4 Retail Trends in 2018

Sometimes change happens so slowly that you’re not aware of it until long after it happened.

2017 was not one of those years.

Brands that have been household names for decades closed their doors or filed for bankruptcy at a time when pureplay ecommerce newcomers entered into the fray and found immense value in opening up their own physical stores.

The term “retail apocalypse” became ubiquitous, and artificial intelligence was once again touted as everything from the savior of retail to the reason civilization will collapse.

As 2018 approaches, I’ve taken some time to reflect over the year and think about what’s to come. Here are 4 of the most important retail trends I believe we’ll see in 2018:


1. Direct-to-consumer strategies will insulate established brands and launch new companies

retail trends in 2018

As department stores continue to close retail locations, established brands are quickly realizing they need more direct relationships with customers to insulate themselves from the potential lost revenue of closed stores.

This desire to own more of their destiny by not building their house on fragile land will cause them to invest heavily in direct-to-consumer strategies. This will drive customer engagement innovation and will continue to upset the brand/wholesale relationship.

Similarly, new direct-to-consumer brands will launch, further disrupting the retail industry. This landscape continues to grow as brands like Allbirds, Casper, Warby Parker, and others upend retail brand verticals with their unique product offerings and expanding footprint of well-executed stores.

In our highly digital and social media-driven product world, this new era of brands will continue to redefine both what it means to be a consumer brand and how brick-and-mortar stores should operate.


2. Retailers will demand practical examples of AI

A practical AI example

In the emerging technology hype cycle of 2018, we will discover whether or not artificial intelligence is at the Peak of Inflated Expectations, the Slope of Enlightenment, or both.

Retailers’ interest in AI is piqued. In fact, a Forrester study found that 51% of brands are implementing, have implemented, or are expanding their use of AI.

In 2018, we’ll learn if the available AI-powered solutions are actually delivering the results that retailers and consumers alike are expecting from them (hint: they’re expecting a lot).

The companies that are shouting the loudest about AI will be forced by retailers to put up or shut up, which means they’ll need to show accessible and transparent examples of how AI is driving revenue, stronger customer engagement, and better customer experiences on-site and off.


3. Individualization will go from buzzword to urgent initiative

retail trends in 2018

For years, retailers have lagged behind how apps and other cutting-edge technologies are engaging shoppers on a personal level. This lagging behind has cost them revenue, sure, but it has also widened the chasm between what they’re delivering and what consumers are increasingly expecting.

Individualization was all the buzz in 2017, and retailers now realize they need to truly make themselves Customer-First brands. It’s no longer a question. The technology is there, the customer expectation is there, and the proof of greater revenue is there. In 2018, retailers no longer have excuses to hold onto.

They’ll need to finally embrace omnichannel, fully understand the moment-to-moment experiences of the customer journey, and begin to replace the segmentation they’re comfortable with for the individualization their customers are demanding.


4. The giant battle between Amazon and Walmart will rage on

Amazon and Walmart will offer a glimpse into the retail trends in 2018
Throughout 2018, both juggernauts will continue to play to their advantages and try to acquire companies that shore up gaps in their weaknesses.

Both behemoths will redefine the concept of an all-encompassing department store in the digital era, and in doing so they’ll set new customer experience bars that all retailers will be forced to compete with.

To be clear, the next 12 months of Amazon vs. Walmart won’t happen in a silo. Every punch the other throws will ripple through the entire retail industry. Retailers everywhere shouldn’t just be tuning in, they should be taking notes.


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retail trends in 2018

Kurt Heinemann

Kurt is Reflektion’s CMO. His resume includes CMO positions at Marketwired and Monetate. He’s also held senior executive positions at Priceline, Time Warner and Walker Digital Companies. Despite living in Yankees territory, Kurt is a die hard Tigers fan.