December 20, 2021
Consumers and businesses are likely to keep spending in 2022. While rising inflation may concern investors, Morgan Stanley reports that U.S. supply chains are on the verge of recovery, indicating a leveling off of prices that should pave the way for a robust 4.6% GDP rise in 2022. But what are the consumer trends that will emerge next year? For the most part, it will be a continuation of the trends that have persisted as a result of the pandemic.
E-Commerce is a Big Winner
E-commerce continues to be the biggest market winner in 2021 and is expected to continue to grow in 2022. Forrester, a research and advisory firm, calculated that 44% of U.S. consumers upgraded their in-home technology and 60% of online adults made e-commerce transactions for the first time this year. As a result, e-marketplaces have invested billions in building out e-commerce infrastructures, improving online shopping experiences and integrating supply chains. Amazon.com Inc. (Tii:AMZN), Walmart Inc. (Tii:WMT), eBay Inc. (Tii:EBAY), Apple Inc. (Tii:AAPL) and Home Depot Inc. (Tii:HD) should be the big winners of this dynamic. Market research firm Statista estimates these retailers hold 58% of the U.S. e-commerce market share collectively.
More Real Stories in Advertising
During the rise of social media and the celebrity influencer, marketers hopped on the opportunity to align their products with superstars and others with large followings by cutting deals for them to use branded products in videos and posts. However, market research and data analytics provider GWI reports that consumers are becoming less interested in celebrity influencers. Instead, real stories and authentic experiences are resonating greater with consumers. NIKE, Inc. (Tii:NKE) is one retailer that has pivoted due to this trend, creating commercials featuring actual customers in its videos. The sports apparel provider also removed the hard sell and subtly included branded gear strategically placed in ads to draw consumers toward a narrative.
Wellness and Self-Care are Higher Priorities
The pandemic shined an intense spotlight on the importance of health and wellness. As a result, consumers are looking at new ways to keep their bodies and minds operating at peak performance. This trend benefits companies in a multitude of industries – including fitness center operator Planet Fitness Inc. (Tii:PLNT), molecular diagnostics tech manufacturer Co-Diagnostics, Inc. (Tii:CODX), health I.T. services provider Cerner Corp. (Tii:CERN), at-home fitness equipment distributor Peloton Interactive, Inc. (Tii:PTON) and digital telemedicine operator GoodRx Holdings (Tii:GDRX).
Popularity of Mobile Apps Increases
Mobile apps continue to dominate the digital marketplace as consumers spend increasing amounts of time gaming, streaming shows, ordering food, and engaging in e-commerce. OneSignal, a customer messaging & engagement solutions provider, reports that consumers spent 8% more of their time using their mobile devices than they did watching television in 2021. This will create greater opportunities for e-retailers to advertise and roll out apps to capture these consumer dollars. While this undoubtedly benefits every e-retailer with a mobile app, it may also result in increased market penetration for digital payment platforms like those provided by Block Inc. (Tii:SQ). The company, which changed its name from Square Inc. on December 10th, is the parent of point-of-sale systems provider Square and mobile payment service Cash App.
Sustainability is a Must
The pandemic boosted global awareness of environmental issues and sparked a renewed commitment to finding solutions. And consumers are holding the companies they support through purchases and investments accountable for establishing genuine sustainability objectives. Insider Intelligence, a research service focused on digital transformation, expects calls for action to grow louder in 2022. The research firm says corporations are falling in line, citing commitments to carbon neutrality timelines from Apple, Google parent Alphabet Inc. (Tii:GOOG), and Facebook parent Meta Platforms, Inc. (Tii:FB).
While we won’t know for sure which trends will dominate once 2022 is well underway, these five seem the most likely to prevail. But as is typically the case in business, there will be curves thrown, and new trends will emerge – and the companies that adapt quickest to them will stay on the right side of these new dynamics.