Now that was a revolutionary year in retail. As 2020 winds down, it’s time to revisit my 2020 Retail & CPG Trend Predictions so consumer packaged goods (CPG) brands and retailers can consider market factors that could affect their 2021 business plan. Sure, these predictions missed the whole global pandemic, tectonic shift to digital, and socioeconomic upheaval but, otherwise, my retail trendspotting wasn’t too shabby.

Prediction #1: Social Commerce

social commerce

Verdict: Retail leaders and tech titans are entwining e-commerce and social media to make online shopping more entertaining and interactive.

Although social commerce is still in its infancy in North America, a recent survey found two-thirds of Generation Z consumers had made a purchase on social media.1Jibilian, Isabella. ‘A whole new baseline in digital shopping’: Orders from social media sites increased 84% in the third quarter, according to a new report. Business Insider. November 13, 2020.

Social commerce in 2020:

  • Shopify and TikTok moved social commerce forward with their new global partnership, which will prepare the companies to add in-app features like shoppable video ads.2Perez, Sarah. TikTok partners with Shopify on social commerce. TechCrunch. October 27, 2020.
  • Facebook launched Facebook Shops and partnered with e-commerce platforms Shopify, Big Commerce, and WooCommerce, and welcomed big players like Sephora and Target.3Ha, Anthony. Facebook and Instagram roll out Shops, turning business profiles into storefronts. TechCrunch. May 19, 2020.4 Walk-Morris, Tatiana. Target to sell products through Instagram Checkout. Retail Dive. May 22, 2020.
  • Instagram, which Facebook owns, recently moved its Shop button to the app’s homepage, putting social shopping front and center.5Carman, Ashley. Instagram redesigns its home screen for the first time in years, adding Reels and Shop tabs. The Verge. November 12, 2020. It also launched Live Shopping for livestream videos with a click-to-buy feature.6Waters, Michael. As big tech goes all in on live-stream shopping, the future may be for small brands. ModernRetail. November 23, 2020.
  • Amazon invested in 2020 Prime Day marketing campaigns on Amazon Live, its livestreaming platform for interactive, real-time video shopping, as we’ll see in the next trend.7Masters, Kiri. Amazon Live Video Shows Us The Future Of E-Commerce. Forbes. November 16, 2020.

Prediction #2: Marketing Influencers

marketing brand influencers on social media

Verdict: Many high-profile personalities persuaded consumers to shop.

Proof: Vogue calls influencers “the retailers of the 2020s” for their sales power and persuasion, which fuel product discovery and brand trust.8Farra, Emily. Influencers Are the Retailers of the 2020s. Vogue. October 19, 2020. Consumers increasingly seek influencers’ opinions of cooking, beauty, and home renovation products, to help them make purchase decisions.9Masters, Kiri. Amazon Live Video Shows Us The Future Of E-Commerce. Forbes. November 16, 2020. That’s why 65% of influencer marketing budgets will increase this year.10Wertz, Jia. 3 Emerging E-Commerce Growth Trends To Leverage In 2020. Forbes. August 1, 2020.

Marketing influencers in 2020:

  • Amazon announced Prime Exclusive Deals to its network of influencers during Prime Day so they could create live video content with featured products to share on Amazon Live.11Masters, Kiri. Amazon Live Video Shows Us The Future Of E-Commerce. Forbes. November 16, 2020.
  • Lowe’s collaborated with 18 influencers for its “Letters to Home” campaign to inspire consumers to give thanks for their homes – and show them some love with snazzy new décor.12Monllos, Kristina. ‘Everyone is grasping for nostalgia and happiness’: Why marketers are ringing in the holiday season with more influencers. Digiday. December 2, 2020.
  • Under Armour partnered with NBA superstar Steph Curry to launch Curry Brand, a new line of footwear, apparel, and accessories, as fitness is fashionable during the pandemic.13Howland, Daphne. Under Armour, Steph Curry launch brand. Retail Dive. December 1, 2020.
  • Gap signed a 10-year contract with rapper Kanye West for a collaborative line called YEEZY Gap to reinvigorate the apparel chain, and extend its reach and relevance.14Sehdev, Jeetendr. A Billion Dollar Celebrity Partnership? Kanye West And Yeezy Announce A 10-Year Deal With Gap. Here’s Why You Should Pay Attention. Forbes. June 26, 2020.
  • Uber Eats hired Star Wars’ Mark Hamill and Star Trek’s Sir Patrick Stewart to help the food delivery brand compete against food apps, grocers, and CPG rivals for consumers’ share of stomach.15Guy, Jack. Patrick Stewart and Mark Hamill go head-to-head in food delivery commercial. CNN. September 22, 2020.

Prediction #3: Speed

fast delivery services

Verdict: Yes, indeed, consumers seek speed.

As consumers desire time-savings, buy online pick-up in-store (BOPIS) orders rose 208% year-over-year in April.16Berthene, April. Online sales jump 49%, BOPIS grows 208% amid coronavirus pandemic. Digital Commerce 360. April 29, 2020. We’re impatient online, too: if a retailer’s website loads too slowly, 57% of consumers go to a rival retailer and 21% never return to the site.17Walk-Morris, Tatiana. Report: When sites load too slowly, 41% of shoppers head to Amazon. Retail Dive. August 19, 2020.

Retail speed in 2020:

  • Walmart, Sephora, Staples and 7-Eleven all partnered with Instacart to offer same-day delivery as more consumers shopped online.18Loeb, Walter. Walmart Takes A Smart Step By Teaming Up With Instacart On Delivery. Forbes. August 12, 2020.19Redman, Russell. Instacart goes outside grocery again with Sephora partnership. Supermarket News. September 24, 2020.20Walk-Morris, Tatiana. Staples introduces same-day delivery via Instacart. Retail Dive. June 15, 2020.21Keyes, Daniel. Instacart is starting to offer same-day delivery from 7-Eleven stores. Business Insider. September 3, 2020.
  • Target’s same-day services (Pick Up, Drive Up, and Shipt) rose 273% in the second quarter.22Unglesbee, Ben. Target posts blowout Q2 with help from 273% growth in same-day services. Retail Dive. August 19, 2020.
  • Amazon partnered with Lyft for e-commerce delivery, including grocery delivery to keep food fresh.23Kerr, Dara. Lyft partners with Amazon on package and grocery deliveries. CNET. March 27, 2020.
  • Whole Foods added dark stores, which are closed to shoppers to speed up urban online fulfillment.24Kerr, Dara. Lyft partners with Amazon on package and grocery deliveries. CNET. March 27, 2020.
  • H-E-B is investing in robotics and microfulfillment centers to accelerate e-grocery order picking.25Silverstein, Sam. H-E-B jumps into micro-fulfillment. Grocery Dive. September 15, 2020.

Prediction #4: Subscriptions

subscription box services

Verdict: The allure of consumer convenience and recurring revenue fuelled subscription services.

The pandemic drove 20% of consumers to subscription services for household staples.26Suryanarayanan, Karthik. How the subscription commerce model is driving a DTC retail boom. The Future of Commerce. August 10, 2020.Experts predict that by 2023 up to 75% of direct-to-consumer (DTC) brands will offer subscriptions.27Ibid.

Retail subscriptions in 2020:

  • Walmart launched the new Walmart+ subscription, which gives subscribers unlimited free deliveries from stores with no minimum order requirement on next-day or two-day shipping, including groceries and household essentials.28Vincent, James. Walmart tries to undercut Amazon Prime with cheaper subscription service. The Verge. September 1, 2020.29Perez, Sarah. Walmart+ takes on Prime by dropping $35 minimum on purchases. TechCrunch. December 2, 2020.
  • Amazon teamed up with small businesses, including specialty food retailers, to grow its existing subscription box program to spark product variety, repeat purchases and loyalty.30Waters, Michael. Why Amazon is turning to small brands to grow its subscription box program. ModernRetail. November 5, 2020.
  • Bean Box, a Seattle-based coffee subscription brand, scored soaring sales for its artisan beans as more consumers work and brew at home this year.31Wallace, Alicia. Coffee drinkers are seeking out subscriptions and higher-end beans amid the pandemic. CNN Business. June 21, 2020.
  • Target is an exception to this trend, as it recently discontinued its subscription service because shoppers prefer the speed and flexibility of same-day service alternatives.32Patton, Leslie. Target Halts Subscriptions as Shoppers Opt for Same-Day Delivery. Bloomberg. November 13, 2020.

Predicted Trend #5: Pop-Ups

pop up shop retail shopping

Verdict: Temporary physical shops enticed customers with a taste of their assortments.

Hot and emerging brands launched short-term shops as low-commitment retail tests.33Belanger, Lydia. Pop-up retail was made for the pandemic. Fortune. June 25, 2020.

Retail pop-up shops in 2020:

  • Lululemon stores attracted lineups that snaked down the sidewalk during the pandemic. That’s why the yoga apparel giant opened 70 temporary seasonal stores to manage holiday demand amid capacity constraints.34Wilson, Marianne. Lululemon expanding holiday temporary stores. Chain Store Age. September 9, 2020.
  • Supergoop, a skincare brand, and inclusive lingerie brand ThirdLove opened pop-up shops to extend their brand reach into physical stores to get closer to consumers.35Belanger, Lydia. Pop-up retail was made for the pandemic. Fortune. June 25, 2020.
  • Threads & Company, a direct-to-consumer online boutique, took its collection outdoors with a parking lot pop-up shop that created a buzz.36 Parisi, Danny. The new pop-up: Brands are rethinking the purpose of a temporary store. Glossy. July 8, 2020.
  • Party City scaled back its pop-up plans with a 91% drop year-over-year in temporary physical shops due to pandemic-driven health and safety concerns.37 Barkho, Gabriela. Why Party City’s scaled back pop-up plan is a foreboding holiday bellwether. ModernRetail. September 25, 2020. Conversely, rival Spirit Halloween announced plans to open about 1,400 pop-ups, up 3% from 2019.38 Ryan, Tom. Is the Halloween retail opportunity becoming less scary? RetailWire. September 30, 2020.

2020 retail rewind

Despite a wonky year, these retail predictions came true. They also made one thing clear: Agility was the most critical success factor in 2020 for retailers and brands of all sizes. Additional 2020 retail trends that deserve attention include the e-commerce explosion, surging product returns and consumer demand for BOPIS, value and local products.

Stay tuned for 2021 retail trend predictions, coming in January. Happy holidays!

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