2020 proved to be a disruptive year. It changed consumer behavior in ways we could never have imagined. For a significant number of retail businesses, it was fatal. However, for you, 2021 is going to be a year of recovery.
That said, it’s not time to get comfortable. Trends established by the COVID-19 pandemic will accelerate. And that’s not necessarily a bad thing if you capitalize on the opportunities created by them.
5 Retail Trends in 2021
1. Growth in E-Commerce and Digital Storefronts
Due to COVID-19, more consumers turned to digital retail platforms to shop. This is one of the biggest retail trends we’re seeing in 2021. According to Deloitte, retailers need to catch up on their digital sales strategy before traditional online retailers consolidate their grip on the market. US online retail sales grew from $343.150 billion in 2019 to $374.38 billion in 2020, showing a 9.1% growth.
Both apparel and accessories retail e-commerce in the United States is expected to generate $153.6 billion in revenue by 2024. This trend is likely to accelerate throughout 2021.
It’s therefore imperative that retailers find ways to get online. Luckily, some products and platforms enable small retailers to process online payments with no hassle.
2. Impact of Government Pandemic Relief
The $1.9 trillion Pandemic Relief bill will be a major boost for the retail industry. The government aims to provide $1,400 per person to households earning less than $100,000 a year.
Analysts have noted the stimulus effect following COVID-19 relief bills passed during the previous administration, which helped increase consumer spending during the summer and early this year. This will add to the momentum already building in retail, with traffic to apparel and luxury retailers improving.
3. Retail Market Consolidation
The pandemic has torn up the retail rule book. Approximately a third of all shopping malls will shut their doors this year. Small retail businesses have folded under the enormous pressure from economic retrenchment. As if that’s not enough, more pressure is being piled on small retail by online retail giants that have sophisticated distribution networks.
However, it’s not all gloom and doom in the industry. Retailers who continue to innovate and find ways to reach consumers find themselves increasing their margins by cutting brick and mortar costs.
Retailers who continue to adopt flexible payment systems and satisfy their customers will not only survive but thrive this year. This is yet another retail trend you need to keep your eye on this year, because it’s changing the game completely.
4. Health and Safety
According to a Deloitte survey, 56% of consumers were anxious about traditional in-store shopping due to a spike in COVID-19 infections this winter.
It’s therefore important that retailers invest in increased health and safety measures in 2021. Cashless purchases have become the norm. Investment in contactless POS systems for retail stores is imperative. This will rebuild consumer confidence in traditional retail which has been hit hard by consumer safety concerns. Only 23% of consumers in one study ranked retail as trustworthy.
5. Innovative Business Models
Despite the losses incurred in recent years and compounded by COVID-19 in retail, retailers need to regroup and work with the retail trends of 2021, not against. A rebalancing of cost structure will determine those who survive — and those who don’t. Businesses that were battered by the economic downturn and lockdowns have to rethink their business model. This is the new normal.
But there’s a larger opportunity presented by the COVID-19 challenge. A once-in-a-lifetime opportunity is presented to business owners to innovate. Creative approaches in retail will determine if thousands of businesses will be handed over to the next generation or whether they will die a slow and painful death.
At True POS, we have developed payment and store management solutions that will increase your retail business profitability and efficiency.
Contact us today to get your free quote.