Experiential, eco, and e-commerce: Consumer electronics retail trends in 2023
Enhanced in-store experiential shopping, a growing emphasis on sustainability and the continued growth of e-commerce are all key trends likely to see significant growth in 2023
Despite the rise of online shopping, the physical retail space remains essential for consumer electronics, and experiential shopping is central to this. The most obvious brand to spring to mind might be Apple, but there are an increasing number of brands offering what is also dubbed ‘retailtainment’ by some in the marketing world.
Another example is luxury fashion house Louis Vuitton, which transformed stores across the world for the launch of its collection with artist Yayoi Kusama, with stores such as Harrods redecorated with Kusama’s signature polka-dots and life-like animatronics of Kusama painting in the windows.
For consumer electronics in particular, where the sensory experience is everything, the experiential is likely to even more pertinent.
This is backed up data, according to 2020 study by Accenture, 77% of consumers are more likely to make a purchase when they have an engaging retail experience.
A study by Harris Group found that 72% of millennials prefer to spend their money on experiences rather than material things. To stay competitive, retailers are enhancing the in-store experience through interactive displays, personalised recommendations, and knowledgeable staff. They are leveraging technologies like augmented reality (AR) and virtual reality (VR) to provide immersive experiences that enable customers to test products before purchasing
In the Event & Experiential Marketing Industry Forecast & Best Practices Study 2021, 91% of respondents said that participating in brand events and experiences makes them more inclined to purchase. This same study also found that 40% of consumers feel they become more loyal to brands after attending their events and experiences.
Daniel Todoro is Managing Director of Gekko Field Marketing in the UK. He goes on to say that the experiential shopping is critical, not an afterthought.
“The research clearly highlights that experience trumps everything else when it comes to the physical journey,” he said. “Some 60% of respondents cite a pleasant environment as an important factor in a great retail experience. So, retailers should react by ensure they offer a pleasant in-store experience.
“From the moment the shopper walks in, lead them on an immersive journey towards the checkout, with creative displays and merchandising and where possible, provide an opportunity for customers to interact with the products. All this should be backed by product availability, highlighted promotions and all round first class customer service. Staff should be readily available on the shop floor and queues at the till should be kept to a minimum. An investment in staff is an investment in your future profitability.”
Growing emphasis on sustainability
As environmental concerns become increasingly important to consumers, sustainability has become a significant factor in purchasing decisions, and this is something we will increasingly see since the recent introduction of the EU Commission’s Right to Repair legislation.
Either as part of this obligation, or off their own backs, retailers are responding by incorporating sustainable practices in their operations, such as recycling programs, energy-efficient stores, and eco-friendly packaging. Brands are also launching products with a focus on sustainability, including recycled materials and reduced energy consumption.
In addition to a ‘repair don’t replace’ mindset, there is a growing preference for ‘swapping not shopping’ when it comes to mobile phones in particular, but also electronic games and consoles. In fact, a recent study by Mordor Intelligence found that the used and refurbished smartphone market size is expected to grow from $53.29 billion in 2022 to $71.91 billion by 2028, at a CAGR of 4.90% during the forecast period of 2023 to 2028.
It said that there has been a decline of the mobile device industry due to supply concerns, significant inventory levels, and reduced customer demand due to high inflation, and that the “smartphone will spend the next decade acting increasingly as a central hub until completely replaced by wearable screens, ubiquitous voice assistants, and ambient interfaces, thanks to converging trends, such as 5G and AI in the cloud.”
Continued growth of e-commerce
Finally, e-commerce will continue to dominate the retail landscape, with convenience of online shopping, competitive pricing, and a wide range of options make e-commerce a preferred choice for many consumers.
Retailers are adapting by optimising their online platforms, improving delivery services, and offering hassle-free returns. Additionally, they are embracing emerging technologies like voice assistants and chatbots to enhance online shopping experience.
According to e-commerce specialist Digital Commerce 360, US e-commerce sales reached $1.03 trillion in 2022, passing $1 trillion for the first time ever.
Ecommerce grew 7.7% year over year, the slowest such growth since 2009.
All this said, back in 2019, analyst GfK, questioned whether e-commerce was ‘facing its limits’ as it has witnessed China and Germany showing early signs of online retail’s share plateauing. These are GfK’s findings for the global technical consumer goods retail markets to be released at IFA 2019 in Berlin.
Norbert Herzog, GfK expert for retail insights comments: “The omnichannel approach is ideal as it offers the best of both worlds. It allows retailers to direct consumers to the retailer’s online channel, should a product be unavailable in-store.
“Physical outlets help shoppers make up their mind when they cannot easily choose between the more extensive choices online. As an increasing number of consumers believe there are too many choices in the categories they shop, having the option to shop in-store is a real advantage. According to our GfK FutureBuy study, 62% of global respondents agreed there was too much choice in 2018, up 8% from 2015.”
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