AI, The Middle East Retail Opportunity, and Peak Shopping Trends in light of the Cost of Living Crisis

In this week's Friday Five, we dive into the insights and takeaways fuelled by a big week for eCommerce as the eCommerce Expo took place in the UK.

With a spotlight on the eCommerce Expo, and an event with British Beauty Council and BeautyMatter here are the five updates from eComplete this week.

1. AI: The Dawn of Retail Automation: It's no surprise, artificial intelligence (AI) featured in many conversations, showcasing retailers' keen interest in harnessing its capabilities to automate processes and enhance efficiency. However, the key takeaway is that we are no doubt still in the early stages of AI adoption.

A notable reminder came from Shopify's Managing Director for EMEA, who reinforced "Shopify Magic" as a suite of accessible AI tools. This suite comprises free AI-enabled features seamlessly integrated into Shopify's products and workflows. A good one to use as a test bed, as we explore AI and how it can help accelerate eCommerce.

2. Internationalisation: Navigating Global Opportunities: The theme of internationalisation and global expansion resonated strongly, emphasising the pursuit of profitable globalisation. While stability is still gradually returning post-COVID, the ongoing cost-of-living crisis continues to exert pressure on businesses.

As for market dynamics, the Asia-Pacific (APAC) region still holds opportunities for growth. However, it was the Middle East that captured the collective attention of many conversations.

3. The Middle East: A Market of Intrigue: The Middle East conversations continued to gain momentum as we joined the British Beauty Council and BeautyMatter at their Middle East Beauty Opportunity Event. With a lot of intrigue, and a desire from retailers to learn about the market, the event shed light on the Middle East's potential. Standout figures revealed that the beauty industry in the Middle East and Africa is set to reach an astonishing ￡47 billion by 2027. With an average age of 32 and a population where 75% are expatriates, the region presents a high potential for consumer spending. Furthermore, the Middle East boasts one of the world's highest rates of digital consumption, at an impressive 82%.

The central question that emerges is how this digital consumption translates into eCommerce success?

It was clear that the key message was the critical importance of localisation and regionalisation strategies, spanning supply chain management all the way through to communication and marketing, as routes to success in this dynamic market.

4. UK's Peak Shopping Trends Amid Economic Challenges: As the peak season approaches, concerns regarding the cost of living crisis have come to the forefront of UK consumers' minds. Research conducted by Retail Economics and Auctane revealed that UK households will have ￡3 billion less to spend this Christmas. So what does this mean for retailers?

Savvy shoppers are adapting to this new economic reality by starting their Christmas shopping earlier and turning to online marketplaces to maximise their budgets and minimise overall spending.

Impressively, 40% of UK consumers intend to begin their Christmas shopping before October, with 15% already having commenced in August.

Projections suggest that UK consumers will spend a substantial ￡17.9 billion on online marketplaces during Black Friday and Christmas, driven by their quest for competitive prices.

We've seen it in recent years, but there is no doubt retailers are expected to extend their Black Friday and Cyber Monday (BFCM) activities, capitalising on consumers' growing preference for extended periods of bargain hunting, and their desire to manage budgets effectively over longer shopping periods.

5. The Human Touch in Branding: A Community-Centric Approach: The power of a community-centric approach continues to hold sway. Brands like Adanola, Represent, and TALA have effectively demonstrated the impact of building communities around their products and values. Candy Kittens, known for its sweet treats, echoed this sentiment by emphasising the effectiveness of humanising the brand. They found that emails signed off by a human performed significantly better than those sent directly from "Candy Kittens." This reinforces the importance of establishing personal connections and resonating with consumers on a human level as you continue to drive community and customer engagement.

And that's it for this week's Friday Five.

We'd love to hear your thoughts, we look forward to seeing you next week.