As we’re taking on the new year, are we lacking a sense of optimism? Covid and the war in Europe are old news, but they are still shaping our emotions, expectations and general consumer trends. We might not be all out pessimistic, but we are definitely more realistic and cautious about taking on 2023, something that is clear from the predicted consumer trends for this year.
The influence of inflation
Now that we are less worried about our health, we are worried about our finances. Value for money is priority, but we also find value in the way products mirror our attitudes and outlook on life.
Small joys are what it is all about this year. Small indulgences serve as rewards or allow us some escapism as we are trying to control spending and especially, buying on credit. No big-budget holidays charged to the credit card this year.
Companies that manage prices to reflect the true cost of inflation, might do a better job at retaining customer loyalty. Brands will also have to carefully reassess their value proposition as the hunt for cheaper alternatives is on.
In the mood
As expensive and hedonistic options are pretty much off the table, we need to focus on staying in a good mood. Food that puts you into a good mood (read more) is an important trend for the year and so is overall wellbeing.
Seeking balance started during Covid times, but we are still evaluating priorities and trying to be proactive when it comes to our health. More than fitness and diet, a holistic approach to health includes digestive health and immunity.
Holistic sustainability
The theme of Cape Wine 2022 was Sustainability 360, but such a full circle approach to sustainability is also true for global consumer trends.
Sustainability is a trend that stays and while it applies to all generations, it is especially relevant to Generation Z. As they become adults, the demand for sustainability is set to be even more important. According to Business Insider, by 2030, Gen Z will earn 27% of the world’s income, surpassing millennials by 2031.
- According to a report by IBM, 77% of consumers consider sustainability and environmental responsibility to be at least “moderately important”.
- The Harvard Business Review indicates that sustainable products have a 5.6 times higher average sales growth than those not marketed as sustainable.
- According to a recent report by First Insight and the Baker Retailing Center at the Wharton School of the University of Pennsylvania, two-thirds of consumers from all generations will pay more for sustainable products, 44% of consumers prioritise product sustainability over brand and three-quarters of consumers find sustainability somewhat or very important.
Local is still lekker
Who hasn’t asked Google to find a place “near me”? A 2022 report from SafariDigital indicates that 97% of users searched online to find a local business.
An A for Authenticity
Like local sourcing and sustainability, authenticity seems to be on the trend report year after year. While authenticity in hospitality and experience is nothing new, I do think, for brands, it has never been as important as right now. Brands are expected to care – for their environment and now also for the wellbeing of their consumers. Authenticity and transparency are crucial.
Authentic means real and that is what consumers are looking for. Real people and real customer stories and endorsements. This is one of the reasons why social media stays important. According to Statista, in 2021 over 4.26 billion people used social media globally. This number is projected to increase to almost 6 billion by 2027. The report also shows that Internet users spend 144 minutes per day on social media and messaging apps. Not only does social media offer a lucrative marketing opportunity, it allows brands to let their personalities shine through, allowing them to be more human in their content.
Some brands might still be hesitant about using TikTok, but according to recent studies, 61% of TikTok users engage in ecommerce on the platform. Insider Intelligence projects TikTok to gain 9.6 million social buyers, adding up to 33.3 million people who make at least an annual purchase.
Lying about loyalty?
Is there really something like brand loyalty? Brand owners like to think so, but it is very clear that rising prices are undermining consumer loyalty and according to Blackhawk Research, as of July 2022, 25% of consumers said they were spending less on the brands they usually buy.
Brands in 2023
Other than taking note of the consumer trends listed above, what can brands do to ascertain brand loyalty?
- Listen to and then implement customer feedback.
- Optimise when it comes to innovation – this will ensure your brand to be resourceful.
- Limit waste.
- Create personal experiences – even though brands are expected to be privacy-friendly, customers are often happy to share data when it means content are tailored to their needs and they are not bombarded with irrelevant information.
- Ecommerce stays important. It allows you to sell directly to the consumer and even traditional brands like Nike now gets 35% of its profits from direct channels.
- Inclusivity is very important, especially to younger consumers.
- The shopping experience must be of exceptional quality. Frictionless and easy with 24/7 support and customer service. Customer service is all about the human element. Helpful employees and friendly, knowledgeable staff – whether it is online or in real life – are essential to your business.
- Engaging with consumers and caring about their experience are not limited to hospitality. Regardless of price points and promotions, customer experience is key.
Customer retention in a time of recession is a challenge, but if consumers trust your prices increases to be truly inflationary and when they experience genuine thoughtfulness, they might be more willing to stick with you. Brands have to find ways to give a human face to their stories and be honest and transparent enough to keep consumers reassured. Forbes says: Genuine thoughtfulness generates trust, and trust generates reliance and stability.
Read more:
- ourceful.
- Limit waste.
- Create personal experiences – despite the fact that brands are expected to be privacy-friendly, customers are often happy to share data when it means content are tailored to their needs and they are not bombarded with irrelevant information.
- Ecommerce stays important. It allows you to sell directly to the consumer and even traditional brands like Nike now gets 35% of its profits from direct channels.
- Inclusivity is very important, especially to younger consumer.
- The shopping experience has to be of exceptional quality. Frictionless and easy with 24/7 support and customer service. Customer service is all about the human element. Helpful employees and friendly, knowledgeable staff – whether it is online or in real life – are essential to your business.
- Engaging with consumers and caring about their experience are not limited to hospitality. Regardless of price points and promotions, customer experience is key.
Customer retention in a time of recession is a challenge, but if consumers trust your prices increases to be truly inflationary and when they experience genuine thoughtfulness, they might be more willing to stick with you. Brands have to find ways to give a human face to their stories and be honest and transparent enough to keep consumers reassured. Genuine thoughtfulness generates trust, and trust generates reliance and stability.
Read more: