The more you know about the current characteristics and attitude of consumers, the better equipped your brand is to market effectively and attract more sales. In an increasingly digital and global world of commerce, retailers need to stay on top of the latest trends and behaviors.
Household budgets shift and disposable income amounts change in times of economic instability. Cost pressures squeeze out luxury interest in some demographics. However, you can still profit from consumer spending momentum if you know where to focus your efforts and resources.
1. Consumer spending is up across the board for 2024
As disposable income sneaks up, American consumers also increase spending. In the past year, it’s risen from $15.5 billion to $15.7 billion in the first quarter.
Although many factors go into this, including rising prices for consumer goods in general, it shows that people still have money to spend. The continuous upward trend in economic activity refutes anecdotal tales of a drop-off in retail shopping. If you market effectively, you can get a piece of the pie.
2. Essential spending and practical products top the list
Consumer confidence has taken a blow in the last year, and more people across demographics spend their money on needs rather than wants. Numbers show a 77% reduction in non-essential purchases in a study of over 7000 respondents.
However, always keep your audience in mind, particularly those of different personal income or wealth levels. If you represent a luxury brand, these unfortunate changes will have a much smaller effect on overall sales.
3. Omnichannel (including in-store) experiences fuel sales
The vast majority of people in America, and around the developed world, have bought something online in the past year. However, similar numbers still buy things in brick-and-mortar shops on a regular basis. People will research products online, read reviews and product specifications, and then go check things out in the store for the final purchase. This phenomenon, known as webrooming, has increased in popularity.
However, some shoppers will do the exact opposite: showrooming. They enjoy the physical connection and tactile experience of in-store shopping before they make a final decision at home on the internet.
And there’s BOPIS orders: buy online, pick up in store. The COVID-19 pandemic made this trend popular, but it’s stuck around long after the lockdowns ended. 60% of buyers have paid for a purchase online and picked up the items in person.
These diverse consumer behavior trends demonstrate the importance of omnichannel marketing and phygital integration. Create a brand feeling that seamlessly flows between the real and virtual worlds.
4. Social shopping hits an all-time high
If you target younger demographics in the lower millennial or Gen Z generations, you don’t want to skimp on your social media presence or marketing. Platforms like Instagram, TikTok, YouTube, and others provide the perfect ecommerce platform for tech-savvy consumers. In fact, 73% of the 18 to 34-year-old market are more likely to discover a product through social media than through any other channel.
Combined with trending data on using social media for product recommendations, you can assume user-generated content is especially important. Influencers and the brands themselves see short posts and eye-catching graphics as a major component of their strategies.
5. User-generated content builds trust
User-generated content, or UGC, is another important element of building customer trust. Statistics that support this claim have bounced around the retail world for a while. Recent numbers show that 78% of consumers gain confidence when they see a shopper or buyer leave a review of something they’re interested in.
This can also play into the desire for social proof and support of their choices. Most people, especially those who enjoy luxury brands, want to feel like they’re following the crowd and are up on today’s most popular trends.
6. Email remains one of the most effective retail marketing avenues
When it comes to straight ROI, email still comes in near the top of the list. At the end of last year, numbers showed $36 revenue for every dollar spent. While this impressive stat doesn’t focus solely on retail, all other details like click-through-rates, open-rates, and similar general data points remain high.
Retailers should use opt-in email in conjunction with a strong social media presence and SMS marketing to encourage client communication and relationship building. Both email and text have a major benefit of working well with personalized marketing efforts if you segment your list well.
7. Young consumers appreciate BNPL convenience
Buy now, pay later platforms and bank services are growing in popularity, with 38% of consumers opting for this money management style.
Dynamic financial conditions make it more attractive than debit cards and credit cards, especially to Gen Z and millennial shoppers. Middle-income consumers tend to use plastic to pay right away in more traditional methods for online or in-store purchases.
8. Shipping costs, transparency, and simplicity matter
Consumer demand for an easy online shopping experience extends to shipping. Delivery speed wasn’t as important as cost. Among online shoppers, 78% will buy more items to get free shipping. Many would abandon a full shopping cart if the logistics charges ended up higher than expected.
Unfortunately, supply chain and last-mile shipping rate hikes have occurred across the board. Focus on transparency and trying to make it seem like they’re getting a great deal above all else.
9. Shoppers welcome AI assistance
Consumer spending habits point to tech acceptance as a huge part of the shopping and buying process. New technologies like artificial intelligence are rapidly taking over for less personalized and easy-to-use methods of the past. As it improves, people get more comfortable with it. A full 76% welcome these types of smart virtual assistants.
This shows great promise for forward-thinking brands who look to interactive customer care methods. Focus on business trends that incorporate advanced tech with the expectations of personal service.
10. Augmented reality helps convince the curious to buy
Alongside smart AI helpers, augmented reality (AR) is getting a consumer sentiment boost for people who prefer to shop at home instead of browsing shops for the perfect item. This is especially true in the fashion industry, where 30% of consumers say they’d use AR apps to try on clothes virtually before choosing their next favorite outfit.
The ability to test products in every way but physically makes them more enticing to younger demographics. This makes augmented reality a definite ‘yes’ on the phygital shopping experience checklist.
Conclusion
Now that you have the latest statistics on consumer retail spending across the board, you need to look closer at your specific target audience. Clientbook offers expert capabilities when it comes to the collection and analysis of retail data. With this tool on your side, you can empower your personalized marketing efforts and get the results your brand needs to thrive. Book a demo today to see it in action.
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