December 26, 2024 • 26 mins
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The holiday rush is behind us, and if you’ve been busy running your business up until Christmas, you’re probably taking a well-deserved breather, pulling yourself together, and getting your sanity back.
But before you get too comfortable, let’s take a moment to look ahead at what’s coming for 2025. In this episode, I want to talk you through what’s on the horizon for next year.
I’ll walk you through the key shifts that will shape the retail landscape and, more importantly, what they mean for your business. We’ll explore how to navigate the upcoming changes, and I’ll share some tips on how to prepare now to stay ahead of the curve.
[00:00] What's ahead in retail for 2025
[02:49] The shift towards younger consumers
[08:13] How brands can adapt to fickle consumers
[10:42] Why considered purchasing matters
[16:09] Looking at hybrid retail: how people mix online and in-person shopping
[21:03] Integrating generative AI into your retail operations
Resources:
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Catherine Erdly (00:00):
Welcome to the Resilient Retail Game Plan.
Episode number 230 (00:02):
what's ahead for 2025.
Hi, I'm your host, Catherine Erdly.
I'm also the founder ofthe Resilient Retail Club.
You can find out more about myservices and offers by going
to resilientretailclub.com.
And today, what I wanted to talk youthrough is what is coming up, what retail
trends that we're going to see in 2025.
(00:25):
So I know it is the 26th of December.
So we've just got through Christmas.
If you have been busy all theway up to Christmas, you may
be just about recovering yoursanity, pulling yourself together.
But I wanted to use this opportunityto have a think about what lies ahead.
(00:48):
Welcome to the Resilient Retail GamePlan, a podcast for anyone wanting to
start, grow or scale a profitable creativeproduct business with me, Catherine Erdly.
The Resilient Retail Game Plan isa podcast dedicated to one thing,
breaking down the concepts and toolsthat I've gathered from 20 years in
the retail industry and showing youhow you can use them in your business.
(01:12):
This is the real nuts and bolts ofrunning a successful product business,
broken down in an easy, accessible way.
This is not a podcast about learninghow to make your business look good.
It's the tools and techniques that willmake you and your business feel good.
Confidently plan, launch, and manageyour products, and feel in control of
(01:32):
your sales numbers and cash flow to helpyou build a resilient retail business.
Fun fact.
When I first started my business,I called it Future Retail because
I was so fascinated by all ofthe different things that were
(01:52):
happening in the retail industry.
And I wanted to really explorewhere their industry was going.
Over time my focus in the business shiftedand I started working with the small and
independent retailers and brands, whichhas been my love for the last seven years.
But I also have a very soft spot forall things to do with retail trends and
(02:14):
it is absolutely fabulous to be able tocontribute to Forbes.com and be able to
really get my hands on loads of greatresearch, talk to lots of amazing experts,
and be a part of the conversation aboutwhat happens next in the retail industry.
So I'm super excited tobring you today's episode.
If you're interested in readingmore about retail trends, do Google
(02:35):
"Catherine Erdley Forbes" and youwill see my contributor page pop up
and you'll be able to take a look.
But I wanted to talk you throughfour key trends that I see ahead
for 2025 and more importantly,what they mean for your business.
So the first thing that I wantedto highlight is this shift
towards younger consumers.
So Gen Z, which broadlyspeaking, is sort of mid to late
(02:59):
teens to about 24 year olds.
That is a group that is growinghugely in their spending power.
We're basically seeing a sort oftransfer of spending power going
from Boomers to Gen Z, dependingon how you want to say it.
The research suggests that by 2030,39 percent of all shopping will be
(03:20):
coming from Millennials and Gen Z,so the younger generations, with
then Gen Alpha coming up behind.
So this is importantfor a number of reasons.
Firstly, this is the most digitallynative generation that we've ever had.
These are the people that grewup with iPads, with smartphones.
(03:43):
They've never reallyknown anything different.
So they are fully, fully comfortablebeing online and also specifically
running their lives from their phones.
So the kind of key things to thinkabout when it comes to this transfer
of purchasing power, if you like,is that the Gen Z customer is really
(04:04):
all about ease and convenienceand it's really mobile first.
So mobile commerce, peoplepurchasing from their phones,
that's been rising year on year.
Every year it increases,it becomes more important.
And we're also seeing the rise,continued rise of social commerce.
So social commerce, mobile commerce,any purchasing that happens on a mobile
(04:26):
phone, social commerce is part of that.
So that is purchaseshappening through social apps.
So inside Instagram, TikTok, and we'reseeing growth in all of those elements.
So the website that we have all spent manyhours agonizing over, the desktop version,
is definitely going to start taking aback seat as customers just become more
(04:48):
and more comfortable with their mobilephones and sort of the opposite of the
kind of like the mirror of that, whichis that the customers that are naturally
already really comfortable with theirphones and running life from their phones,
their spending power is going to increase.
So it's definitely something to consider.
And also, where I think the opportunitycomes is obviously for a lot of people,
(05:13):
those of us who've been on Instagramsince the heady days of the sort of
2010s when you could get really greatorganic reach on Instagram, it can be
feel very demoralizing in being on thatplatform when it's a different game.
You're just seeing a different, acompletely different way of operating.
However, what I would say is thatwhat we're seeing with this growth
(05:34):
of people who were really comfortableshopping on their phones, they
are using them for everything.
They're using them to checkout, but they're also using it
for research and they're alsousing it for that social proof.
So they want to see otherpeople using your products.
They want to see the business themselvesshowing how the product could be used.
(05:56):
And so they are really using it forresearch, as well as for final purchase.
So everything is happening in the apps.
And I think that that is anopportunity for us as small business
owners to really start thinking abit differently about social media.
In terms of, it's about nurturing and it'sabout building communities and connections
(06:21):
and also accepting that it's going tobe predominantly a consideration tool.
So if somebody sees you an ad, forexample of yours, they're going to
go to your social media profile andthey're going to use that to understand
more about what you do and to movetheir purchasing decision along.
So don't neglect that throughfeeling despondent, for example.
(06:42):
You need to think about thereforeyour social media as where you
can show your proof, your socialproof, your user generated content,
and all of that kind of thing toreally connect with this customer.
Not to mention, just got tomake it smooth and seamless.
So people may want to buyin through social apps.
They may want to buy on yourwebsite, but on their phone.
(07:04):
So making sure that everything is mobileoptimized is really important as well.
People, younger generations are alsodoing a lot of research across channels.
So even if they are going intostore, they will have done
their research online first.
And we'll touch on that a little bitmore later as another big trend and
therefore you've got to make sure yourpricing is consistent, that basically
(07:25):
everything works really smoothly.
They want it to be easy and convenient.
Those are key things for thisgeneration: ease and convenience.
The other areas I think that arepotentially an opportunity of things.
Like the fact that they're muchmore, much more comfortable with
things like AI, with chatbots.
(07:47):
And so in terms of, again AI, a big theme,which we'll talk about a bit more later,
but in terms of how you can leverage this.
Then the younger consumer is not beingput off by having technology doing
some of the lifting when it comesto answering queries, for example.
So I think that that is an opportunityfor small business owners who
(08:08):
ultimately wear a lot of hats.
They can look at ways that technologycan interact with their customers more.
Another piece to think about withthis younger consumer, millennials and
Gen Z, they are a little bit fickle.
So they tend to have lower levels of brandloyalty compared to other generations.
(08:28):
That is potentially also anopportunity because it means that
they're not getting wedded into abig brand and not really wanting to
try or have a look at anything else.
So there's opportunitiesthere to gain new customers.
When it comes to keeping them, thatis trickier, but that's where things
like personalized messaging, especiallythrough emails is going to become even
(08:51):
more important than it already is.
And also thinking about how you canmake it personal at scale, which
again, that comes through a lot ofAI, but also this idea of community.
So this is something that I think willalso become much more of a buzzword
over the next couple of years in retail.
And I think big retailers are goingto start trying to cotton on to that.
(09:13):
Going to start to cotton onto the factthat having a community is a way of kind
of counteracting this increased ficklenessor this decreased brand loyalty.
And that is that people maybe won'tbe seeing so much loyalty to brands.
But they might see more of like aconnection to other people, either the
person in the business, which again isgreat news for small business owners,
(09:34):
because it's very easy for you toput yourself front and center because
that is who is running the business.
But equally the people who are aroundthis business and sharing the sharing
the same ethics and values and Iwas talking in my mastermind group.
We have our weekly group calls, and wewere talking about Lucy and Yak, for
(09:54):
example, is a perfect illustration ofthis way of creating community that
people, they buy the brand becausethey love the product, but they also
are bought into the brand values andthen the interactions that they're
getting within that community as well.
So I think that as the money shiftstowards younger consumers, it's less
(10:15):
about thinking about brand loyalty andmore about thinking about the community.
And if your customers feel likethey're part of something, they're
much more likely to come backand remain more brand loyal.
Even if they maybe aren't thinkingabout it so much in brand loyalty terms.
They're more thinking about,they feel comfortable because
they're part of a community.
So that was the first trend, the shiftto the younger consumer and what that
(10:37):
means effectively in the way thatthey shop, how they shop, and what
they want to see from businesses.
The second piece, and I suppose reallygoing back a step, the fact that the
consumer is getting younger or that, Ishould say, the younger generations are
growing in their purchasing power, italmost runs through every other single
trend because it has a knock on impact.
(10:58):
Because if you think about thepeople who are doing the majority
of the buying, that's really has abig impact on the overall retail
industry and how people shop.
So the second piece, then the secondbig trend is considered purchasing.
So considered purchasing pretty muchevery year that I do these trend recaps,
and I've been doing them since 2020.
(11:19):
So this is my fifth one.
I often bring up sustainability ifI'm honest, it almost always comes up.
And the big thing is that itchanges and it shifts year on year.
So, sustainability used tobe, back in the day, about do
you have recyclable packaging?
Then there's the whole bigpush towards zero plastic.
(11:42):
Now people, there's acouple of different things.
People are number one looking forpeople, brands, and businesses to
be regenerative where possible.
So not just not doing harm,but actively doing good.
Whether that's planting trees or perhapsthe packaging that they have gives back
in some way because they make a donationto a certain cause or something like that.
(12:02):
Or maybe it's created by clearingup ocean plastics, for example, and
then turning them into something.
So people are almost expectingnow to see regenerative as
opposed to just sustainable.
And when I say people, I mean, there'salways going to be there's a continuum.
There's the customers that aren't thatbothered, but then the number of customers
(12:22):
that are concerned grows year on year.
So more and more of the customer baseis thinking about sustainability.
What people consider to be okay grows.
I think that the demands get a littlebit higher each year, but equally so I
think that customers are also more cynicalso they know that there's greenwashing.
(12:47):
They know that people say things andyou know, it's all of the things like
when a fast fashion business talksabout their eco range and yet they
sell it for four pounds and you justthink, well, how does that, work?
Okay, maybe the products recycled,but maybe some of the fabrics made
from recycled something or other.
But really, how eco or how fair is this tothe people in the supply chain, let alone
(13:09):
the actual materials that it's made of.
So I think there is a growing cynicism.
There is a growing backlash againstover consumption and equally a real
kind of need for businesses to bereally transparent and proof that what
they're doing is actually somethingmore than just a marketing message.
(13:29):
So I think that's the kind ofbackground, the landscape that we're
in right now is that people do wantto see sustainability efforts and
it is important to the customer.
But I think personally, you're better offdoing something smaller than trying to
and being transparent and open about it.
If you can't eliminate plastic fromevery single element of what you
(13:51):
do, but you are open about the oneswhere you can, then I think that
customers are ready to hear that.
I also think there's a reason I calledit considered purchasing and not just
sustainability is that I think it kind ofgoes a little bit beyond sustainability.
I think it's more of a general feelingthat people's disposable income, I think
(14:12):
it's, I think it's, better than it's been.
I think that inflationhas definitely eased.
There is not quite so many worries asthere were before, about things like the
cost of fuel or interest rates aren't asdominant of a fear in the consumer's mind.
Although, obviously, many people arestill being impacted by these things.
(14:33):
So I think that the consumer overallis a bit more confident than they have
been over the last couple of years.
However, I do think they are thinkingcarefully about what they're purchasing.
And I think that that's acombination of things like
wanting to avoid overconsumption.
This whole idea of we've hit peakstuff, you know, most people are
(14:53):
thinking about decluttering andreducing the amount of things that
they have instead of adding to them.
So it just means that when theyare buying that they really need
to have a reason that they want toknow about the product, that they're
thinking about it there, which I thinkis a positive thing to be honest.
And I think one that small businessowners are well placed to tap into
(15:16):
because you can tell the story andI think storytelling about your
products is going to be increasinglyimportant as we move into 2025 as well.
I'm really explaining the valuebehind them and what makes them
so special and all the things thatyou know make them special, but
are you telling the customers that?
So I think that we are seeing continuedsupport for small businesses.
So some research that I saw recentlysaid that 21 percent of people were
(15:40):
actively aiming to increase what theybought from small businesses this year.
And people are looking to support small,they know that supporting small and local
and independent is a positive thing to do.
And so I think that as small businessowners, we have to tap into that
and we have to tell the storiesabout our products and explain what
makes them so great and allow thatcustomer that is being considered
(16:03):
with their purchasing to feel really,really good about buying from us.
Okay, so point number threeis about hybrid retail.
So I love this trend because I thinkthat, for a long time, people really
thought about physical retail ande-commerce as two different things,
and they're so, so intertwined.
Also, going back to my previouspoint, I do think we are going to see
(16:23):
people's decision making processesextending a little bit as well.
So where people might have just said,yep, okay, and bought something.
They are thinking about it.
So everything that you create from yourbusiness content perspective is, it's
useful to really think about the fact thatpeople are taking long to make decisions.
So don't be afraid to be puttingout lots of different content for
(16:45):
them to consume, to help them movealong that decision making process.
But hybrid retail, goingback to hybrid retail.
So this is the combination of, there'sa terrible word which people use called
fidgetal, which I'm not a fan of.
Physical, digital combined.
So I'm not going to say that word.
Hybrid retail, so it's reallyabout understanding more about
(17:05):
the movement between peopleshopping online and offline.
And there is definite evidence thatwe're seeing more of this happening.
So research by Shopify suggested that61 percent of people were looking at
products online before buying in stores.
And during Black Friday, Cyber Monday, aQR codes unlimited, which is the largest
QR code provider to Shopify stores, sawa big increase in QR code interaction.
(17:30):
Which means basically that people werestarting in store and looking at a
product there and interacting with it, butthen they were ending up buying online.
So we've seen evidence of increasedbehavior in both directions.
We've also got the continueddevelopment of technology such as
NearSt, which is a company thatI've been following for years.
(17:52):
And what they do, which I think issuper exciting is that they make
physical inventory searchable.
So for example, if you want to searchfor, "I need AA batteries," you can
search "AA batteries near me" and it willpop up with the shops that stock them.
So it's instead of ordering somethingfrom Amazon to come the next day or adding
(18:13):
something to online grocery shopping,you can just see, "Oh, actually, if I
walk for five minutes in that direction,I'll get some AA batteries," for example.
So I think that's really interesting.
And I think again, a big opportunityfor small businesses because I think
that it's about understanding how thecustomer shops and allowing them to shop.
(18:34):
If they want to research before theycome in store, let them do that.
Make sure you're set up for that.
If they want to interact withyour products in store, but then
buy online, then that's okay too.
And I think that the more we canfacilitate that, then we are actually
encouraging really great solid customerswho will buy from us in a longer term.
Because a lot of research shows thatif somebody buys from you more than
(18:57):
one channel or even interacts withyour business on more than one channel,
then you are going to generallyspeaking, keep that customer for longer.
They're going to be a bettercustomer, a repeat customer.
They tend to spend more, return lessand tell people about your brand more.
So in other words, they are the bestkind of customer that you can have.
So I think that it's an excitingopportunity to really think about how
(19:20):
you ping people from one to the other.
If you're a physical store with a website,for example, are you getting people
to move from one channel to the other?
And how are you doing that?
How are you encouraging that?
Can you use things like QR codes?
Can you make sure thatyou're highlighting the URL?
Can you send people emails andencourage them to come into store?
All of those things that can bereally, really helpful to get
(19:42):
people to actually move in between.
And if you think about the ideaof moving them in between, it's
almost like a goal for you to have.
What can you do to encourage that?
And also makes thingsmore convenient for them.
Can you offer click and collect?
Can you offer something that if you wantto buy something in store and reserve it,
you could offer them free delivery lateror something like that, if it's local.
(20:05):
So just thinking about all ofthe different ways that you could
get them to interact with yourstore in different channels.
And I think what is interesting aswell is for ecommerce brands is
thinking about the role of physicalretail or in person retail.
Whether or not it's a pop up, whetheror not it's an event, and thinking
about how that works for you.
But equally so, if you're somebodywho doesn't have a physical store, but
(20:28):
you do events, like how are you movingpeople between your channels there?
Are you encouraging your mailinglist in your social media to
come and see you at the event?
And when you're at the event, are youcapturing people's emails addresses?
Which is, I really stronglyencourage you to do that.
If you're seeing people in person,try very hard to connect with
(20:49):
them and make sure that you cankeep talking to them afterwards.
Because again, if they buy from you inperson, and then they buy from you online,
then they're much more likely to becomea really great regular, repeat customer.
And then the fourth trend we have is AI.
So generative AI is absolutely everywhere.
It's amazing to me to see howquickly this has grown because really
(21:11):
just this time last year we weretalking about it for the first time.
It didn't even make it onto mytrends report for 2023 and it kind
of exploded onto the scene in 2023.
ChatGPT was one of the fastest launchingwebsites in terms of traffic growth
ever and we have seen generative AI.
(21:31):
So specifically, generative AIis AI that can create things.
So AI has been around for years.
I did a talk on AI back in like 2018.
So artificial intelligence and bigdata machine learning, that's been
behind a lot of elements of theretail industry for absolutely years.
So things like, powering your Amazonrecommendations and stuff like that.
(21:53):
But I think what's really just spun itinto another level has been the fact
that it can generate, so generate text.
And I think that we're going tosee it reshape the retail industry
in ways that some are predictable.
Some I think we won't be able topredict until we get a bit further
down, but we're going to see thatreally impact the industry in 2025.
(22:15):
Now I personally think that generativeAI is a huge opportunity for small
businesses because I was having thisconversation with someone the other day
about the fact that obviously there'sa big concern over it impacting jobs.
But in a small retail business where Isee it having value is it's not taking
(22:35):
anyone's job if you never had anyone to dothat job in the first place, for example.
Because basically as a founder, you oftenend up wearing so many different hats.
So you may have well been the personwriting the product descriptions
as well as the emails, as wellas planning out the marketing.
And now you can get support with that.
(22:55):
You don't ever really haveto be stuck for ideas.
Again, this is something that I'm reallykeen to incorporate inside the Resilient
Retail Club in 2025 is specificallytailored AI bots for independent retailers
to help with ideas about sales growth.
Basically, that's what I'm working on.
And I think that there's so manyopportunities to basically make yourself
(23:21):
more efficient, improve your efficiency ina way that it's not about taking away jobs
from other people, but maybe about yougetting to bed before 2am when it's busy.
So for me, that is a big winand a really big opportunity.
And I think that if you haven't thoughtabout using AI or if you've not dabbled
with it, then definitely take a look.
(23:41):
Now, the only thing I will say,the only note of caution about
AI that I, that in the back of myhead concerns me a little bit is I
think it's really great for ideas.
I think it is brilliant for ideation.
So if you are need to come upwith some ideas, then fantastic.
Go ahead.
(24:02):
Do the come up with the ideas using AI.
I do think that there is possibilityor very high probability that the world
has become going to become flooded withmediocre AI messaging because you can
say get it to write this campaign for me.
And if you don't give it moredetail, it's just going to generate
(24:24):
a load of very, very generic stuff.
And then if everyone's doing that,then basically what we're doing
is just creating a lot more noise.
And yes, it's good to be consistent,but if what you're being consistent
with is pretty mediocre, then Ithink that's not necessarily helpful.
So for me, it's going to be aboutoperational efficiency and ideas.
So helping you generate ideas.
(24:45):
But I think the magic will stillcome when you're able to put your own
particular spit on it, as opposed togetting something too generic from the AI.
Now you can put a lot of input intoit and you get better and better
results, the more you put in.
But I think that that would be my caution.
For anyone listening with AI is thinkabout how it can make you better,
more streamlined, more efficient, butalso just watch that you don't lose
(25:09):
some of that humanity as it were.
So there you have it.
Those are my four trends for 2025.
The shift to younger generations,Gen Z, considered purchasing
hybrid retail and generative AI.
I'd love to hear what you thoughtand what you think will be the
big trends for 2025 coming up.
Otherwise, I hope youare having a good break.
(25:33):
We are going to be back next weekwith an interview with the fabulous
Jamie Watkins from Divine Savages,who's part of my mastermind.
Their mastermind cohort forJanuary will be opening soon.
So keep an eye out for that.
And in the show notes, we have got alink to my talk happening on the 8th
of January, which is called from sixfigure years to six figure months.
(25:56):
And we'd love to see you there.
Welcome to the Resilient Retail Game Plan.
Episode number 230 (00:02):
what's ahead for 2025.
Hi, I'm your host, Catherine Erdly.
I'm also the founder ofthe Resilient Retail Club.
You can find out more about myservices and offers by going
to resilientretailclub.com.
And today, what I wanted to talk youthrough is what is coming up, what retail
trends that we're going to see in 2025.
(00:25):
So I know it is the 26th of December.
So we've just got through Christmas.
If you have been busy all theway up to Christmas, you may
be just about recovering yoursanity, pulling yourself together.
But I wanted to use this opportunityto have a think about what lies ahead.
(00:48):
Welcome to the Resilient Retail GamePlan, a podcast for anyone wanting to
start, grow or scale a profitable creativeproduct business with me, Catherine Erdly.
The Resilient Retail Game Plan isa podcast dedicated to one thing,
breaking down the concepts and toolsthat I've gathered from 20 years in
the retail industry and showing youhow you can use them in your business.
(01:12):
This is the real nuts and bolts ofrunning a successful product business,
broken down in an easy, accessible way.
This is not a podcast about learninghow to make your business look good.
It's the tools and techniques that willmake you and your business feel good.
Confidently plan, launch, and manageyour products, and feel in control of
(01:32):
your sales numbers and cash flow to helpyou build a resilient retail business.
Fun fact.
When I first started my business,I called it Future Retail because
I was so fascinated by all ofthe different things that were
(01:52):
happening in the retail industry.
And I wanted to really explorewhere their industry was going.
Over time my focus in the business shiftedand I started working with the small and
independent retailers and brands, whichhas been my love for the last seven years.
But I also have a very soft spot forall things to do with retail trends and
(02:14):
it is absolutely fabulous to be able tocontribute to Forbes.com and be able to
really get my hands on loads of greatresearch, talk to lots of amazing experts,
and be a part of the conversation aboutwhat happens next in the retail industry.
So I'm super excited tobring you today's episode.
If you're interested in readingmore about retail trends, do Google
(02:35):
"Catherine Erdley Forbes" and youwill see my contributor page pop up
and you'll be able to take a look.
But I wanted to talk you throughfour key trends that I see ahead
for 2025 and more importantly,what they mean for your business.
So the first thing that I wantedto highlight is this shift
towards younger consumers.
So Gen Z, which broadlyspeaking, is sort of mid to late
(02:59):
teens to about 24 year olds.
That is a group that is growinghugely in their spending power.
We're basically seeing a sort oftransfer of spending power going
from Boomers to Gen Z, dependingon how you want to say it.
The research suggests that by 2030,39 percent of all shopping will be
(03:20):
coming from Millennials and Gen Z,so the younger generations, with
then Gen Alpha coming up behind.
So this is importantfor a number of reasons.
Firstly, this is the most digitallynative generation that we've ever had.
These are the people that grewup with iPads, with smartphones.
(03:43):
They've never reallyknown anything different.
So they are fully, fully comfortablebeing online and also specifically
running their lives from their phones.
So the kind of key things to thinkabout when it comes to this transfer
of purchasing power, if you like,is that the Gen Z customer is really
(04:04):
all about ease and convenienceand it's really mobile first.
So mobile commerce, peoplepurchasing from their phones,
that's been rising year on year.
Every year it increases,it becomes more important.
And we're also seeing the rise,continued rise of social commerce.
So social commerce, mobile commerce,any purchasing that happens on a mobile
(04:26):
phone, social commerce is part of that.
So that is purchaseshappening through social apps.
So inside Instagram, TikTok, and we'reseeing growth in all of those elements.
So the website that we have all spent manyhours agonizing over, the desktop version,
is definitely going to start taking aback seat as customers just become more
(04:48):
and more comfortable with their mobilephones and sort of the opposite of the
kind of like the mirror of that, whichis that the customers that are naturally
already really comfortable with theirphones and running life from their phones,
their spending power is going to increase.
So it's definitely something to consider.
And also, where I think the opportunitycomes is obviously for a lot of people,
(05:13):
those of us who've been on Instagramsince the heady days of the sort of
2010s when you could get really greatorganic reach on Instagram, it can be
feel very demoralizing in being on thatplatform when it's a different game.
You're just seeing a different, acompletely different way of operating.
However, what I would say is thatwhat we're seeing with this growth
(05:34):
of people who were really comfortableshopping on their phones, they
are using them for everything.
They're using them to checkout, but they're also using it
for research and they're alsousing it for that social proof.
So they want to see otherpeople using your products.
They want to see the business themselvesshowing how the product could be used.
(05:56):
And so they are really using it forresearch, as well as for final purchase.
So everything is happening in the apps.
And I think that that is anopportunity for us as small business
owners to really start thinking abit differently about social media.
In terms of, it's about nurturing and it'sabout building communities and connections
(06:21):
and also accepting that it's going tobe predominantly a consideration tool.
So if somebody sees you an ad, forexample of yours, they're going to
go to your social media profile andthey're going to use that to understand
more about what you do and to movetheir purchasing decision along.
So don't neglect that throughfeeling despondent, for example.
(06:42):
You need to think about thereforeyour social media as where you
can show your proof, your socialproof, your user generated content,
and all of that kind of thing toreally connect with this customer.
Not to mention, just got tomake it smooth and seamless.
So people may want to buyin through social apps.
They may want to buy on yourwebsite, but on their phone.
(07:04):
So making sure that everything is mobileoptimized is really important as well.
People, younger generations are alsodoing a lot of research across channels.
So even if they are going intostore, they will have done
their research online first.
And we'll touch on that a little bitmore later as another big trend and
therefore you've got to make sure yourpricing is consistent, that basically
(07:25):
everything works really smoothly.
They want it to be easy and convenient.
Those are key things for thisgeneration: ease and convenience.
The other areas I think that arepotentially an opportunity of things.
Like the fact that they're muchmore, much more comfortable with
things like AI, with chatbots.
(07:47):
And so in terms of, again AI, a big theme,which we'll talk about a bit more later,
but in terms of how you can leverage this.
Then the younger consumer is not beingput off by having technology doing
some of the lifting when it comesto answering queries, for example.
So I think that that is an opportunityfor small business owners who
(08:08):
ultimately wear a lot of hats.
They can look at ways that technologycan interact with their customers more.
Another piece to think about withthis younger consumer, millennials and
Gen Z, they are a little bit fickle.
So they tend to have lower levels of brandloyalty compared to other generations.
(08:28):
That is potentially also anopportunity because it means that
they're not getting wedded into abig brand and not really wanting to
try or have a look at anything else.
So there's opportunitiesthere to gain new customers.
When it comes to keeping them, thatis trickier, but that's where things
like personalized messaging, especiallythrough emails is going to become even
(08:51):
more important than it already is.
And also thinking about how you canmake it personal at scale, which
again, that comes through a lot ofAI, but also this idea of community.
So this is something that I think willalso become much more of a buzzword
over the next couple of years in retail.
And I think big retailers are goingto start trying to cotton on to that.
(09:13):
Going to start to cotton onto the factthat having a community is a way of kind
of counteracting this increased ficklenessor this decreased brand loyalty.
And that is that people maybe won'tbe seeing so much loyalty to brands.
But they might see more of like aconnection to other people, either the
person in the business, which again isgreat news for small business owners,
(09:34):
because it's very easy for you toput yourself front and center because
that is who is running the business.
But equally the people who are aroundthis business and sharing the sharing
the same ethics and values and Iwas talking in my mastermind group.
We have our weekly group calls, and wewere talking about Lucy and Yak, for
(09:54):
example, is a perfect illustration ofthis way of creating community that
people, they buy the brand becausethey love the product, but they also
are bought into the brand values andthen the interactions that they're
getting within that community as well.
So I think that as the money shiftstowards younger consumers, it's less
(10:15):
about thinking about brand loyalty andmore about thinking about the community.
And if your customers feel likethey're part of something, they're
much more likely to come backand remain more brand loyal.
Even if they maybe aren't thinkingabout it so much in brand loyalty terms.
They're more thinking about,they feel comfortable because
they're part of a community.
So that was the first trend, the shiftto the younger consumer and what that
(10:37):
means effectively in the way thatthey shop, how they shop, and what
they want to see from businesses.
The second piece, and I suppose reallygoing back a step, the fact that the
consumer is getting younger or that, Ishould say, the younger generations are
growing in their purchasing power, italmost runs through every other single
trend because it has a knock on impact.
(10:58):
Because if you think about thepeople who are doing the majority
of the buying, that's really has abig impact on the overall retail
industry and how people shop.
So the second piece, then the secondbig trend is considered purchasing.
So considered purchasing pretty muchevery year that I do these trend recaps,
and I've been doing them since 2020.
(11:19):
So this is my fifth one.
I often bring up sustainability ifI'm honest, it almost always comes up.
And the big thing is that itchanges and it shifts year on year.
So, sustainability used tobe, back in the day, about do
you have recyclable packaging?
Then there's the whole bigpush towards zero plastic.
(11:42):
Now people, there's acouple of different things.
People are number one looking forpeople, brands, and businesses to
be regenerative where possible.
So not just not doing harm,but actively doing good.
Whether that's planting trees or perhapsthe packaging that they have gives back
in some way because they make a donationto a certain cause or something like that.
(12:02):
Or maybe it's created by clearingup ocean plastics, for example, and
then turning them into something.
So people are almost expectingnow to see regenerative as
opposed to just sustainable.
And when I say people, I mean, there'salways going to be there's a continuum.
There's the customers that aren't thatbothered, but then the number of customers
(12:22):
that are concerned grows year on year.
So more and more of the customer baseis thinking about sustainability.
What people consider to be okay grows.
I think that the demands get a littlebit higher each year, but equally so I
think that customers are also more cynicalso they know that there's greenwashing.
(12:47):
They know that people say things andyou know, it's all of the things like
when a fast fashion business talksabout their eco range and yet they
sell it for four pounds and you justthink, well, how does that, work?
Okay, maybe the products recycled,but maybe some of the fabrics made
from recycled something or other.
But really, how eco or how fair is this tothe people in the supply chain, let alone
(13:09):
the actual materials that it's made of.
So I think there is a growing cynicism.
There is a growing backlash againstover consumption and equally a real
kind of need for businesses to bereally transparent and proof that what
they're doing is actually somethingmore than just a marketing message.
(13:29):
So I think that's the kind ofbackground, the landscape that we're
in right now is that people do wantto see sustainability efforts and
it is important to the customer.
But I think personally, you're better offdoing something smaller than trying to
and being transparent and open about it.
If you can't eliminate plastic fromevery single element of what you
(13:51):
do, but you are open about the oneswhere you can, then I think that
customers are ready to hear that.
I also think there's a reason I calledit considered purchasing and not just
sustainability is that I think it kind ofgoes a little bit beyond sustainability.
I think it's more of a general feelingthat people's disposable income, I think
(14:12):
it's, I think it's, better than it's been.
I think that inflationhas definitely eased.
There is not quite so many worries asthere were before, about things like the
cost of fuel or interest rates aren't asdominant of a fear in the consumer's mind.
Although, obviously, many people arestill being impacted by these things.
(14:33):
So I think that the consumer overallis a bit more confident than they have
been over the last couple of years.
However, I do think they are thinkingcarefully about what they're purchasing.
And I think that that's acombination of things like
wanting to avoid overconsumption.
This whole idea of we've hit peakstuff, you know, most people are
(14:53):
thinking about decluttering andreducing the amount of things that
they have instead of adding to them.
So it just means that when theyare buying that they really need
to have a reason that they want toknow about the product, that they're
thinking about it there, which I thinkis a positive thing to be honest.
And I think one that small businessowners are well placed to tap into
(15:16):
because you can tell the story andI think storytelling about your
products is going to be increasinglyimportant as we move into 2025 as well.
I'm really explaining the valuebehind them and what makes them
so special and all the things thatyou know make them special, but
are you telling the customers that?
So I think that we are seeing continuedsupport for small businesses.
So some research that I saw recentlysaid that 21 percent of people were
(15:40):
actively aiming to increase what theybought from small businesses this year.
And people are looking to support small,they know that supporting small and local
and independent is a positive thing to do.
And so I think that as small businessowners, we have to tap into that
and we have to tell the storiesabout our products and explain what
makes them so great and allow thatcustomer that is being considered
(16:03):
with their purchasing to feel really,really good about buying from us.
Okay, so point number threeis about hybrid retail.
So I love this trend because I thinkthat, for a long time, people really
thought about physical retail ande-commerce as two different things,
and they're so, so intertwined.
Also, going back to my previouspoint, I do think we are going to see
(16:23):
people's decision making processesextending a little bit as well.
So where people might have just said,yep, okay, and bought something.
They are thinking about it.
So everything that you create from yourbusiness content perspective is, it's
useful to really think about the fact thatpeople are taking long to make decisions.
So don't be afraid to be puttingout lots of different content for
(16:45):
them to consume, to help them movealong that decision making process.
But hybrid retail, goingback to hybrid retail.
So this is the combination of, there'sa terrible word which people use called
fidgetal, which I'm not a fan of.
Physical, digital combined.
So I'm not going to say that word.
Hybrid retail, so it's reallyabout understanding more about
(17:05):
the movement between peopleshopping online and offline.
And there is definite evidence thatwe're seeing more of this happening.
So research by Shopify suggested that61 percent of people were looking at
products online before buying in stores.
And during Black Friday, Cyber Monday, aQR codes unlimited, which is the largest
QR code provider to Shopify stores, sawa big increase in QR code interaction.
(17:30):
Which means basically that people werestarting in store and looking at a
product there and interacting with it, butthen they were ending up buying online.
So we've seen evidence of increasedbehavior in both directions.
We've also got the continueddevelopment of technology such as
NearSt, which is a company thatI've been following for years.
(17:52):
And what they do, which I think issuper exciting is that they make
physical inventory searchable.
So for example, if you want to searchfor, "I need AA batteries," you can
search "AA batteries near me" and it willpop up with the shops that stock them.
So it's instead of ordering somethingfrom Amazon to come the next day or adding
(18:13):
something to online grocery shopping,you can just see, "Oh, actually, if I
walk for five minutes in that direction,I'll get some AA batteries," for example.
So I think that's really interesting.
And I think again, a big opportunityfor small businesses because I think
that it's about understanding how thecustomer shops and allowing them to shop.
(18:34):
If they want to research before theycome in store, let them do that.
Make sure you're set up for that.
If they want to interact withyour products in store, but then
buy online, then that's okay too.
And I think that the more we canfacilitate that, then we are actually
encouraging really great solid customerswho will buy from us in a longer term.
Because a lot of research shows thatif somebody buys from you more than
(18:57):
one channel or even interacts withyour business on more than one channel,
then you are going to generallyspeaking, keep that customer for longer.
They're going to be a bettercustomer, a repeat customer.
They tend to spend more, return lessand tell people about your brand more.
So in other words, they are the bestkind of customer that you can have.
So I think that it's an excitingopportunity to really think about how
(19:20):
you ping people from one to the other.
If you're a physical store with a website,for example, are you getting people
to move from one channel to the other?
And how are you doing that?
How are you encouraging that?
Can you use things like QR codes?
Can you make sure thatyou're highlighting the URL?
Can you send people emails andencourage them to come into store?
All of those things that can bereally, really helpful to get
(19:42):
people to actually move in between.
And if you think about the ideaof moving them in between, it's
almost like a goal for you to have.
What can you do to encourage that?
And also makes thingsmore convenient for them.
Can you offer click and collect?
Can you offer something that if you wantto buy something in store and reserve it,
you could offer them free delivery lateror something like that, if it's local.
(20:05):
So just thinking about all ofthe different ways that you could
get them to interact with yourstore in different channels.
And I think what is interesting aswell is for ecommerce brands is
thinking about the role of physicalretail or in person retail.
Whether or not it's a pop up, whetheror not it's an event, and thinking
about how that works for you.
But equally so, if you're somebodywho doesn't have a physical store, but
(20:28):
you do events, like how are you movingpeople between your channels there?
Are you encouraging your mailinglist in your social media to
come and see you at the event?
And when you're at the event, are youcapturing people's emails addresses?
Which is, I really stronglyencourage you to do that.
If you're seeing people in person,try very hard to connect with
(20:49):
them and make sure that you cankeep talking to them afterwards.
Because again, if they buy from you inperson, and then they buy from you online,
then they're much more likely to becomea really great regular, repeat customer.
And then the fourth trend we have is AI.
So generative AI is absolutely everywhere.
It's amazing to me to see howquickly this has grown because really
(21:11):
just this time last year we weretalking about it for the first time.
It didn't even make it onto mytrends report for 2023 and it kind
of exploded onto the scene in 2023.
ChatGPT was one of the fastest launchingwebsites in terms of traffic growth
ever and we have seen generative AI.
(21:31):
So specifically, generative AIis AI that can create things.
So AI has been around for years.
I did a talk on AI back in like 2018.
So artificial intelligence and bigdata machine learning, that's been
behind a lot of elements of theretail industry for absolutely years.
So things like, powering your Amazonrecommendations and stuff like that.
(21:53):
But I think what's really just spun itinto another level has been the fact
that it can generate, so generate text.
And I think that we're going tosee it reshape the retail industry
in ways that some are predictable.
Some I think we won't be able topredict until we get a bit further
down, but we're going to see thatreally impact the industry in 2025.
(22:15):
Now I personally think that generativeAI is a huge opportunity for small
businesses because I was having thisconversation with someone the other day
about the fact that obviously there'sa big concern over it impacting jobs.
But in a small retail business where Isee it having value is it's not taking
(22:35):
anyone's job if you never had anyone to dothat job in the first place, for example.
Because basically as a founder, you oftenend up wearing so many different hats.
So you may have well been the personwriting the product descriptions
as well as the emails, as wellas planning out the marketing.
And now you can get support with that.
(22:55):
You don't ever really haveto be stuck for ideas.
Again, this is something that I'm reallykeen to incorporate inside the Resilient
Retail Club in 2025 is specificallytailored AI bots for independent retailers
to help with ideas about sales growth.
Basically, that's what I'm working on.
And I think that there's so manyopportunities to basically make yourself
(23:21):
more efficient, improve your efficiency ina way that it's not about taking away jobs
from other people, but maybe about yougetting to bed before 2am when it's busy.
So for me, that is a big winand a really big opportunity.
And I think that if you haven't thoughtabout using AI or if you've not dabbled
with it, then definitely take a look.
(23:41):
Now, the only thing I will say,the only note of caution about
AI that I, that in the back of myhead concerns me a little bit is I
think it's really great for ideas.
I think it is brilliant for ideation.
So if you are need to come upwith some ideas, then fantastic.
Go ahead.
(24:02):
Do the come up with the ideas using AI.
I do think that there is possibilityor very high probability that the world
has become going to become flooded withmediocre AI messaging because you can
say get it to write this campaign for me.
And if you don't give it moredetail, it's just going to generate
(24:24):
a load of very, very generic stuff.
And then if everyone's doing that,then basically what we're doing
is just creating a lot more noise.
And yes, it's good to be consistent,but if what you're being consistent
with is pretty mediocre, then Ithink that's not necessarily helpful.
So for me, it's going to be aboutoperational efficiency and ideas.
So helping you generate ideas.
(24:45):
But I think the magic will stillcome when you're able to put your own
particular spit on it, as opposed togetting something too generic from the AI.
Now you can put a lot of input intoit and you get better and better
results, the more you put in.
But I think that that would be my caution.
For anyone listening with AI is thinkabout how it can make you better,
more streamlined, more efficient, butalso just watch that you don't lose
(25:09):
some of that humanity as it were.
So there you have it.
Those are my four trends for 2025.
The shift to younger generations,Gen Z, considered purchasing
hybrid retail and generative AI.
I'd love to hear what you thoughtand what you think will be the
big trends for 2025 coming up.
Otherwise, I hope youare having a good break.
(25:33):
We are going to be back next weekwith an interview with the fabulous
Jamie Watkins from Divine Savages,who's part of my mastermind.
Their mastermind cohort forJanuary will be opening soon.
So keep an eye out for that.
And in the show notes, we have got alink to my talk happening on the 8th
of January, which is called from sixfigure years to six figure months.
(25:56):
And we'd love to see you there.
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