Product Discovery
Top 10 Retail Trends for 2024
Whether it’s emerging technology like artificial intelligence (AI), or finding creative new ways to use it, there are countless ways to scale your business next year.
Here are some of the top trends retail experts are leaning into.
1. AI: The Big Game-Changer for E-Commerce Brands
Of all the new trends, artificial intelligence (AI) is almost certain to be the biggest disrupter of all.
In the coming year, we’ll continue to see even more adoption of AI in retail and e-commerce as companies like AWS and Google expand access to generative AI-building tools and other AI solutions for retailers.
“Generative AI is poised for a breakthrough in 2024,” says Paul Silverglate, vice chair, Deloitte LLP and US technology sector leader. “Expect to see Generative AI integrated into enterprise software, giving more knowledge workers the tools they need to work with greater efficiency and make better decisions.”
AI will provide the virtual brain power behind a host of evolving technologies, including social commerce, inventory management, customer service, and much more.
Some of the AI use cases we’ll see more of in 2024 include:
- Delivering hyper-personalized product recommendations
- Creating virtual experiences tailored to each customer
- Forecasting demand and planning inventory
- Offering almost-human customer service experiences
- Giving users enhanced product visualization tools with AI-generated AR and VR
- Offering smarter pricing and promotions
Honestly, there are too many potential use cases for AI to list them all here. The best way to figure out which ones make the most sense for your business is to simply dive in and start using it.
“AI holds the biggest growth potential for every e-commerce brand,” says Jared Day, Chief Operating Officer and Co-Founder, Nuleev. “From customer service to logistics, as AI grows, e-commerce is going to grow with it. We’ve already used AI to create applications that streamline some of our processes, and can’t wait until AI is advanced enough to power frustration-free chatbots.”
Get Started with AI:
- Try a software solution that incorporates AI — consider a sales forecasting tool, personalized product recommendation engine like Dynamic Yield or Depict.ai, or an AI-powered dynamic pricing tool like Prisync or Hypersonix.
- Use AI tools like copy.ai or Ahrefs for web copy, marketing materials, and optimized product descriptions.
Looking to the Future:
- Stay on top of emerging AI trends and retail use cases
- Keep an eye out for the development of that mythical chatbot customers don’t hate
- Consider building your own solution(s) or virtual experiences based on your needs
2. Omnichannel and Headless Commerce: Be Everywhere All at Once
In 2024, retailers will continue to expand to new channels, aiming to meet the customer wherever they are. More shoppers will come to expect an omnichannel strategy, with a seamless experience from a brand’s physical store to its online channels.
Some brands may find it simpler, more affordable, and more realistic to begin with a multichannel approach, adding new channels one by one and expanding incrementally — for now.
Whether you adopt an omnichannel or multichannel strategy, your brand will benefit from widening its online (and possibly in-store) presence.
Get Started with Omnichannel:
- Expand to a new mainstream, niche, or emerging marketplace
- Test out an international sales channel on a preexisting marketplace
- Experiment with SMS and WhatsApp marketing and shopping (especially if you’re active outside the US)
Looking to the Future:
- Start your own site on Shopify or BigCommerce
- Add a wholesale arm to your digitally-native business
- Invest in a total omnichannel brand overhaul
Brands with their own sites can start making their big move to omni or multichannel by decoupling the front and back ends of their sites and creating a customizable headless e-commerce setup.
“Headless e-commerce is one of the fastest-growing trends,” says Valeria Shugaeva, Digital Marketing Manager, Amitech Group. “It enables the seamless addition of new features and integration with third-party services. It can handle traffic spikes, deliver updates, and maintain without compromising the customer experience. It can respond faster to customer demand, experiment seamlessly, and save valuable engineering hours.”
With a leaner, more agile web setup, brands can implement changes fast and add new channels more seamlessly, without spending months in meetings with developers.
3. Social Commerce 2.0: The Community Marketplace
While it’s increasingly clear that brands and retailers will need to be everywhere to win, perhaps the most important destination of 2024 is social commerce. Instagram, Facebook, and TikTok shopping will likely continue to see growth, with social commerce trends like user-generated content (UGC) primed to explode.
One of the most important sales channels to take advantage of right now? Every Gen Z consumer’s favorite video-scrolling app:
“TikTok is the social media platform that seems to have everyone’s attention and which seems to be growing the fastest,” says John Frigo, E-commerce Manager, Best Price Nutrition. “We’ve had a lot of early success with TikTok Shop. TikTok is heavily subsidizing orders, and that won’t last forever. There’s also not a ton of competition on there right now, and over time, more businesses will migrate over to TikTok Shop.”
Get Started with Social Commerce 2.0:
- Try adding a social channel or two, like TikTok, Instagram, and/or Facebook Shops
- Build your own UCG campaign or experiment with influencer marketing
- Incorporate AR and VR filters and try-on into your social selling
Looking to the Future:
- Try a livestream campaign or platform, especially a niche livestreaming site — if and when livestream shopping finally takes off in the US
- Keep tabs on evolving social commerce trends, like Web3 and Metaverse shopping
4. AR and VR: Revolutionizing Product Interaction
Along with the rise of social commerce will come renewed interest and use cases for AR and VR. Expect virtual try-on and immersive AR experiences to become more exciting, innovative, and omnipresent throughout the social commerce ecosystem.
Meanwhile, the VR market is expected to rebound in 2024, with new devices from Apple, Meta, and ByteDance forthcoming.
AR/VR technology provides another way to fuel customer delight, bringing experiential shopping to the user’s phone — or straight to their face. Executed well, it can also be a vehicle for deeper levels of personalization and customer satisfaction.
“By enabling customers to virtually test out our mattresses in the comfort of their own bedrooms via AR and VR experiences, we can provide a more immersive and individualized purchasing experience,” says Martin Seeley, CEO, Mattress Next Day. “Customers’ interactions with products could be completely transformed by these technologies,” says Martin.
Get Started with AR and VR:
- Use tools like Snap Shopping Suite and TikTok Effect House to add AR filters and features to your social media channels
- Invest in virtual try-on solutions for your site, app, and other channels
Looking to the Future:
- Use Snap’s Augmented Reality Enterprise Services (ARES) to build a bespoke AR experience for your brand’s site and app
- If you expand into physical or pop-up retail, consider a virtual reality showroom or other in-store VR experience
- Expand into channels that enable selling on at-home VR wearables
5. Brick-and-Mortar Evolves to Survive
Around 50,000 physical retail locations are expected to close over the next five years. The slow death of traditional brick-and-mortar stores will continue to bring more shoppers online.
At the same time, online and DTC brands are using pop-ups and showrooms to round out their omnichannel profiles. And experiential retail is making a major post-pandemic comeback.
The physical retail models that survive and thrive will be those that reinvent the in-store experience, finding unique ways to fuse digital and physical shopping, and make in-person shopping sound like fun again.
Get Started Doing Better Brick-and Mortar:
- Offer even faster delivery and super-convenient returns
- Eliminate every last trace of friction from checkout and shipping
- Stock more of the products big box stores make it hard to get
Looking to the Future:
- Invest in providing a better customer service experience (in-house or outsourced) than brick-and-mortar, and paying wages that motivate your staff to win customer loyalty
- Experiment with innovative, experiential pop-ups and showrooms that take advantage of customer churn away from large retailers
- Get your product on the shelves of more innovative large retail stores through exciting in-store initiatives and activations
- Build more interactive online experiences using AR and VR to give shoppers a taste of the in-store experience at home
6. Delivery and Returns Get More Efficient
While speedy delivery on its own isn’t exactly a hot new trend, delivery times may get exponentially faster this year, with the biggest marketplace players pushing for more next-day and same-day coverage.
Meanwhile, Amazon and Walmart drones will take back to the skies to revive the battle for the literal drop-shipping market, adding new delivery zones and claiming delivery times of under 60 and under 30 minutes, respectively.
“Today’s online consumers want their products at their doorstep almost as soon as they hit the ‘buy’ button,” says John Murphy, Owner, eBike Generation. “Meeting or exceeding delivery expectations contributes significantly to positive brand perception.”
Returns matter almost as much as delivery, with more than half of customers saying they just won’t buy without the promise of free returns.
But the rising cost of, well, everything has led more retailers to start charging for returns and shortening return windows. Zara and H&M have begun charging for mailed-in items, and Amazon now charges for UPS returns.
While you may not have the budget to compete in the drone wars, you can still win over customers by pushing for faster, more transparent deliveries and cheaper, more convenient returns.
Get Started Revamping Delivery and Returns:
- Diversify your carrier portfolio so shipping delays don’t hold you back
- Partner with same-day local delivery providers like Uber, Postmates, Shipt, and more
- Invest in next-gen inventory optimization so stockouts never keep customers waiting
- Give your customers insight when you can’t give more speed, with in-depth order tracking and driver-contact options
- Implement AI tools and optimize product descriptions and sizing guides to help customers order just the right thing on the first try
- Offer free shipping on exchanges and/or incentivizing store credit over cash
Looking to the Future:
- Upgrade your 3PL for faster picking, packing, fulfillment, and more convenient returns
- Build your own in-house fulfillment network
- Add storage locations to shorten the distance to your customers
- Try an autonomous delivery robot, like Starship or Ottonomy
- Cross-sell and upsell related items during the returns process
- Find ways innovative to accept returns, like drive-thru services… or more robots
7. Smarter Inventory Management
With channel expansion comes the need for better inventory management systems. To succeed over the competition with a multichannel or omnichannel approach, you’ll need to make sure you aren’t stocking out on one channel and overstocking another.
“If you think about commerce overall, you see a huge shift from offline to online retail. In the future, the line between the two will become even more blurred, which adds a lot of complexity to inventory,” says Fabricio Miranda, CEO, Flieber.
Major retailers were still struggling to balance their inventory levels at the end of 2023. Moving into 2024, merchants will be more focused on reducing inventory glut and protecting margins as carrying costs increase.
Get Started Optimizing Inventory:
- Replace error-prone manual processes with automated demand forecasting systems
- Integrate your inventory tools with your sales channels for real-time alignment
- To avoid churn, configure your website to instantly switch to a pre-order or back-order option when a product sells out
Looking to the Future:
- If you have physical stores, give floor associates tools that let them check what’s in stock without having to “look in the back”
- Audit and compare potential new 3PL and logistics partners for scalability and speed
- Use predictive analytics to mitigate the risk of supply chain disruptors like natural disasters, pandemics, and political conflicts
8. The Personal Gets Hyper-Personal
Today’s customer wants to feel like they have a personal connection to their favorite brands. They also want to make fewer decisions for themselves.
In 2024, hyper-personalization will move even closer to becoming a baseline customer expectation.
AI solutions will empower brands to deliver deeply customized site experiences, marketing campaigns, and product recommendations that are tailored not just to certain demographics, but to each individual customer based on their needs and purchase history.
“Personalization is the e-commerce trend I believe holds significant growth potential for 2024,” says Einav Biri, CEO, FARUZO. “With advancements in AI and data analytics, e-commerce platforms can offer highly personalized shopping experiences, tailored product recommendations, and individualized marketing messages. This level of personalization can significantly enhance customer engagement and increase sales.”
Get Started with Hyper-Personalization:
- Invest in a personalization engine to automate personalization and increase engagement
- Use shopper quizzes to customize products, offer recommendations, and create unique experiences
Looking to the Future:
- Collect, analyze, and leverage detailed customer data, including behavioral and psychographic data
- Personalize chat, associate, and customer service experiences by sharing customer data with agents (and training them to use it well)
- Use omnichannel tools to share purchase history, shopping cart contents, and more
9. User-Generated Content vs. Brand and Influencer Marketing
Customers trust user-generated content much more so than other sources of brand information. If you don’t already have a wealth of UGC assets to pull from, now might be the time to get them.
In UGC campaigns, a brand typically creates a hashtag or other trend, designed to go viral and get customers sharing their content. As a major perk, they can also reuse that content in future ads, promos, and marketing campaigns.
User-generated content will continue to rapidly increase in adoption next year, with brands boosting and re-posting organic content about their products, and even CEOs amplifying brand mentions on their personal LinkedIn pages. As organic content becomes more the rule vs. the exception, retailers may see higher engagement on content with lower production value.
Get Started with UCG:
- Get as many product reviews as possible by reaching out to past satisfied customers
- Promote customer reviews as featured testimonials on your site and in ads
- Use social listening tools to track mentions of your brand on social media for inspiration
Looking to the Future:
- Create your own UCG campaign and hashtag, re-sharing user-generated images, video, and other content. For inspiration, look to brands like Vitamix and Crocs.
- Collaborate with micro and nano influencers to boost UCG campaign visibility
10. Social-First Product Discovery
Customers increasingly don’t want to go on Google or Amazon and search for a new product or brand — especially with changing SERP algorithms and layouts, and online marketplaces flooded with options.
Instead, they want to find new products while they’re busy doing other things — like scrolling TikTok to watch Hank Green analyze dog color vision, and then impulse-buying his charity-supporting Cancer Socks.
Half of all customers around the world have used social media for product discovery, and 59% have purchased a product through social media. Gen Z leads the pack, preferring TikTok and Instagram over Google when searching for a new brand to try. To get your product noticed, you’ll
need to stay visible and relevant on these channels.
Get Started with Social Discovery:
- Choose the right social commerce platform for your target audience — TikTok and Facebook have very different demographics
- Engage with followers and respond to their comments and mentions
- Optimize your content for social search and your bio for SEO
Looking to the Future:
- Partner with influencers who authentically share your brand values
- Stay up to date on trends and current events so you don’t commit a social faux pas
- Consider targeted social ads, especially those with “Buy Now” buttons that stimulate social impulse buying — a growing phenomenon
- Push more products toward the impulse shopper, promoting timely accessories at price points customers are likely to “add to cart”
Don’t Just Follow the Trends, Set Them
With so many new developments, it can be challenging to stay focused on what works right for your business. But at the end of the day, the future of retail will look different for each and every brand.
Before diving headfirst into any new trend, take the time to think through where you want to see the business in the next six, twelve, or twenty-four months — and where you need to invest in order to get there.
Because with the right plan, anything is possible. Learn more about how SellersFi can help you reach your goals with fast, flexible financial solutions purpose-built for e-commerce growth.
