As the year comes to a close, and we approach NRF Retail’s Big Show, taking a look back is a valuable exercise. In this industry, historical trends can lend insight into what is to come—and the significant progress the industry’s made in the last few years make that insight even more important. Over the last 12 months, retailers doubled down on their COVID-era investments in connected enterprise systems to optimize their operations in new ways. With a consumer base that continues to enjoy brick-and-mortar shopping while also becoming more comfortable with the store’s offerings of alternative fulfillment services than ever before, retailers had more freedom to explore and innovate to discover the next best thing in retail.

While the year did bring some challenges like rising inflation, ongoing supply chain issues, and more, the industry continues to prove its resilience and flexibility. Retailers adapted as the business landscape changed, and that agility laid the groundwork for a very exciting future. Here are some retail trends we expect to see ramp up in the new year:

During the past three years, retailers focused on expanding their omnichannel presence, optimizing “buy online, pick up in store” (BOPIS) and curbside pickup programs, and streamlining stores to reduce customers’ risk of COVID exposure. Research shows that by early 2021, half of the top 1,000 retail chains offered curbside pickup, up from only 6.6% a year prior. These omnichannel services aren’t going anywhere. However, with health and safety concerns continuing to wane, retailers will take time to focus on making in-store shopping a sought-after experience.

No matter how strong a pull convenience has over consumers, there are certain irreplaceable elements of the in-store shopping trip that consumers value. For example, customers report that they like the experience of in-store shopping because it allows them to interact with products in real time. Retailers will likely lean into this in the coming months, using shopper traffic data to reimagine floor layouts that encourage browsing and exploring. By using shopper journey insights to help mitigate crowding on the floor, retailers can help customers feel more comfortable taking time to interact with products and displays throughout the store.

While AI is likely to become common in retail in 2023, other emerging technologies may need some more time to gain traction.

In the next year, retailers will focus on technologies that strengthen their foundation in 2023. Computer vision and other AI applications that streamline the operations side of the equation will take center stage as retailers focus on consumers’ preferences for convenience.

However, if we look farther down the retail road, it will take some time for the industry to uncover meaningful ways for augmented and virtual reality to improve the in-person shopping experience. As customers become more comfortable with these offerings in their everyday lives and new applications are devised, reality-bending tech is likely to work its way onto sales floors—but that’s unlikely to happen in the next 12 months.

Despite increased interest in emerging technology, retailers who focus on getting the basics—smooth checkout processes, competitive deals, customer loyalty programs, and more—right will be rewarded for it. Convenience and price ruled the holiday season, and they will continue to reign supreme in the coming year as customers become more selective about where to spend their hard-earned money and within their limited time.

With this in mind, retailers may want to prioritize perfecting the fundamentals before they explore new models. Analytics and intelligence suites can help them do just that. Taking a holistic look at in-store shopper traffic patterns, most frequently purchased items, most popular deals and more can help retailers glean insights that help them take actionable steps toward a better store and integrating these insights into a single platform can highlight the ways different factors interact.

For example, data from cameras and point-of-sale data may show that a particular bay of registers is routinely slowed by the placement of an end cap with a best-selling item. With this information shared side-by-side, store managers will know that adjusting the placement of the item will help checkout lines flow more smoothly and make shopping more convenient.

With the continued availability of multiple fulfillment options and the challenges within the supply chain at present, inventory intelligence has become more and more important. Consumers’ focus on convenience in the coming year will lead retailers to seek out ways to leverage inventory intelligence to improve traditional, in-store shopping as much as they have alternative fulfillment measures.

In-store, BOPIS, and curbside shopping do not exist independently from each other, and the ways they interact will become more apparent as in-store shopping gains even more ground in 2023. When the store itself acts as a mini fulfillment center, issues with any of these experiences ripple out to affect the others. As such, retailers will also continue to improve their omnichannel delivery to facilitate higher sales. BOPIS and curbside pickup customers often make extra purchases at the register. Retailers will pursue ways to capitalize on those purchases with strategic placement of popular products and personalized deals via brand apps.

Shrink is at an all-time high in the US, accounting for 1.62% of a retailer’s bottom line, costing the industry around $62 billion. We predict as we move into a post-pandemic world, retailers will prioritize and use data intelligence to more effectively and efficiently mitigate shrink and Organized Retail Crime (ORC). As a result, we expect to see more LP professionals continue to invest in tools to combat shrink. According to a recent NRF survey, 50% of LP professionals said their organization was allocating additional technology resources and another 50% said they were allocating additional capital specifically to LP equipment.

The past few years have seen sustainability take center stage for many consumers, and retailers followed suit. Concerns about environmental protection will continue to affect how retailers conduct their business in 2023 and beyond, especially as more municipalities, states and federal governments adopt policies regulating sustainable business practices.

The impact of these policies and their own CSR goals will be reflected in retailers’ loss prevention programs, supplier choices, food preservation investments, and more as they work to reduce waste and create efficiencies wherever possible. These efforts, while an investment in time and resources at the outset, can offer big payoffs in customer loyalty. Over 70% of consumers say they would change their shopping habits after learning a brand isn’t operating sustainably.

Digitalization has led customers to expect personalized experiences everywhere they go, and stores are no exception. As technology improves and stores leverage their historical data to better understand their customers, they will improve their loyalty programs, promotions, and inventory to curate better experiences.

With shopper insights technology, retailers are even able to push coupons to specific customers as they enter the store. Programs like this will become more common as retailers realize how compelling personalization can be to consumers.

The industry’s march toward more flexible, streamlined, and efficient operations has been underway for some time. However, the progress retailers have made in the past few years has been remarkable. At Sensormatic Solutions, we are firm believers that progress begets more progress. If the past year is any indication, 2023 is shaping up to be a year filled with innovation to elevate in-store shopping experiences. Retailers can feel confident that Sensormatic Solutions will be right there with them, developing the tools that will fast forward retail.

To learn more about how Sensormatic Solutions digital offerings are leading the future of retail, visit booth #6305 at the 2023 NRF Retail's Big Show, January 14-17 at the Jacob K. Javits Convention Center and follow #SensormaticNRF2023 on Twitter and LinkedIn. To request a booth tour or a meeting with your account manager, visit our scheduling page.