Consumer Trends Impacting Retail in 2023

Demonstrate your industry expertise by staying current with consumer preferences and the technology that delivers their desired experiences.

Today's consumer has more choices than ever, and more retailers are competing for every sale. Winning those euros, however, comes down to giving consumers an experience that makes a positive impression. As it turns out, a great customer experience can boost sales revenue (up to 7 percent) and profits (as much as 2 percent), giving businesses all the incentive they need to meet consumer expectations.

Technology solutions providers (TSPs) should keep a close eye on consumer trends to equip retail merchants with the technology and solutions that deliver what the modern shopper expects from the buying experience.

What Consumers Want

The consumer trends influencing European shoppers range from personalization and sustainability to prices and convenience. Educate your clients on these trends and the tech solutions you provide that can support them.

Sustainability. It's no secret that many people in the EU are concerned about protecting the environment, and these values are even stronger among Gen Z. In some European nations, sustainability is the most important purchasing factor for more than half of consumers. Clearly, people want to do their part to protect the planet, and they're looking to retailers to support their ethics and actions.

Affordability. Shoppers also want to stretch their budgets, making affordable pricing another top consumer trend to watch. The cost of living is rising everywhere in the European Union and the UK as inflation and the war in Ukraine make everything from gas and food to housing and clothing a little—or a lot—more expensive.

Personalization. Another area of interest for European consumers is personalization. People appreciate when brands understand their tastes and preferences but hate when marketing efforts don't match up with their particular points of view. With nearly 50 percent of EU consumers saying it's okay to give brands personal details like age and location in exchange for a more relevant experience, merchants will want to consider getting closer to the customer.

Convenience. Consumers will always want anything that makes life a little more convenient. That's why click-and-collect revenue growth is on a hot streak across the EU and UK. In France, for example, it's expected to hit €14.3 billion this year from €11 billion in 2018, while the UK's turnover is on track for $11.9 billion, a jump of €5 billion in the same period. Retailers that don't offer convenient click-and-collect options are missing out on revenues.

How Consumer Trends Are Shaping Retail

As a result of these consumer trends, the retail landscape is changing. For example:

Secondhand. Resale, re-commerce, and pre-owned shops are driving the secondhand movement and the consumer shift away from exclusively buying new. Research from 2021 put the EU's secondhand fashion market, for example, at €34 billion by 2025 and found that 90 million people had tried their hand at reselling that year versus just 16 million giving it a shot in 2020. The resale market is too hot to ignore. Businesses across retail sectors should consider how to attract the re-commerce customer.

Quick commerce. Remember when two-hour delivery became the gold standard? Now it's more like 15 minutes, thanks to the quick commerce trend and startups racing to get groceries and household staples to customer doorsteps in record time. The quick commerce market is worth about €8.6 billion this year and growing around 11% through 2027. Technology to serve this opportunity will help merchants deliver even more convenience for customers.

Subscriptions. Some consumers just want to "set it and forget it." Subscriptions offer another convenience play for both merchants and shoppers. They give people the peace of mind that they'll never run out of must-have products, while retailers benefit from bankable recurring revenue. It's why the European subscription market's growing at a 17.5 percent clip through the next four years.

Help Your Clients Meet the Demand

Invest in building solutions that help your clients align with these consumer trends, such as more effective management solutions for efficient, accurate, quick commerce and managing secondhand inventory, recurring payments for subscription services, and automated and energy-efficient solutions that help them operate more sustainably.

In doing so, you can enhance your merchant relationships and establish yourself as a thought leader with your pulse on what matters most today.