Global Trends Shaping the Next 5 Years

The last few years have taught retailers the importance of resilience in a disruptive economic environment. The path forward may be complex, but our goal at Google is to help retailers and brands navigate uncertainty. Partnering with Kantar and Bain, we analyzed shopper behaviour and identified four critical trends shaping the retail industry over the next three to five years.

Shopping as an Ambient Experience

Today's consumers effortlessly transition across digital, physical, virtual, and social platforms, shifting from browsing and researching to buying. This omnichannel behavior will evolve into an ambient experience, where people discover new products while scrolling social feeds, watching videos, and playing games. This phase of commerce will focus on how close retailers can get to consumers in their preferred spaces.

Key Stats:

Younger shoppers are 2-3 times more likely to shop using emerging media like social media, virtual try-ons, and live streams.        

Brand Loyalty and Partnerships

Brand loyalty is waning as shoppers prioritize companies and products aligning with their values. Retailers need to innovate through partnerships and collaborations to retain customers. Super apps, buy-now-pay-later providers, and loyalty aggregators are becoming significant players in the retail landscape.

Key Stats:

73% of shoppers expect brands to understand their unique needs and expectations.        

The global autonomous last-mile delivery market is projected to reach $90 billion by 2030.        

Online marketplaces will account for 45-50% of online spend by 2025.        

Gen Z: The New Shopping Powerhouse

Gen Z, nearly 30% of the global population, is growing in spending power and influence. Raised in a digital world, they seek input from trusted online sources. Retailers must appeal to their habits and preferences by creating seamless omnichannel experiences and leveraging in-store digital enhancements.

Key Stats:

Gen Z and millennials are twice as likely as older shoppers to say that watching an online video was their most influential shopping activity.        

42% of Gen Z's spending occurs in physical stores, comparable to millennials' 38%.        

Conscious Consumers Seeking Value and Security

Shoppers are now more intentional about value, prioritizing a retailer's overall brand value proposition over lower prices. Higher consumer expectations come with increased scrutiny over personal data. Retailers need a foundation of consented first-party data and apps to build direct customer relationships.

Key Stats:

70% of people are willing to continue buying from companies that increase prices if they feel valued.        

79% of global consumers are concerned about data protection and privacy on the internet.        

72% believe they are at risk from data misuse.        

Takeaway

To stay agile in an ever-changing retail environment, retailers and brands must adapt to a more ambient shopping experience, form strategic partnerships, appeal to Gen Z shoppers, and offer consumers more value and less risk. Embracing these trends will position them for success in the next five years.

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