Embracing retail tech trends to navigate the future of consumer behaviour

Alexander Otto, Head of Corporate Relations at Tradebyte, discusses new and emerging online tech trends and how they are altering consumer behaviour.

Technology is changing the way we, as consumers, operate in day-to-day life. It is heightening our expectations for ease and convenience and for our interactions with the brands around us. Retail –online in particular – is no exception.

In fact, it might be one of the industries most impacted by changing consumer behaviour. Brands and retailers who do not stay abreast of emerging online tech trends will fall behind competitors as customer convenience trumps brand loyalty.

In this article, we examine the tech trends disrupting retail and how vendors can harness them for an effective strategy.

Social selling

Social media has revolutionised how individuals shop online. Sophisticated analytics and data-capture capabilities make it much easier for retailers to understand their customers’ needs and desires.

As a result, social media enhances purchasing convenience for consumers, where browsing the finest deals and comparing prices has never been smoother with just a few taps on the screen.

As social media platforms continue to exert a powerful influence on users’ purchasing decisions and shopping patterns, brands and retailers will increasingly start considering how to extend their omnichannel strategies to encompass social media and craft a more engaging experience for their audiences.

Social channels will become an important means of driving sales while also providing vital data that helps determine what users want and how to generate user engagement.

By harnessing this data effectively, it’s possible to stand out through social experiences and make users come back for more. While traditional e-commerce marketing tactics require customers to switch platforms for checkout, social commerce allows on-platform purchases to maximise the potential for closing a sale.

This is particularly attractive for younger generations as studies report both shortened attention spans and an increased number of applications, websites and brands competing for their attention at any given time.

Live shopping

With the rise of TikTok, another growing online tech trend is the concept of live shopping, where customers are presented with products during a live stream. Here, they’re able to view the products virtually, ask questions and receive instant replies from the seller.

These real-time interactions, plus the urgency induced by limited-time offers and exclusive deals, combined with the establishment of a human bond, all contribute to capturing and maintaining consumer engagement.

This can be especially powerful when combined with social media influencers who converse with their audience directly, creating a sense of community and making consumers feel much more connected to the brand, enhancing trust and loyalty.

This distinct shopping method, which has grown out of east Asian countries into a $512 billion market, is now being integrated by marketplaces such as Amazon, allowing shoppers to discover and browse videos from different creators.

Comparable to an exclusive in-store event in which retailers can interact directly with each customer, the direct feedback loop allows businesses to understand consumer behaviour more effectively, refine their product offerings, and create a more interactive and personalised shopping journey.

According to McKinsey, live shopping could account for around 20% of global e-commerce sales by 2026.

Augmented reality (AR) shopping

AR will also significantly impact how users shop online in 2024. AR allows customers to envision how products will appear in a real-life environment, integrating aspects like orientation, direction, 3D modelling, and illustration with appropriate lighting conditions.

AR is progressively replacing traditional fitting rooms in brick-and-mortar stores, allowing customers to ‘try on’ accessories like glasses, watches, hats and other items of jewellery.

Numerous retailers also execute AR advertising campaigns on social media platforms such as Facebook and Instagram, enabling users to try new products.

Offering this kind of immersive shopping experience contributes to a better and more engaging experience for the customer. By enabling a better sense of the product that is akin to seeing it in a physical store, it may also result in fewer returns and the associated cost for the retailer.

Personalisation & AI

Personalisation is a key trend in e-commerce right now. Buyers are more likely to spend money and maintain loyalty when they have a relationship with brands, so it is increasingly important for online retailers to stand out from the competition and build a robust brand identity.

Moreover, according to McKinsey research, 71% of consumers expect personalisation, and 76% experience frustration if personalisation is absent.

This can be achieved by offering relevant recommendations based on customers’ online browsing or reminding them of items they have looked at but left in the cart.

Hyper-segmentation can also work well, dividing a customer base into niche groups to send the most relevant content and build more meaningful interactions. Done well, personalisation enables retailers to predict what a customer might need or pinpoint areas of their experience that can be improved.

AI can greatly help with this, filtering large amounts of data to build customer profiles that can be used to tailor e-commerce strategy and integrating generative AI into chatbots to make product recommendations based on shopping behaviour and preferences.

However, it is crucial to execute personalisation well, walking a careful line between being helpful and being intrusive.

Transparent and dynamic pricing strategies

Relying on manufacturers’ suggestions for retail prices (MSRPs) may no longer be enough. As the e-commerce landscape continues to face economic uncertainty with fluctuating customer demand and expectations, soft pricing remains a concern.

Choosing the right pricing strategy is, therefore, paramount for a brand’s success.

This can be managed by strategically maintaining a responsive shopping environment in the face of these economic uncertainties. By leveraging real-time market data, understanding consumer behaviour, and conducting competitor analysis, brands can stay ahead of the curve and enhance competitive advantage.

However, as consumers have increasingly access to information on other brands, their reviews, and comparative pricing, a pricing strategy that includes transparency becomes even more important.

We will also see pricing become more dynamic as digital platforms allow adjustments based on real-time data relating to market conditions. This will help businesses set competitive and profitable prices and attract and retain customers.

A profound transformation has altered consumer behaviour

The retail landscape is undergoing a profound transformation fuelled by technology that is reshaping consumer interactions with brands.

From social selling to live shopping experiences and augmented reality, these innovations prioritise convenience and consumer engagement.

Personalisation, driven by AI, plays a crucial role in meeting individual customer needs, while transparent and dynamic pricing strategies, informed by real-time market data, enhance competitiveness.

Technology must stay ahead, fostering loyalty and sustainable growth in an increasingly competitive market.

Source: innovationnewsnetwork.com