What's Around The Corner In 2018? A Preview Of Next Year's Retail And Consumer Trends
The FGRT team is busy preparing our 2018 forecasts for what is traditionally our most-read report of the year — our annual retail and tech trends report
Here, we share a few of our long-listed retail and consumer trends, including some that we have seen yet more evidence for in just the last couple of weeks.
Direct-To-Consumer Moves Into Grocery Products
Next year, more brands will look to bypass retailers and sell directly to consumers. So far, the big moves in direct-to-consumer selling have been in nonfood categories such as apparel: Nike and Adidas are among the brands growing their direct sales quickly through flagship stores and e-commerce sites. In 2018, we expect many more brands, and grocery brands in particular, to adopt the direct-to-consumer model.
Two recent developments support our expectations. First, Campbell Soup announced last week that it would be testing its own online delivery service of its packaged soups, which suggests that even the longest-standing grocery brands are starting to look beyond conventional retail. Second, the past week has also seen INS Ecosystem, a company that wants to cut retailers out of the grocery supply chain, launch its initial coin offering (an ICO is, effectively, a bitcoin-based version of an IPO). INS Ecosystem plans to launch its service in 2018, and it promises to deliver a decentralized system that directly connects grocery manufacturers and consumers.
Vending Goes Supersize
In 2018, we think many more consumers will be buying their groceries from unstaffed, high-tech and small-scale grocery stores as vending goes supersize. Just in the last few months, we have seen a flurry of innovation in the vending space:
- In late November, BingoBox, which operates 200 unstaffed convenience stores in China, announced plans to move into Hong Kong, South Korea and Malaysia, and ultimately extend its network to Europe.
- Earlier in November, Auchan Retail China, part of France’s Auchan Group, announced the rollout of its Auchan Minute stores in China. Similar to the way BingoBox stores work, at these unstaffed microstores, shoppers use a smartphone app to enter the store and pay for their purchases.
- In September, a fancy vending concept called Bodega launched in the US. The company uses artificial intelligence to determine what 100 nonperishable pantry items its customers in a given location will likely want to buy, and then stocks those items in the Bodega boxes.
And on the horizon in 2018 is the full-scale launch of Amazon Go, Amazon’s ultrahigh-tech cashierless grocery store.
Wellness Focus Shifts To Encompass Mental Well-Being, Too
For many consumers, wellness is the new luxury, and one to be enjoyed, indulged in and showcased—not least on social media. This is a trend we have covered in detail in 2017 and, in 2018, we expect the focus on well-being to extend more fully into mental wellness.
Major figures such as the UK’s Princes William and Harry have attempted to break down stigmas associated with discussing mental well-being. Meanwhile, new digital services such as Unmind and Headspace offer businesses and consumers affordable, accessible means of addressing mental well-being. We have also seen the emergence of trends such as mental health sick days this year. Next year, we expect more companies and individuals to integrate digital tools for mental wellness into their health programs and routines.
Accelerating The Shift To An Asset-Light World
Finally, we expect to see an accelerated move toward an asset-light world in 2018 as companies and consumers alike look to shed assets and switch to a pay-on-use model.
- In retail, this means names such as Amazon and Walmart in the US and Karstadt and Zalando in Germany will adopt marketplace e-commerce models where they do not hold the inventory. At the same time, brands seeking to grow their e-commerce sales will continue to flock to such marketplaces in order to tap large consumer bases with less investment in front-end e-commerce capabilities.
- In business more broadly, the asset-light world will see more companies swapping ownership of physical assets such as real estate or mainframe computers for leased property or cloud-based services.
- And, for consumers, the move toward an asset-light world means more switching from spending on conventional purchases of physical products to spending on alternatives such as rented products, online subscription services, digital downloads and streaming.
In 2017, we have seen retail and technology change at a pace that few expected, and we think 2018 will prove similarly dynamic. We will outline our expectations in full when we unveil our 18 trends for 2018 in January.
Deborah Weinswig, contributor