At NRF’s State of Retail & the Consumer, we hosted industry experts, retail CEOs and market researchers to discuss the strength of the consumer economy and the future of retail.
We also announced our annual retail sales forecast, anticipating that sales will grow between 6 percent and 8 percent to more than $4.86 trillion in 2022.
Against the backdrop of a growing industry, NRF’s State of Retail & the Consumer conversation centered on how retailers are navigating away from the pandemic to the new endemic environment, focused on better understanding the rapidly changing needs of customers and communities.
Here are three key takeaways from the discussion:
“Aspirational Independents” leverage influence
Working with SKDK, NRF uncovered a key swing voter segment that’s growing in purchasing power and influence: Aspirational Independents. This group represents 15 percent of the voting population and has a unique set of overlapping attitudes toward shopping and important policy issues that make them highly valued to retailers and politicians.
Catch up on the 2022 State of Retail and the Consumer event by watching it on demand.
Aspirational Independents are moderate in their views, not tethered to either political party. Demographically, they tend to be younger and more diverse (only 51 percent white), and a significant number are parents. Having fun is their No. 1 priority when shopping. They like exploring a variety of options in their purchasing journey, and they’re always looking for something new. They enjoy shopping all channels, from online to local stores.
When it comes to retailers and brands taking a stand on political or cultural issues, Bill Knapp, partner at SKDK, noted that hypocrisy is kryptonite with Aspirational Independents. “Retailers have to be authentic. If you're going to make a case that the world should be a certain way, you better run your store that way. Otherwise, consumers will see it as just a position to curry favor with them and not true or authentic to what you believe.”
Pent-up demand will keep spending steady
After two years of living during a pandemic, there is pent-up demand to go out, whether that’s traveling across the country for a vacation or across the street to a local restaurant. People are eager to get out and experience things they haven’t been able to experience, said Sharon Leite, CEO of The Vitamin Shoppe.
John Furner, president and CEO of Walmart U.S., believes the resulting spending will be healthy for the economy as a whole: “Someone told me once that innovation happens at the speed of trust and trust comes from knowing the people you work with and those that are around you. The personal connections that are re-established through getting out more and traveling will be a real positive for the entire country and for our business.”
Customers decide terms of engagement
While there might have been some tolerance from consumers for imperfect experiences in innovations rapidly rolled during the pandemic, Furner said the execution has become increasingly important.
“Being able to offer solutions to customers in a flexible manner is going to define the companies that win in the long term versus those who don't."
The pandemic has taught retailers that changes can be made faster than ever before, and that they must engage on customers’ terms, Leite said. “Look at all the different ways that consumers can engage that we wouldn't have necessarily thought were going to be important three years ago. Some of those behaviors are ingrained and will continue, and there will be some new things that come up. We’re going to have to continue to adjust and adapt.”
Furner also called out flexibility and adaptability as one of the biggest lessons Walmart U.S. will take into the future. “Being able to offer solutions to customers in a flexible manner is going to define the companies that win in the long term versus those who don't. Customers [are changing] faster than they've ever changed. The changes can be unexpected, and we have to be ready for them.”
Watch a full recording of the State of Retail & the Consumer for more insights here.
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