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5 Retail Predictions for 2022

A woman shopping on a device at home: retail predictions
About 91% of customers are more willing to make another purchase after a great service experience. [damircudic / Getty Images]

Here's how retailers will further accelerate their response to the trends that transformed the marketplace in 2021.

(Note: Rob Garf, vice president and general manager, retail, collaborated with the author on this post.)

In 2022, retailers only need to follow one north star: connect online and offline shopping experiences and remove friction across the journey.

For customers, this is fantastic news. They’re enjoying a seemingly endless array of ways to engage with their favorite brands online and in the store. Agile and innovative retailers are moving from scrappy to scale in order to keep pace with rising expectations amid a digital revolution. 

Retailers have an opportunity to seize the day and increase relevance by: 

  • Increasing digital and analytical competencies to compete against digital natives and consumer goods companies that are increasingly selling directly to shoppers.
  • Providing personalized experiences – 66% of consumers expect it – as marketers face a cookieless future
  • Delivering seamless experiences as shoppers traverse an average of nine channels to make a purchase.

So, what are our retail predictions for succeeding in a fragmented but converging marketplace? Here’s a hint: It starts and stops with the customer. Here, we predict the five areas where retailers will transform in 2022.

Drive costs down and loyalty up all year long

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Retailers will humanize experiences to drive loyalty

While 66% of shoppers expect companies to understand their unique needs and expectations, only 32% of retailers have the full ability to turn data into personalized experiences. Retailers will establish new – or reimagine existing – loyalty programs to acquire and engage shoppers in a meaningful and personalized way. This will be a crucial advantage as third-party ad trackers become a thing of the past. 

But keep in mind that transactional rewards aren’t enough to ensure customers stay loyal for life. Younger generations want different benefits from their loyalty programs. Millennials and Gen Zers, for example, value exclusive access to limited products and experiences nearly two times more than Baby Boomers or those in the Silent Generation.

Data will finally be democratized to differentiate loyalty programs. These programs rest on a foundation of valuable data, such as product preferences, purchase history, and rewards balances. Retailers can deliver offers and experiences tailored to a customer’s unique needs and expectations – well beyond accumulating points – when this data is operationalized across touchpoints. 

How can retailers ensure they stay on brand, no matter how and where their customers shop?

Retailers will unify commerce across emerging platforms

How can retailers ensure they stay on brand, no matter how and where their customers shop? The right technology connects digital and store interactions to enable a frictionless and consistent journey. That’s why we predict retailers will knit together online and offline touchpoints to deliver one seamless experience. Two areas in particular will stand out this year:

Commerce will be pushed to the edge

Building commerce capabilities into social media, messaging apps, gaming, and even the metaverse rises as retailers embed their brands where people are discovering and buying products. This is particularly important in an era where digital native and other direct-to-consumer brands are engaging shoppers on emerging commerce platforms.

Streamline process across online and offline

With 60% of digital orders influenced by the store – whether demand is being generated or fulfilled – retailers must scale operations to smooth out capabilities like store fulfillment and endless aisle.

To satisfy the needs of the increasingly digital shopper, we predict retailers will offer digital service anywhere. 

Retailers will leverage digital service to humanize the experience

Service has become the next frontier of experience — 91% of customers say they are more willing to make another purchase after a great service experience and 80% of those same shoppers will abandon a retailer after three bad experiences. To satisfy the needs of the increasingly digital shopper, we predict retailers will offer digital service anywhere to humanize the experience. 

Virtual agents

Although 83% of customers expect a support agent to engage with them immediately, this can be challenging as employees are still remote. Retailers must connect their systems and data to give service agents a complete view of customer interactions at any location – at home, in the store, or on the beach.

Automated service

The good news is 82% of customers either currently use or want to use self-service for simple tasks – giving them time back to engage with friends, family, and colleagues. Automated service, which leverages insights to accommodate personal preferences, streamlines straightforward journeys like creating a return shipping label or checking the status of a delivery.

AI-powered chatbots

Similarly, 70% of customers either currently use or want to use chatbots to get answers to simple questions, like their current rewards balance or the status of a backordered product. Chatbots use artificial intelligence to resolve common inquiries quickly, but the challenge is engaging in a genuine and authentic way – allowing brands to have a personal touch while keeping costs at bay.

Retailers will continue evolving the brick-and-mortar experience

In-person shoppers aren’t going anywhere just yet. Don’t underestimate their economic impact: Even during the height of the pandemic in 2020, 82% of sales occurred in-store. As COVID-19 lingered throughout 2021, 1.2 million retail jobs opened up. That’s why we predict retailers will prioritize investments in stores and associates this year. 

The innovation lies in its evolution. For example, nearly one-third of retailers plan to turn locations into micro-fulfillment centers with popular fulfillment options like buy online, pick up in store (BOPIS). In fact, retailers with creative store fulfillment options grew revenue two times higher in the five days leading up to Christmas than those that didn’t. This gave consumers the confidence to shop online and had the same effect as extending shipping deadlines — a critical advantage during “shippageddon.”

The supply chain challenges and labor shortage in 2020 inspired retailers to get creative in the ways they work with businesses outside the industry.

Retailers are also equipping store associates with mobile devices that make customer data and insights accessible. That means employees can engage store shoppers as they enter physical locations and quickly support online shoppers who have questions about merchandise or returns. 

Retailers will build new partnerships in new ecosystems

The supply chain challenges and labor shortage in 2020 inspired retailers to get creative in the ways they work with businesses outside the industry. In 2022, we predict they’ll further demonstrate their willingness to innovate by partnering with companies outside traditional boundaries. 

Formalize relationships with new last-mile players

Getting merchandise to customers as promised is crucial to winning. Retailers will strengthen their relationships with last year’s delivery services or even take it over themselves, as did Amazon and Walmart.

Bring sourcing and manufacturing closer to home

After 2020’s port slowdowns, it’s no surprise that retailers are taking a fresh look at moving sourcing and manufacturing to the United States

Add sustainability as a value

Retailers are facing pressure from stakeholders far and wide to cut emissions faster. Look for them to partner to find profitable and differentiated ways to achieve net zero goals.

These retail predictions herald the beginning of a golden age of shopping for customers and retailers. With leading companies already mastering innovations like social commerce and personalization, it’s only a matter of time before emerging strategies born in Web 3.0 (a decentralized version of the internet where users have more control over their data) set the new brand experience standard.

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Alex Drinker
Alex Drinker

Alex is currently the vice president and global head of the Retail Industry Advisor team at Salesforce. Prior to joining Salesforce he served as the CMO for Shinola, where he helped cultivate and direct the brand narrative and work to spearhead a massive digital transformation for both Shinola and its sister brand Filson. Before Shinola, Alex worked at GE, where he served as the global director of partnerships and product innovation, which managed the $1B licensed goods business globally. He has also held leadership roles at GSI Commerce and ShopRunner.

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