2020 taught us that anything can happen. As marketers, we are always looking to take our clients to the next level with a strategic approach to their omnichannel solution. Proven to be most successful, a multi-touch marketing strategy using both digital and print amplifies a brand’s reach.
Most notable for 2020? The accelerated shift to eCommerce due to the pandemic. As the National Retail Federation (NRF) reported: “consumers have embraced online shopping with vigor and retailers have responded with the speedy rollout of new technologies.”
But digital adaptation was always on its way, wasn’t it? We believe there is greater meaning to this changed consumer behavior, which is category expansion. There is a huge opportunity and right now is the time to capitalize on it. Here is our list of hot retail segments for 2021:
- Apparel and Footwear: 31% of consumers planned to purchase apparel this past holiday season and 25% said they would buy footwear. While fast fashion and its environmental effects remain top-of-mind for some, growth will likely continue in the athleisure, loungewear, sleepwear, and luxury fashion categories especially as working remotely continues (source: Forbes). More specifically, the athleisure market is expected to reach $257.1B by 2026, increasing at a CAGR of 6.7% from 2019 to 2026 (source: Allied Market Research).
- At-Home Fitness/Athletic Equipment: In addition to athleisure, at-home fitness continues to surge. According to Allied Market Research, “the global online/ virtual fitness market is projected to reach $59.2B by 2027, growing at a CAGR of ~33% from 2020 to 2027.” Given that this is such a new market, many sources report that while this is the projection, it is expected to exponentially rise as gyms and fitness centers around the world are shut down.
Additionally, the global sports equipment market will likely reach $148.2B in the next two years (source: Statista). Not only is revenue going up, but major players made notable changes: from community-building social media experiences to supply chain adjustments to consumer experiences to partnerships to technological advancements, companies aim to ultimately enhance brand loyalty and customer acquisition.
- Beauty/Skincare: From peel-off face masks to beard oil to serums and treatments to nail polish, this category is gender and age agnostic. In April 2020, U.S. sales of hair clippers and trimmers went up by 241% (source: Criteo). Consumers continue to search for ways to look and feel their best, using the pandemic as a time to reset. This market is expected to reach $806B in two years (source: Morning Dough, Digital Commerce 360).
- Pet Care and Supplies: In 2020, U.S. small animal supplies went up 274% as we noted in last week’s post (source: Criteo). From food to care to supplies, high-volume sales, lower margins and scalability are all factors in the pet category. While PetSmart and PETCO accounted for 48% of total market revenue in 2019, Amazon’s white labeled pet food and retail giants like Walmart and Target expanding their online presence will continue to disrupt, pointing to new trends (source: Common Thread Co.).
- Online Grocery: In September, the Washington Post reported that grocery shopping habits have changed forever, specifically referencing a permanent shift which means less innovation, fewer new brands and more competition for 2021 (source: Washington Post). Sixty-eight percent of consumers bought groceries online for home delivery during the pandemic and 56% bought from Walmart while 50% reported buying from Amazon Prime or Whole Foods. Many of these individuals reported doing so multiple times per month (source: Digital Commerce 360).
- Technology: Adults and children alike are using technology more than ever before. Specifically, they have adapted their behavior to not only remote entertainment but professional and educational responsibilities as well. Since last spring, the pandemic pushed internet usage up to 70% and consumer tech sales increased by 23% YOY (source: Forbes, The Verge).
It appears that video-based technology such as Zoom, Skype, Microsoft Teams, Google Meet, Cisco Webex and others will be a part of our future work environments. Last spring, Zoom reported it had 300M daily meeting participants (compared to just 10M in December 2019) and in October, Teams reported 115M+ daily active users, which is an increase of 53% since April 2020 (source: Tech Republic). Users also needed the tech to support their new remote responsibilities. Monitor sales increased by 73%; PCs were up 53%; microphones were up 147% and webcam sales were up 179% (NPD via The Verge). As systems as well as needs and desires continue to change with the times, many say that these systems have nevertheless created habits that will be with us long-term (source: USA Today).
When focusing on entertainment, it is clear that with new behaviors, came updated expectations in terms of equipment, services, speed and accessibility. Last year, TV sales were up 86% pre-holiday season and video game usage in the U.S. went up 75%” in early 2020 (source: NPD via The Verge and Verizon via Criteo). The most popular social media platforms continue to be Facebook, youTube, WhatsApp, Instagram and TikTok with daily usage increasing (source: Statista). These are potentially untapped new customers who have now changed their day-to-day routines in the last year.
- Home Décor: In October, inventory was down about 20% compared to the previous year while demand continues to be higher than ever. In fact, home prices grew by 16% compared to last year, rising the national median to more than $300K (source: Dave Ramsey).
In addition to new real estate trends, home décor continues to increase in popularity. From home improvement projects to mattresses and bedding to office décor, consumers continue to “nest,” investing in their stay-at-home environment even more. In 2020, outdoor furniture sales rose 428% (source: Criteo). There is an opportunity to build on this growth with additions to collections, product expansion and customer experiences.
Earlier we mentioned the overwhelming behavioral shift to eCommerce. However, what some may not touch upon is that the success brands are experiencing online is directly tied to their entire omnichannel marketing strategy. Therefore, channels like direct mail and print are often responsible for this growth…and we have the success stories to prove it. While we may not know what is exactly in store (pun intended!) for 2021, we are excited about viable new revenue streams in expanding categories and the opportunity to implement enhanced, smarter marketing efforts.