We are in what we like to call “prediction season”. It is the wonderful time of year when the retail prognosticators come out of the woodwork and provide their ‘expert’ points of view on what will happen in the next year.
The Prediction on Predictions: Honestly, we absolutely love and enjoy all of the predictions and POVs (I read over 50 of them just for this article) but our prediction, on predictions, is that these ‘soothsayers of sales’ will be much more wrong than right for the foreseeable future (including us). But that is absolutely more fun anyway.
The predictability of the future is the most overhyped trend out there. COVID threw the retail world a curveball and the trickle down effect of this life altering event will be long felt; obvious in some places but subtle in others. We are 100% going to join in the fun and give our predictions for 2022 as well!
WARNING! this article is a touch on the long side so top off your coffee (or your beverage of choice), find a comfortable chair and enjoy! The TOC below should allow you to pop around to what you find most relevant. Table of Contents
First, we will summarize what we read from the experts.
An audit of the 2022 predictions.
On RetailWit we have a category called “Trends & External Forces”, which looks at forces (current and future) impacting retail & manufacturers; these trends are subdivided and categorized into eight different sub-categories (see below). Additionally, there is a tag called “Predictions & Forecasts” that specifically captures articles that speak to predictions—this tag alone currently has over 2,700 articles! Obviously people like to pontificate about the future and we really enjoy reading them.
So, we dove in and pulled out what we believe are the most talked about predictions & trends and provided our unique RetailWit perspective on them. We hope you enjoy!
Reviewing the past year, our top trending category was ‘Trends in Retail’, which isn’t overly surprising since we are RetailWit. But there were also a significant number of articles regarding shifts in technology, consumer and marketing trends.
In reviewing the data and diving into the top 50(ish) predictions, articles and white papers we found and reviewed a total of 178 predictions for 2022. That is just too many so we did the work for you, and rolled them up into 65 trends (within our Trend categories) and then finally consolidated into the top ten.
Let’s build this bottom up and look at the 8 categories of predictions. The table of contents above allows you to pop around to the categories you find most interesting.
Retail Trends and Predictions:
Prediction: The pendulum swings back to physical retail this year.
“shopping is one of Americans’ greatest pastimes” - Shelley E. Kohan
Retail Trends to watch in 2022
- Physical retail (Brick & Mortar)
- SWAS (store within a store): Malls aren’t dead they just shrunk and are now in individual retailer stores.
- Retail Theatre: “Retailtaiment’ and engaging merchandising enabled by data and new technologies.
- Phygital Retail: A seamless omni commerce shopping experience.
- Distributed commerce: Doing commerce outside of traditional Brick and Mortar and ecommerce ecosystems.
- QCommerce: Quick Commerce or Rapid Delivery (in 30 min or less)
- Transparency & Visibility: Providing shopper visibility into pricing, out of stock and improved substitution science.
- Associate engagement: Automation, new technology and data will free up the store associate to engage shoppers in a more meaningful way.
RetailWit Take on Retail Trends & Predictions
"The purpose of a store continues to evolve” - RetailDive
There is a large swing back to Physical Retail and it’s role is fast evolving. As has been said, physical retail isn’t dead – bad physical retail is dead. There are major issues to address in 2022 around supply chain and labor shortages that we predict will continue to take over the majority of retailers focus, time, and energy. This year may appear low on buzz as retailers must get their back rooms and operations in order. Additionally, Retailers did an amazing job pivoting during COVID but much of that was done via brute force. This year, leading retailers will automate and find efficiencies into those now permanent processes and procedures.
Consumer Trends and Predictions:
Prediction: Do good for yourself, your circle and the world.
Consumer Trends to watch in 2022
- Health and Wellness: Health(ier) in Mind and Body.
- Inner Circle: Family and close friends.
- Time Redefined: People are redefining when they do what activity, including shopping. The concept of 9-5 has changed.
- ESG (Environmental, Social, Governance): Consumers are looking for and buying from companies that have purpose aligned with their own beliefs.
RetailWit Take on Consumer Trends & Predictions
Consumers are looking for authenticity and transparency for products they consume as well as from where they buy them. They are highly attuned to see and punish those that are “GreenWashing” or “not walking the walk” for D&I. It is also important to understand the concept of time is adjusting as locations and work schedules are becoming more flexible; the 9 to 5 is no longer. Note that Health & Wellness again popped to the top of predictions, but it always does (it is January). The important nuance is a high level of focus on mental wellbeing as well as ‘doing better’ vs. ‘going for perfection’.
Finance Trends and Predictions:
Prediction: Moving from meme stocks to solid fundamentals (somewhat)
Finance Trends to Watch in 2022
- BNPL: Buy Now Pay Later
- Crypto: Crypto / Web3 / Blockchain / NFTs
- Financial Acumen: Better oneself financially both through better education but also by commercializing a side gig or hobby.
- SuperApps: Apps providing multiple services (financial, social, shopping, entertainment, health) on a single platform for personal & commercial life.
- Inflation: of course inflation
RetailWit Take on Finance Trends & Predictions
If a SuperApp (which we believe is likely to happen but likely not in 2022) comes to fruition it will be a game changer. Many predict fintech will figure it out first. The prediction we are most hopeful for is the shifting desire away from ‘get rich quick schemes’ like Meme-Stocks, Crypto currency & day trading on Robinhood to people wanting to build their own education and financial acumen.
Food & Bev Trends and Predictions:
Prediction: Unique twists (on food and farming) and moderation
Food & Beverage Trends to watch in 2022
- Frozen foods continuing momentum: unlike other categories the lift during COVID seems to be maintaining momentum
- Low or no alcohol: Continued hot trend well beyond “Dry January”
- Blurring beverages: Adult and traditional beverages continue to get into each other’s turf via innovation or partnerships.
- Traditional cultural dishes: Food focused on culture and global cuisine.
- Sparkling expands: From cultural to functional beverages.
- Superfoods move to new forms: Like pancakes!
- Reducetarianism: Not ready to go completely Vegan or Vegetarian, people are now consciously moderating.
- Ag tech: Alternative farming, urban farming, vertical farming, hydroponic farming, and autonomous tractors.
RetailWit Take on Food & Bev Trends & Predictions
Beverage is the space to watch this year with low/no alcohol and the blurring lines between adult and traditional beverages. There is also a lot to watch in Agtech which we hope / believe will have a large impact but likely not in 2022. As an example recently Walmart invested in Plenty Unlimited Inc., an indoor vertical farming company. Additionally, an innovation that recently caught our eye is John Deere just announced an autonomous tractor at CES.
Marketing Trends and Predictions:
Prediction: New toys and distractions overshadow a huge shift.
Marketing trends to watch in 2022
- Accelerated changes in Media Consumption: From Streaming to Creator driven to partnership; how, where and why media is consumed is significantly changing. This will have a major impact how marketers spend advertising budgets.
- Did you know that Tiktok surpassed google this year as the most visited app/website? Take a second to let that sink in… surpassed GOOGLE!
- Retail Media has another big year but becomes slightly more reasonable: Supply and demand has driven CPM through the roof but as many many more retailers offer retail media, and current operators release more inventory that curve will change. Manufacturers are also demanding performant media. The benefit of Retail Media can also be the curse, the ability for granular results assessment. The growth will continue but so will the scrutiny.
- Rise of “brand advocacy”: A shift from advertising to brand building through a return focus on loyalty and brand advocacy.
- Martech: There are exciting new platforms but also there are a plethora to manage; that is causing complexity and inefficiency.
- Permission based marketing: 3 shifts are causing a need for brands to need to shift attention; the need for, and ownership of, first party data, death of cookies, and Cyber Security & Privacy demands.
- ESG: Purpose & inclusivity powers marketing trends in 2022.
- Demographic focus change: Another interesting insight / prediction is that the pendulum swung too far focusing on Millennials and Gen-Z mostly because the pendulum swung too far on ecommerce and the misbelief that older generations aren’t shopping there.
- Buzzy new toys: NFTs, AR/VR, MetaVerse, etc. have a lot of noise around them but are unproven.
RetailWit Take on Marketing Trends & Predictions
2022 is going to see some pretty major shifts in marketing due to new capabilities, new platforms but more due to changing behaviors, expectations and demands of consumers and shoppers. We predict a B2B Superapp being created to manage the enormous number of platforms being created, but likely that won’t be in 2022. Marketers should absolutely test new tactics, environments and platforms but don’t become overly enamored with the cool and new and the cost of driving your business.
Shopping Trends and Predictions:
Prediction: Follow the boy scout motto, “Be Prepared”
Shopping trends to watch in 2022
- Anytime / Anywhere / Anything: The P2P has permanently changed, it is barely a path anymore. Google called it the ‘messy middle’ and shopping can happen anytime / anywhere to buy anything. One trend coming out of COVID is the shifting ‘work week’ which means that the traditional spikes when people are on their way to work, on lunch, or on their way home no longer are the spikes of old.
- ESG: Consumers are now really looking at manufacturers who stand for the same things they do for, that is moving in to shoppers and wanting to shop with and buy from retailers who stand for what they do as well.
- Distributed Commerce: We are just at the beginning of being to purchase outside of traditional places (Brick and Mortar or retail ecommerce) for example having the buy now button move to social platforms (like TikTok).
- Revenge buying moves to Revenge shopping in physical retail: Shopping and Browsing in physical retail is coming back in a big way as people want be in the ‘real world’ once again and away from screens.
RetailWit Take on Shopping Trends & Predictions
Retailers must ‘be prepared’ for the triple A’s:
- The Triple A’s
- Anytime: the traditional spikes (before and after work, weekends, etc.) in shopping are going to be smoothed out as the traditional 9-5 workday changes (for white collar).
- Anywhere: this goes beyond where a shopper is physically, it also goes to where they are digitally, distributed commerce puts ‘shopping’ beyond traditional places (physical retail and ecommerce)
- Anything: It is moving towards retailers, through marketplaces or partnerships, selling pretty much everything.
- Distributed Commerce: Without a doubt TiKTok, and other social media companies, as well as other non traditional channels, have the potential to drive commerce success, but it won’t be in 2022, which will be the year of the test and learn where many Retailers and Manufacturers will dip their toe in.
Technology Trends and Predictions
Prediction: Bet on boring in 2022
Technology trends to watch in 2022
- Automation: Investment in automation continues to rise in 2022, much will be the work ‘behind the scenes’ and won’t get the fanfare of splashier technologies but will have a larger impact.
- Cybersecurity: “One group of people follow the industry as closely as analysts, that is criminals and they are seeing and targeting the growth of ecommerce.”
- Regulation: “Congress will host a demolition derby of conflicting proposals for regulating powerful social media companies”. Tech dealmaking will face significant headwinds due to regulatory pressure. The government is watching, from the FTC to the DOJ.
- Web3: 2022 will officially end the debate over whether blockchain and Web3 is a meaningful pillar for the future of technology or just hype.
- Metaverse: Next big thing or next big fad. “It is simply a great rebranding from AR/VR to Metaverse” – Ben Evans
RetailWit Take on Technology Trends & Predictions
A lot of excitement and buzz comes out of CES every year with minimal true world impact. The technologies that are going to have the greatest impact on our industry this year are more ‘backroom’, logistics, security, automation, and supporting technologies. It won’t be drones, autonomous vehicles or the Metaverse. It will be things like predictive supply chain or personalization science. But we still love the cool stuff!
Manufacturers Trends and Predictions:
Prediction: Shortages drive new strategies & structures
Manufacturer Trends to watch in 2022
- Shortages (supply chain & labor): have caused a critical new eye on automation, information, partnerships and processes. It is important to note that labor shortages don’t stop with plants, warehouses & drivers it extends to “white collar” HQ jobs as well.
- Executive Changes: Tremendous turnover, restructures and the role of the CMO has permanently changed – it is predicted that the role will change from CMOs into CX leaders.
- ESG: Leading manufacturers will move quickly into authenticity and focus on the breadth of ESG as shoppers / consumers want not to just know about the products they are purchasing but from what company – do their belief structures align?
- Retailer Exclusivity: the days of the same product sitting on every shelf in America is changing as retailers, looking for traffic drivers and loyalty are looking for exclusives and leading CPGs are starting to comply and see benefits from exclusive products, packages or flavors either temporarily or permanent.
RetailWit Take on CPG (Manufacturers) Trends & Predictions
The manufacturers (CPGs) like retailers have felt the immense challenges with supply chain and labor shortages and leaders will shift their strategies, plans and structures to align with this new reality of blurry lines between consumers, shopper and retailer expectations. Agile will be the key to success; those with long lead times and inflexibilities simply won’t succeed.
Summary of Predictions
- Retail: The pendulum swings back to physical retail this year
- Consumer: Do good for yourself, your circle, and the world
- Finance: Moving from meme stocks to solid fundamentals
- Food & Bev: Unique twists (food and farming) and moderation
- Marketing: New toys and distractions overshadow a huge shift
- Shopping: Follow the boy scout motto: “Be Prepared”
- Technology: Bet on boring in 2022
- Manufacturers: Shortages drive new strategies & structures
THE TOP 10! Bringing it all together
Methodology: We took all of the predictions from experts and bounced them against our database to determine the top 10 predictions and determined which ones are overhyped vs underserved based on the data.
First let us say that this grid is about impact in 2022 so things labeled ‘Overhyped’ doesn’t necessarily mean they won’t have a big impact eventually, just not in 2022 and those classified as ‘Status quo’ means nothing meaningfully more impactful than previous years.
Overhyped: Not surprisingly the more buzzworthy and ‘cool’ trends fall here; the media likes to only cover those. Our belief none of these will have a material impact this year; except on the cost line in the income statement. But with that being said having a budget to test and learn is a smart strategic investment.
Status quo: Only one fell in this bucket, Health and Wellness – this continues to be a talked about topic but our prediction is it will continue to have similar impact as previous years, no more – no less.
Overlooked: We have come a long way from the ignorant days of the ‘retail-pocalypse’ but this coming year physical retail, particularly purposeful and compelling retail is coming back in a big way. The labor shortage is also driving some important conversations around associates and recognizing and rewarding them appropriately. Additionally exploring automation to take away some of the more menial tasks freeing associates to engage customers and make a meaningful impact. Lastly, ESG made it’s way into every category, it is no longer a nice to have and sitting on the cost side of the balance sheet, it can and will impact the sales side (potentially positive or negative).
The next big thing: While Retail Media is riding the line between “Overhyped” and “The Next Big thing”, with Amazon breaking it out for the first time in their last earning call, no doubt others will now push it even harder seeing that huge number. Delivery, which should surprise nobody, also sits in this bucket. Lastly, one that was close to being overlooked is Cybersecurity and privacy which more and more consumers and shoppers are paying attention to.
RetailWit Predicts 2022:
Merchandising gets it groove back
Merchandising has always been a balancing act of art and science with the pendulum swinging far to the data side over the past several years. We predict leading retailers will swing it back appropriately to a better balance of art and science. Leading merchants will have to return to making decisions without perfect data or 100% confidence and return to having the courage in trusting their experience and using their gut to take a few educated risks, leaning towards fast to action & quick test and learns to gain first mover advantage.
Over the past couple years the industry became almost immobile due to risk aversion. Data and analytics are supposed to be a tool and enabler for better decisions and for many it became a crutch or an excuse for inaction.
One of the few benefits of COVID was it forced many to accept some level of risk and drove action. Leading retailers and manufacturers will embrace the risk and trade 100% confidence for first mover advantage.
The future favors the bold
The retail industry demonstrated that they can innovate and pivot quickly but it is just a shame it took Covid to make it happen. Over the course of the next couple years there will be two camps:
- Those who embrace and institutionalize the agile mindset & process changes
- Those that fall back into old ways, lose their nerve and go back to long pilots and tests before moving forward or fall back on ‘wait and see’ or ‘fast follow’ mindsets.
We predict this year it will be telling which of the two camps retailers end up in and performance in 2022 will highly corelate to those decisions.
Our specific LOOONG Shots:
- Instacart gets bought: Already leading the delivery industry by far; Instacart was given the golden ticket called COVID19 and had the opportunity to solidify (potentially permanently) it’s leadership position by doubling down on it’s core capabilities, instead it took its eye off the ball and focused too much on selling advertising. Don’t get us wrong – advertising is a big bet and needed to drive profitability in this space but they seemed to move their focus to that vs. adding it to their strategy. There is a flywheel between retail sales and retail media and Instacart, bringing in two Facebook media executives, over played that hand, with one only lasting a couple months. So as they stumble their valuation goes down. Couple this with a labor shortage and the ROI on acquiring the technology, contracts, 12,000+ Instacart employees as well as over 100,000 gig workers in one acquisition seems to be a sweet opportunity. Our bet is on Walmart, with their focus on delivery and announcement to hire 30,000 new drivers, it seems starting with a pool to convert is a smart play. They are already tested the waters with Walmart delivery and a couple retailers already bit, so they could put the major screws to their competitors and solve many business problems all in one major acquisition.
- qcommerce stumbles: We predict this year that there will be less players coming out of 2022 than those going in, either by acquisition, mergers or simply by running out of funding. The financial model for 15 min delivery is tough (if not impossible) to do profitability. Even in tight urban environment qcommerce companies are struggling to become profitable and much of the US isn’t a tight urban environment. Many of the players are now trying to supplement the business model through “alternative profit” like advertising, financial services (BNPL) or by selling private label brands. Our opinion is there is high demand but qcommerce is a smart bolt on to an already successful B&M business but likely can’t stand on it’s own, so we predict some traditional retailers as acquirers and or leading players backward integrate and purchase B&M as GoPuff did when they purchased Liquor Barn and BevMo.
- For more; Brittain Ladd wrote a great opinion piece on how how “New York City Is Killing Rapid Grocery Delivery Companies”
Even Crazier Long Shots
- A traditional CPG buys a B&M retailer: As retailers become brands (private label) and brands become retailers (D2C) and it has become obvious that omnicommerce (physical w/ digital) is truly the only recipe for success what is stopping a traditional CPG from buying a retailer? There are some obvious competitive issues but with the growth of frenemies in this space it is more likely now than ever. Our money is on PepsiCo or GMI.
- An entertainment SUPERapp is created: We predict by the end of 2022 someone buys Spotify to create an entertainment SuperApp, our prediction is Netflix or Disney
- THE Amazon disrupter finally emerges: It has long been said that “Amazon perfected buying and ruined shopping”. It isn’t just Amazon, the ecommerce shopping experience is utilitarian and not differentiated for anyone. What we forget is people like shopping, so when will there be a new to the world digital shopping experience developed and it absolutely will not be via the MetaVerse. Nobody wants to play a video game called ‘lets go grocery shopping’ – It is entirely possible that Amazon disrupts itself by building or buying technology but we are due for something new in shopping. Remember the much debated “Anticipatory Shipping” that Amazon patented several years ago? (it was in 2014) what ever happened to that project? Shopify has to have something brewing but we are betting it comes from somewhere more unexpected like Salesforce or Microsoft.
Overall, we predict 2022 will be a pivotal year in retail and the gap between those who are bold & courageous vs. retail followers will widen.
You made it to the end! Congratulations!
PS. We are more than happy to share the total list of predictions, just shoot us an email.
Thank you for reading!
We welcome comments, feedback and debate! On the site, on LinkedIn, on Twitter or email us at [email protected].
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