MasterCard：2023年旅游行业趋势

Topretailtrendsin2023

THOUGHTLEADERSHIP

DECEMBER2022

TOPRETAILTRENDSIN20231

TOPRETAILTRENDSIN20232

Contents

4Economicoutlook

6Understandingconsumers

11Reachingconsumers

14Keepingcustomers

19Payingforpurchases

23Shoppingin-storeandvirtual

26Conclusion

TOPGLOBALRETAILTRENDSIN2023:HOWTHEECONOMYANDCONSUMERSARESHAPINGTHERETAILINDUSTRYPOST-PANDEMIC2

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INTRODUCTION

Howtheeconomyandconsumerswillshapetheretailindustrypost-pandemic

Soonafterthepandemicmadeitswayaroundtheworldin2020,peoplestartedtalkingaboutthe“newnormal.”Threeyearslater,theworldisstillgrapplingwithhowtodefineapost-pandemiclife.

Theglobalretailindustryhasbeendealingwithoneofthemostuncertainandevolvingmomentsinrecenthistory.Whilemanyofthe2023retailtrendsdetailedinthisreporthavebeenaround,theywilltakenewtwistsandturns,dictatedbyanever-evolvingconsumerandeconomy:

Inflationisimpactinghouseholdbudgetsbutconsumersarestill

fulfillingtheirpent-updemandfortravelandexperiences.

Choiceiskeybutconsumersdon’twanttobeoverwhelmedby

messagingandoffers,increasingtheexpectationforpersonalization.

Privacyismoreimportantthaneverbutpeoplewantbrandsto

understandthem.

Curbsideserviceandotherconveniencesbornefromthepandemic

areheretostaybutpeoplealsowantnewexperiences.

Asconsumersstart2023,ayearwiththefewestrestrictionssince2020,theywillexpectchoicesinhow,whenandwheretheyshop.Retailersthatanticipatecustomerneedsandpivottomeetorexceedthoseneedswillseethestrongestresults.

Inthisreport,weexplorethefollowing2023trendstowatcharoundtheglobe:

Howtheeconomyimpactsconsumerchoice

Theevolvingroleofdataandanalyticsinshapingthecustomerexperience

Emergingandinnovativewaystoreachconsumersastheytraverseonlineandofflinechannels

Theroleofloyaltyincultivatingaffinity

Expandingpaymentchoicesandshoppingexperiences

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01

Economic

outlook

4

ECONOMICOUTLOOK

“Thereisevidence

ofconsumershifts

ingroceryspending

insomecountries,

withhighfood

inflationdriving

consumersto

shopin-person

morefrequently

andspendless

pervisit.”

Winnersandloserstrade

placesin2023asweseea

reversiontothemean

Undoubtedly,risingglobalinflationisimpactingconsumersindifferentways.They’remakingdeliberatepurchasingchoicesbasedontheirownpersonalneedsandeconomicsituations.

Manyconsumersarerespondingtohigherinflationbyoptingforcheapereverydayspendoptionstocontinuespendingonexperiencesliketravelandeatingout,accordingtotheMastercardEconomicsInstitute.Thereisevidenceofconsumershiftsingroceryspendinginsomecountries,withhighfoodinflationdrivingconsumerstoshopin-personmorefrequentlyandspendlesspervisit.Thiscouldreflect“tradingdown”tolessexpensivebrandsandstores,andsimplypurchasinglesstoavoidwasteandbettermanagetheirgrocerybudgets.

Indiscretionaryretail,whichincludescategorieslikefurniture,electronicsandapparel,consumersgloballyarespendingless,potentiallyreflectingtheretaildemandthatwas“pulledforward”earlyinthepandemic.Similartogroceries,thiscouldreflectashifttolessexpensiveoptionsandconsumerspendingpriorities.However,incontrasttogroceries,consumersarenotincreasingtheirin-personshoppingfrequencyasmuch.

In2023,theMastercardEconomicsInstituteexpectsspendingontravelandexperiencestocontinuerisingasashareoftotalconsumerspending,whiletheshareofbig-ticketdurablegoodsdeclines.Thedifferencesininflationwillfuelthisdynamicasinflationacceleratesforservicesanddeclinesforgoods.

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02

Understanding

consumers

6

UNDERSTANDINGCONSUMERS

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Uncertaintimescallforverycertaindataandanalytics

Text,social,email,ads.Consumersaremanagingasteadystreamofmessagesvyingfortheirattention.

Forretailers,theartofconnectingwithconsumersiscomplicatedbyawiderangeoffactors,fromtheeconomy,weathereventsandinflationtohealthconcerns,dataprivacyandsocialissues.Withthesediversedynamicsatplay,dataandanalyticsarecriticalforhelpingretailersunderstandpurchasedecisionsandthetypesofexperiencestheyshoulddeliver,whilebecomingmoreagileintheprocess.

.

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UNDERSTANDINGCONSUMERS

Understandinghowconsumersreacttoeconomicchanges

Economicheadwindsimpactedconsumerwalletsin2022withshoppersmakingdeliberatechoicesabouthowtospendtheirmoneyastheyweredealingwiththeirpent-updemandforexperiencescoupledwithinflationandrisinggasprices.1

Withmoreeconomicuncertaintyexpectedthrough2023,thereisevenmoreneedtounderstandeconomictriggers(layoffs,risinggasprices)andconsumerreaction(lessdiscretionaryspending),aswellasothermacro-influencersonconsumerspendinglikeweatherandcovid.

AccordingtotheMastercardEconomicsInstitute’soutlookfor2023,theimpactofinflation,interestratesandconsumerspendingwillbefeltdifferentlyaroundtheworldbasedonfactorslikefiscalpoliciesandincomelevels.

Forexample,thegapindiscretionaryspendingbetweenhigh-andlow-incomehouseholdsremainswide.Althoughinflation—theincreaseinthepricesofgoodsandservices—isexpectedtosoftenin2023,pricesarebroadlygoingtoremainhigherrelativetowheretheywerebeforethepandemic.

In2023,theresultingeffectfromlessinflationcouldmeanthatdiscretionaryspendingbylower-incomehouseholdscatchesupclosertodiscretionaryspendingbyhigher-incomehouseholds.However,therisksremainwide.Forexample,labormarkettrepidationscouldbeaheadwindin2023despiteinflationcoolingoff.

Understandinghowtoadaptthroughtesting

Testingnewideasforproducts,storesandexperiences,includingcontent,messaging,recommendationsandoffershasalwaysplayedaroleinretail.Now,basedonfast-movingchangesintheglobaleconomy,retailerswillrelymoreheavilyonomnichannel,nearreal-timetestingtounderstandthebestwaystorespondtoconsumerpurchasingchoices.Thisisparticularlyimportantasalargerpoolofconsumersrespondtooffersandpotentiallystartstotradedownontheirproductchoices.Pricingstrategiesmayalsostartadjustmentsbasedoneconomictrends.

Risinginflationmayinspiremorepeopletorespondtooffers,butonlytheonesthatappealtotheirpreferences.Retailerswillwanttheabilitytosegmentthecustomerswhoareoffer-drivenversuspeoplewhouseanofferoutofconvenience.Inadditiontofocusingonselectcustomersegments,retailerswilllooktoanalyticaltoolstooptimizethepromotionandmessaging.

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UNDERSTANDINGCONSUMERS

Assomeconsumersbecomemorecostconscious,theycouldalsostarttotradedownsomeoftheirproductchoices.Retailerswillwanttotrackwhichtypesofproductsthey’rewillingtotradedownandhowthatdictatestheiroffersforhigher-ticketproducts.

Inflationisalsoimpactingpricingstrategiesacrosstheretailindustry.Companieshavealwaysbeenchallengedwiththerightbalancebetweenincreasingpricesandpriceelasticityoverconsumerexpectations.Butthebalancewillbecomeevenmoredelicateastheeconomycontinuestoebbandflowin2023.Testingwillbecomeevenmorevitalascompaniesworktokeepcustomers,attractnewonesandstaynimble.

Bothreal-timeandnearreal-timebusinessexperimentationcanalsoprovideinsightsonin-storetrafficandhelpretailersflextheirstaffingneedsandhoursofoperationbasedonwhenconsumersaretransacting.In2022,someretailerssawlessactivityintheirformerlybustlinglocationsnearcommercialhubsandinvestedmoreintotheirsuburbanlocations.Butthequestionofwhethervirtualworkenvironmentscontinueremains,andretailerswillneedtoadjusttheirphysicalfootprintstostaycurrent.

Understandinghowtomakepersonalizationreallywork

Personalizationisnolongeranice-to-havebutabusinessrequirement.In2023,moreretailerswillworktocollect,consolidateandputmeaningfuldataintoactionforthepurposesoftailoringcommerceexperiencesthatmovetheneedle,whetheronlineorin-store.

Manybrandsstrivefor1:1personalization.Butwithoutapplyingtherightconceptsoutofthegate,thiscanbringunnecessarycomplexityandpreventpersonalizationstrategiesfromdrivingsignificantandmaterialbusinessimpact.Instead,personalizationstrategiesshouldbedevelopedfromrootaudiencestoensurethatlearningsarescalable.

Thisframeworkismeanttohelpcompaniesestablishatestingandoptimizationprogramtoprovideallcustomerscuratedandpersonalizedexperiencesbasedonclick-stream,affinity,loyaltyandotherbehavioralorcontextualdata.Thisallowsforscalabilityandmaximumefficiency,withteamsabletomoreeasilyinstitutionalizelearningsaboutcertainaudiencesandoptimizeexperiences(content,offers,messages,recommendations)forthemovertime,drivingincrementalengagement,conversionandrevenueacrossallwebsitetraffic.

Oncepersonalizationeffortsarewellunderway,furthergainscanbeachievedthroughartificialintelligenceanddeep-learningrecommendationalgorithms.Thisiswherealgorithmicproductrecommendationsshouldbelayeredonfortrue1:1personalization,withdynamicallyallocatedcontent

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UNDERSTANDINGCONSUMERS

andrecommendationsservedtotheconsumeraccordingtoaffinityandhistoricalpurchases.Theconstantlearningimpactwillyieldaflywheeleffect,drivingrelevanceandanever-improvingcustomerjourney.

Further,retailerswilllookbeyonddigitalchannelstodeliverpersonalizedexperienceseverytimeaconsumerinteractswiththeirbrand(store,web,mobile,email).Traditionalbrickandmortarandotherassistedchannelshavetheopportunityforinnovativeadvancementthroughtheintegrationofdigitalcapabilities,furtherenhancingtheunifiedcustomerjourney.Theinfographicbelowprovidesprovidesanexampleofhowpersonalizationcansupportthecustomerjourney,informingaretailsalesrepresentativetopersonalizewhatcanbeanincreasinglywhitegloveexperienceforagivencustomer.

Thepersonalizedjourney

Step1Step2

AsalespersoninThesalesrepprovides

aphysicallocationthemrecommendations

accessesashopper’sbasedontheirpurchase

up-to-datecustomerhistoryandmostrecent

profile(uponconsent)browsingactivity(upon

viatabletoranin-consent).

storekiosk

10

Step3

Thecustomerthenreceivesoffersandpromotionswhilethey’reinthestorethataretailoredtothem.

Step4

Thisofflinepurchasedatacanthenbeonboardedtoensuretheretailerdoesn’tcontinuetorecommendtheproducttheypurchasedbutinsteadhighlightsitemstypicallypurchasedwithittoencouragecross-sellingoncetheshopper(re)visitsthesiteagain.

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04

Reaching

consumers

11

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REACHINGCONSUMERS

Reachingconsumersbecomesagameofdiversificationbalancedwithprivacy

Fromretailmedianetworkstosocialcommerce,retailersaredoublingdownonthe‘omni’inomnichannelastheyexpandtheirreachvirtuallyandinperson.

160

billion

Projectedtotalglobalretail

mediaspendby20272

42%

ofcompaniespredictthe

removalofthird-partycookies

willleadtolowerreturnon

theirmarketingspend6

Reachingcaptiveconsumersthroughretailmedianetworks

Retailmedianetworks—digitalchannelsownedbyaretailcompanyandofferedtothird-partybusinessesforadvertisingpurposes—havegrownquicklyin2022andwillcontinuetogrowin2023.Advertisingonretailmedianetworksisexpectedtoreach20%ofU.S.digitaladspendin2023,accordingtoGartner.Globalretailmediaspendwasprojectedtoreach$101billionbytheendof2022andtotalglobalretailmediaspendcouldhit$160billionby2027,whichrepresentsa60%growthrateoverfive

years.

2

ThesenetworksallowretailerssuchasU.S.-basedUltaBeauty3andKroger4toselladstovendorbrandstoreachprospectswhoarealreadyinaspendingmood.Fortheretailerwiththeplatform,itgivesthemanadditionalstreamofrevenue;forthecompaniesthatadvertiseonthesenetworks,itgivesthemanotherwaytoreachcaptiveconsumersandtheconsumerinsightsprovidedbytheplatform.

Onereasonretailmedianetworksaregrowingisconsumerprivacy,includingtheadoptionofmoreprivacyregulationsandAppleallowingiPhoneuserstooptoutofallowingappstotracktheiractivityacrossothercompanywebsitesandapps—96%ofiPhoneusersarechoosingtooptout.5Theremovalofthird-partycookiesonGooglebrowsersby2024willalsohaveabigimpactonthewaycompaniesreachconsumers.Aglobalsurveyof3,450businessleadersand4,500consumersfoundthatmorethanhalfofcompaniesarenotfullypreparedforacookielessworld.Inaddition,42%predicttheimpendingchangeswillleadtolowerreturnoninvestmentontheirmarketingspend.6

Whiletheimportanceofgivingconsumerscontrolovertheirprivacyhasopenedthedoorforretailmedianetworks,morebroadlyit’screatedurgencyforretailerstocommittodataprinciples.Retailerscanbuildtrustwithconsumersbyadoptingatransparentandcontrolledwaytoprotectandmanagedataandallowconsumerstoownit,controlitandbenefitfromtheuseofit.

REACHINGCONSUMERS

Reachingconsumerswheretheyspendmostoftheirtime

Retailerswillmakebiggerinvestmentsinsocialcommerceasconsumersspendmoreoftheirtimeonsocialchannels.ThisisparticularlyimportantforengagingwithGenZandyoungergenerations,soawell-thought-outplan

724

billion

Inrevenuegeneratedfrom

socialcommerceworldwide

in20227

31%

Compoundannualgrowth

rateexpectedfrom2022

to2030insocialcommerce

worldwide7

andinvestmentinthisspacegivesbrandsalegupforfuturegenerations.

BrandsareinvestinginInstagramandTikTok,whereconsumersarefirstinteractingwithbrandsthroughstrategiccontentplacementandinfluencernetworks.They’remakingin-apppurchases,receivingexclusivediscountsandavoidinghavingtoleaveasocialchanneltopurchasethehottestnewpairofNikeshoesorthelatestmake-upcolorsfromMACCosmetics.NewopportunitiesareemergingtofurtheroptimizetheseexperiencesthroughthepersonalizationofproductsthatarefeaturedalongsidethemeitheronthesiteorviaYouTubeandothersocialcommerceplatforms.

Worldwide,socialcommercegeneratedabout$724billioninrevenuein2022andisseeinganexpectedcompoundannualgrowthrateofnearly31%from2022to2030.7

Walmartexpandeditslivestreamshoppingcapabilitiesinlate2022throughapartnershipwithFirework,avideoe-commercesolution.Thearrangementbringsshoppable,short-form,socialmediastylevideostoWalmart’sdigitalpropertieswhilealsomakingthemavailabletoadvertisers,creatingavideocommerceexperience.8Thecompanyisnowexpandingitssocialcommerceofferingwiththelaunchofitsplatformthatallowscreatorstomonetizeshoppableproducts.9

Socialcommerceisgrowingasconsumersrelyonsocialmediaformorethandancevideosandin2023,moreretailerswilllooktoplayinthisspace.

13

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05

Keeping

customers

14

KEEPINGCUSTOMERS

Keepingcustomersgoesbeyondpointsandrewardsprograms

53%

ofconsumershavesoughtoutcheaperalternativesinatleastoneproductcategory.

Whencustomerexperienceencouragesongoingengagementandbuildsadeeperrelationship,loyaltyisthedirectresult.Savvyretailersrecognizethatloyaltygoesbeyondwhatthecustomerisbuying—andbeyondpoints.

Giventheeconomicenvironment—onewherecompetitionforcustomers’walletsisintensifying—retailerswilllookforinnovativewaystokeeptheircurrentcustomers.Loyaltyprovidesavaluablemeansofgatheringconsentedcustomerdataandpreferences,whichinturn,providestheplatformtomarketandcommunicaterelevantcontentthatretailerswillusetodrivesalesandshiftstock.

Keepingcustomersastheymakedifficultchoices

Againstthebackdropofanunfamiliarglobaleconomy,consumersaremakingdeliberateshiftsinwhat,whereandhowtheyspend.10Whenperiodsofeconomicchangehappen,customerloyaltycanbecomeevasive.

Thefearisnotunfounded.AccordingtoasurveyofU.S.consumersbyGartnerinSeptember2022,53%ofconsumerssaytheyhavesoughtcheaperalternativesinatleastoneproductcategory.Butwhilesomeconsumersmaybewillingtotradedownoncertainpurchases,otherswillprotecttheirfavoritebrands.Morethanhalfofconsumers(52%)saytheywill,attimes,remainbrandloyaleveninthefaceofinflation.Halfofthatgroupiswillingtopayahigherprice.

Someretailerslookingtoreduceexpensesmightbetemptedtocutbackontheirloyaltybudget.Buttheprevailingviewofmostretailersisthatcustomerloyaltyisnotacostcenter,butaprofitable,revenue-generatingplatformandapowerfulcustomerengagementtool.Whetherit’sagrocereliminatingthefreecoffeetheybeganofferingshoppersduringthepandemicandthensuddenlyreversingthatdecisionduetocustomerbacklash,orafashionbrandchangingtheirpolicyovernighttorequiremorespendtoearnthesamerewards,thepotentialfornegativeimpactonrevenueandharmtoabrandinthelongterm,mustbeweighed.Foritspart,globalbig-boxretailerCostcohasvowedtoneverchangethe$1.50priceofitsfamousfoodcourthotdogandsodacombo.11

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KEEPINGCUSTOMERS

“Whenabrandcanencouragepositivebehavioronarepeatbasisfromtheirbestcustomers,thatwillhaveagreatercumulativeeffectthanaone-timebehaviorfromacustomerthatdoesn’treturntothebrand.”

Keepingcustomersbyrewardingbehaviors,notjustspend

Innovativebrandswillgobeyondthe“pointsfordollarsspent”model.Consumersnowexpectbrandstorecognizetheirloyaltythroughsmallmeaningfulgesturesthatofferimmediategratification.Forexample,apurchasemayimmediatelytrigger$5offfortheloyalcustomer’snextpurchase.Retailerswillalsoexpandtheirloyaltyofferingsbeyondpointsbypromotingexclusiveexperiencesthathelpdriveloyaltyprogramobjectives.

Whetherit’sarewardformakingtheirfirstpurchasefromtheapporreferringafriend,helpingcustomersfeelpartofthebrand’sfamilygoesalongwaytocreatingbrandloyalty.

Someretailersaregoingbeyondtraditionalloyaltytacticstomakecustomersanactiveparticipantinthebrand.CanadianfurnituremakerRoveConceptsofferstheRoveHostPrograminwhichRovemembersoffertheirhomesasadefactoshowroomandsharethemvirtuallywithotherconsumers.TheseRovehostsearnpointsforeachcustomerinteractionandearlyaccesstonewproducts.

Keepingcustomersthroughsustainability

Consumersareincreasinglyawareofwhattheirfavoritebrandsrepresentand,ledbyGenZ,demandforincreasedsustainabilitymeasuresisonlyexpectedtogrow.12In2023,retailerswillseekconcretewaystotietheirloyaltyprogramstotheirenvironmentalandsocialeffortstodemonstratetheircommitmenttosustainablepractices.

Ongoingpositivebehaviorfromabrand’sbestcustomerswillhaveagreatercumulativeeffectthanaone-timebehaviorfromacustomerthatdoesn’treturn.Innovationisrequiredtohelpencourageenvironmentallyfriendlyactionsfromcustomersandloyaltyprogramsareaneffectivewaytopromotesustainabilityandeffectrealchange.Personalizationtechnologyisonetoolthatcandeterminewhichcustomershaveahigheraffinitytoclimateconsciousproductsorservices,whichhelpsshapetheexperiencebrandsdelivertoreflectthatinterest.Forexample,acoffeeshopmightrecommendalowercarbonproductlikeoatmilkasasubstituteforcow’smilkinacoffee.Retailerscouldevengoastepfurther,offeringthemadiscountonthesustainableproductordonatingacertainportionoftheproceedstoarelevantcause.

Keepingcustomersbyexpandingpaidmemberships

Paidmemberships,alsoknownassubscriptionorpremiumloyalty,createpowerfulvalueforthecustomerwillingtopayafeetounlockbenefits.In2023,retailerswillusethisconceptinvariousways,fromcreatingclubsthatplaytotheircustomers’intereststoaddingapaidmembershiptiertotheirexistingloyaltyprograms.Whilethepaidmembershiptrendwillcontinuein

KEEPINGCUSTOMERS

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“Paidmemberships

requirecareful

considerationto

ensurethatthe

propositionbrings

goodvalueto

customers,but

whentheyare

successful,they

cancreate

ahealthynew

revenuestream.”

“Bestpracticeco-

brandprograms

willintegratetheir

valueproposition

withtheirloyalty

programs,by

extendingeven

morepreferential

benefitstowhat

shouldbethemost

loyalcustomers.”

2023,it’sonethat’sbeengoingstrongforsometime.Withtheproliferationofoptions,it’spossiblethatconsumerswillbegintosufferfromsubscriptionfatigue.

Subscriptions