Retail and fashion brands are undergoing rapid change — with significant implications for their marketing technology. Here’s what we can expect this year.
2023 appears to be shaping up to be an interesting one, particularly for marketers in the retail and fashion sphere. With certain developments reaching a peak and new difficulties arising, technology needs to be front and center of all things marketing now more than ever.
With this in mind, let’s take a closer look at four trends that will bring change to retail and fashion martech in the coming months:
- Hyper-Personalization Becomes the Expectation
- The Pendulum Stays Firmly on the Existing Customers’ Side
- Social Commerce Is Going Mainstream
- From the Metaverse Back to Reality
Hyper-Personalization Becomes the Expectation
It’s certainly nothing new that consumers want to be treated as individuals. Impersonal bulk emails and recommendations completely at odds with our tastes and preferences are not likely to motivate us to shop, much less become loyal long-term customers.
In light of this, retailers and fashion brands have been striving to go beyond the one-size-fits-all approach in marketing in recent years and provide customers with a more personalized experience based on the demographic data they hold on their customers, such as name, birthday, or location.
As a result, consumers are increasingly demanding more personalization throughout the customer journey and companies need to follow suit. Employing a more advanced form of personalization, however, requires you to use more intricate data. This includes both first party data such as consumers’ browsing activities, purchasing behavior, active time, clicks, and more, and zero party data — data consumers are sharing intentionally and proactively with your brand.
Take, for example, customers who put one or more articles in their virtual shopping cart but abandon it before making the purchase. While you can’t know for sure what stopped them, leaving products in the cart gives you an opening — why not send these customers a reminder that their articles are still waiting for them in the cart, or offer similar pieces based on their preferences and add a discount code for good measure.
With Brevo, you can easily achieve this hyper-personalization and automate it by combining customer segmentation with custom events to create more impact with less overhead: First, separate your customer base into smaller groups according to shared characteristics, e.g., demographics, psychography, behavior, or geography. Next, create events for these groups that automatically trigger the pre-set message to these groups. Automation is the key to sending the right message to the right customer at the right time through the right channel effortlessly.
In addition, Brevo gives you access to advanced real-time ecommerce dashboards to monitor and analyze your performance and drive more sales. A comprehensive overview of your campaigns coupled with data such as average time between orders, or what products are often viewed or bought together helps you create impactful cross-sell, upsell, or replenishment campaigns.
The Pendulum Stays Firmly on the Existing Customers’ Side
It seems as if every year in the recent past has been declared the “year of customer retention.” It’s certainly true that companies are not only concentrating on identifying and attracting new customers but also creating loyalty programmes and schemes to reward existing customers and increase their loyalty.
This year, however, shapes up to give this a new urgency. While no one can say exactly what the coming months will bring, the signs are pointing towards an economic downturn. This means consumers will have less money in their pockets this year and be less inclined to spend it on things that are not strictly necessary, such as new clothes.
They will, therefore, be extremely careful about how much money they spend and where. It might seem safe to assume they will turn to brands they already know and love and don’t want to do without. However, research from McKinsey shows that there is more to this: 71% percent of consumers expect personalization from the brands and business they choose and 76% get frustrated when they don’t find this.
Companies can and should embrace this situation by putting a stronger focus on customer marketing and personalized experiences this year. It will be beneficial to them in several ways: First, keeping your brand fresh in customers’ minds and regularly reminding them of your presence increases retention. You can reinforce this by tailoring your marketing messages to show how your company is supporting them, offering discounts, or special sales.
Second, it increases revenue. Generally, existing customers are more reliable buyers than new ones and are more receptive to upselling and cross-selling opportunities, upgrades, and add-ons. Research has shown that increasing customer retention rates by only 5% can increase profits by 25-95%. During a recession this will likely be more on the lower end of that range. However, in the long-term it still holds true and is especially important given the costs associated with lead generation.
Third, it also increases acquisition — through customer advocacy. People talk about purchases and interactions with brands — good or bad — with family and friends, and also on social media. If you offer good, enjoyable customer experiences, those testimonials will ensure new leads all by themselves.
Social Commerce Is Going Mainstream
China is probably the country with the most mature social commerce market. Despite the pandemic, it has seen solid growth in recent years with the number of users reaching 850 million in 2021. So far, though, the trend hasn’t really spilled over here. However, this will likely change in 2023: Platforms such as Facebook, Instagram, TikTok, Pinterest, and others have started to introduce new features for shopping directly in-app, for instance. And last year, 15 million consumers in the UK alone made purchases through social channels.
As this trend continues to grow, you will need to modify your ecommerce strategy, and explore the corresponding features of different social media channels to find out which best fits your brand, products, and target audience. Fashion brands, for example, benefit from platforms like TikTok and Instagram where they can showcase their clothes in short videos and visualize them on a real person. Livestreams are also increasing in popularity as they give consumers the opportunity to interact in real time with brands, ask questions, and — ultimately — purchase items.
Don’t underestimate the importance of direct communication here. When customers have questions or concerns, they expect immediate answers — not as soon as possible, but in near-real time. Thus, you need to establish channels where you can quickly help your customers and deal with their inquiries. With Brevo, you have several ways to open this kind of communication, for example by chat or WhatsApp. Considering that 80% of Brits use the latter regularly, you should certainly think about integrating WhatsApp in your customer service strategy.
As a business solution provider, Brevo can connect you to the WhatsApp Business API that lets you send as many messages as possible to as many contacts as possible. Your service agents chat via computer instead of smartphone and you can even store quick answers for frequently asked questions to automate their work to a certain extent.
Companies should also look into the possibility of creating a genuine community of their own on these channels, supported by loyal brand ambassadors. These can be influencers, although there’s also much to be said for using employees and external experts. While the former are often the most familiar with your products, the latter will bring a high level of authenticity to the table.
From the Metaverse Back to Reality
It’s still unclear whether the metaverse – Mark Zuckerberg’s vision for the future of computing – will actually come to pass and, if so, to what extent. However, this didn’t stop businesses and marketers in the last year from getting creative and exploring the opportunities offered by the metaverse. Unfortunately, not much has come to pass from these endeavours. And it seems at least doubtful that the market will indeed grow to US$678.8 billion in 2030 as predicted.
It’s still worthwhile, though, to explore new tools and technologies that could prove to be valuable, with one example being augmented and virtual reality (AR/VR). Both present great opportunities for personalized marketing especially in the retail and fashion space and there are already some compelling use cases. These include the ability to project make-up or clothes onto your body to see if they fit you, or the enhancement of certain products via videos or infographics when scanning them with an AR application.
With the help of new technologies like these, companies can provide experiences which are far more personally relevant to each customer, and that immerse them in the brand experience. And looking beyond the immediate shopping experience, new technologies can also be used to improve the whole customer journey and interactions with brands — from customer service to facilitating payments.
To do so, of course, you will need the right tools — tools to help you learn about your customers, engage them, create and execute campaigns, tools that make the whole customer journey easier, and more. However, with an already overly complicated martech stack, it may seem like a bad idea to add even more tools to the mix.
