4 Consumer Trends You Need to Know Now
Consumer trends come and go, yet the value of how they impact retail remains the same. JDA recently conducted a survey of more than 1,000 consumers to explore how some of retail’s latest trends are influencing consumers. The core findings of this survey revealed that:
- Sustainability is driving shopping patterns: Over half of those surveyed stated that they would be very likely to purchase products that are considered environmentally friendly or sustainable compared to other products. It’s clear that sustainable business practices – and supply chains are a must for organizations today.
- Gen Z and Millennials prioritize sustainability most: Shopping at retailers with environmentally friendly or sustainable products is more of a priority for younger demographics with 27% of respondents between the ages of 18-38 saying they’d be extremely likely to shop with a sustainable retailer, compared to 17% of respondents ages 30-44 and 15% of respondents ages 45 and over-60. This should stay top of mind for retailers considering the generations born after 1981 are more than double the size of the population of Baby Boomers.
- The jury’s out on the everyday clothing rental service, with special occasion still the number one category for rentals: More than a quarter of respondents (27%) would consider using clothing rental services for everyday wear, yet only 13% are currently using services for this category.
- Open-air concept malls are growing popularity: Respondents were more likely to visit open-air shopping centers versus indoor shopping: 22% shopped at outdoor shopping centers at least once a month, while 20% shop at traditional indoor malls at least once a month.
- Instant gratification is (still) king: When asked about the top two reasons they are more likely to shop with retailers that have physical stores, respondents said it was so they could see, touch, feel and try out items (89%) and take them home immediately (58%).
1. Sustainability Benefits the Planet and Customers Alike
Reinforcing the importance of sustainability, 50% of survey respondents indicated that they are very or extremely likely to purchase products that are “environmentally friendly” and/or “sustainable” compared to other alternatives.
The findings are slightly lower when asking respondents just about softline products, with 45% saying that they are likely to shop at a clothing/apparel retailer that has “environmentally friendly” and/or “sustainable” products, compared to other alternatives.
In addition to selling environmentally friendly apparel, respondents are concerned about how products are being made and the sustainability of retailers’ supply chain. Notably, this was true across all age ranges. Recently, fast fashion retailer H&M announced it would begin including individual supplier details for items on its website, including the country, supplier names, and factory names, in order to increase transparency for consumers. Our survey found that more than half (52%) of respondents are very or extremely likely to shop at clothing/apparel retailers that are transparent about how their products are produced, compared to other alternatives.
2. Clothing Rental Services Introduce Revenue and Retention Opportunities
Supporting sustainability is just one of the benefits that clothing rental services provide. These programs also help retailers – including Urban Outfitters, American Eagle and West Elm in partnership with Rent the Runway – strengthen new revenue streams.
Of the roughly 25% of respondents that have used a clothing rental service, the majority (76%) use it for formal or special events (e.g. wedding, prom, etc.). Similar to sustainable habits, there is more popularity around rental services from younger generations with 35% of respondents ages 18-29 having already used it, compared to 27% ages 30-44, 24% ages 45-60 and 12% of respondents ages 60 and over.
When looking at different rental service categories, 23% of all respondents would consider using home furnishing rental services after hearing about recent news like the Rent the Runway’s partnership with West Elm. Similarly, 27% of all respondents would consider using rental services for everyday wear after hearing about Urban Outfitters’ announcement to provide these services.
Incorporating rental programs into the retail model is a refreshed way to increase customer retention. But the key to the growth in this service, of course, is to create rental services that capture customer attention and need.
3. Open Air vs. Indoor Shopping Centers Influence Customer Experiences
Whether you are an indoor shopping center fan or prefer outdoor retail destinations, our survey revealed that experiences matter when it comes to choosing where you shop. The top two factors influencing customers to shop somewhere more frequently were having unique dining options (46%) and grocery shopping, such as Whole Foods or Trader Joes (42%). Following closely behind in third place was the convenience of services from shopping at a physical store, including buy online pick up in-stores (BOPIS) or curbside pick-up with 41% of respondents identifying this as a factor in influencing their shopping decisions. Live music (19%) and fitness facilities (6%) were also contributing factors, which New York’s Hudson Yard demonstrates well in their recently opened center.
4. E-Commerce Merchants Opening Physical Stores is a Reaction from Consumer Insights
Convenience is key for customers, which is why online shopping has made such an impact on commerce-at-large since it first was introduced. Yet customers like choices and there is no better example of this than the trend of e-commerce merchants such as Amazon, Warby Parker, Casper and Allbirds – all who originated and grew in popularity as online merchants only – opening physical stores across the nation.
This tells us that valuing customer preferences is vital, which includes an overwhelming majority of customer respondents (89%) who prefer to see, touch, feel and try out items as part of their purchase experience.
When retailers consider consumer factors in their operational decision making, they help align themselves with more customer-centric strategies that support modern trends within the retail landscape. These collective actions have the opportunity to influence revenue, increase retention and provide less reactive, but rather proactive strategies for retailers to benefit from. As a result, this also helps retailers build brands that can survive generations versus just exist within a few trendy moments.