The past two pandemic years have altered the retail sector in ways unimaginable and 2022 has brand new trends in store for consumers. (Photo by Xabiso Mkhabela/Anadolu Agency via Getty Images)
The past two pandemic years have altered the retail sector in ways unimaginable and 2022 has brand new trends in store for consumers.
With 16.2 million of the population now fully vaccinated against Covid-19, 2022 should look different from 2020, which was marred by mass shop closures and stay-at-home regulations that created chaos for retailers, while 2021 was a year of readjustment marked by a sluggish economic recovery.
This year is likely to see some trends from 2021 continuing, such as greenwashing — portray an environmentally responsible image without sufficient responsible action. The social-media shopping trend driven by influencers will have a different look, according to Bronwyn Williams, a futurist and business trends analyst from Flux Trends.
The first trend identified by Williams is that of “active selling” by influencers, rather than the passive selling they have been doing. Active sellers seek out potential buyers, make them aware of a product and convince them to buy it. Passive selling, on the other hand, involves an influencer, for example, casually mentioning a product they liked but don’t actively convince their audience to buy it.
“The problem with influencer marketing from a business or brand perspective is that in a traditional sense it is meant to be authentic and look spontaneous, but this then makes it difficult to track the exact sale that you get from those campaigns and there have been pushes from brands trying to justify why they are paying influencers,” Williams said.
Instead of brands paying influencers based on impressions, in 2022 they’ll get paid based on clicks and actual sales.
“We will see these sales-based influencers and it is an evolution from passive word-of-mouth to active clicks and tracking [promotion] code,” Williams said.
“This is the social media version of direct selling via call-in infomercials. In other words, influencers are setting up their in-home shopping network by making use of things like Instagram stories or TikTok videos, to not just show products but to actually push products. Influencers will no longer just sell the lifestyle, they will sell the product.”
A second layer to the social media shopping trend in 2022 will be social shopping, which is already established but is likely to be used by brands and retailers to complement e-commerce. It relies on brand ambassadors rather than influencers.
“The evolution of social selling as opposed to social-media selling is where retail stores, which typically have highly trained sales staff at those high end boutiques, like in Diamond Walk in Sandton, use their staff to sell items on social platforms. In a way sales people have become influencers. These people are becoming ‘the shoe guy’, ‘the bag guy’ or ‘the dress guy’, which is interesting to see. Sales staff are now taking those personal concierge positions,” said Williams.
Consumer concerns will continue to drive retailers and brands towards adopting a more environmentally responsible strategy in 2022 but Williams believes brands are probably lying about their carbon footprint.
“An example is the Woolworths bag; the bags you buy to be a ‘good person’. You can use one bag 300 or so times before it has the same footprint as a disposable bag. Customers who feel guilty about their purchasing behaviour will be susceptible to paying unnecessary green taxes,” she said.
“We will only reach sustainability when we stop consuming stuff we don’t need.”
Although Tiendeo, a company specialising in the digitisation of the retail sector, identified the rise of the “experiential store” as a key trend that will revolutionise retail in 2022, Williams thinks this is unlikely in South Africa.
An experiential store’s primary focus isn’t sales. Instead, it works on all five senses to make in-store shopping a trip to look forward to.
“We saw Sandton City experimenting with lots of them … they are expensive to set up,” said Williams. “You won’t be able to monetise your rent, which is so expensive, particularly in South African malls. Retail still has slow foot traffic and [retailers] need the turnover to justify them having a physical space.”
Downtrading, in which consumers switch from expensive brands to cheaper alternatives, will also characterise shopping in 2022 as South Africans contend with a weak economy, record unemployment and high inflation, said Casparus Treurnicht, a research analyst and portfolio manager at Gryphon Asset Management.
“With the consumer increasingly under pressure, the wealthy emigrating, unemployment rising, we are going to continue seeing downtrading,” Treurnicht said. “I don’t want to know what the scenario might have been if we didn’t have this commodities boom that we are seeing right now. It is having a positive effect on our consumers but they are barely keeping their head above water.”
Global demand for commodities produced in South Africa by mining companies, such as platinum, rose in 2021, pushing prices higher. The boom has seen mining companies notch better profits and, in turn, have paid higher taxes, giving the economy a boost.
Downtrading directly results in the value segment of the market doing well. An example is how Mr Price brought Power Fashion, a value business, into its stable in 2020. Results for the 13 weeks to 1 January 2022 show that Power Fashion has given Mr Price a boost, with its overall apparel sales for the period growing by 19%. Excluding Power Fashion, sales were only up by 6.4%.
“Jet, Mr Price and Pep will continue to do well in this environment.The mid-to-higher end retailers are going to have a problem and are going to continue to struggle to hold on to market share in 2022,” said Treurnicht.
Anathi Madubela is an Adamela Trust business reporter at the M&G.
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