Consumer trends for 2021

Consumer trends for 2021

With many shops across Europe closed down for much of the year, tiered government restrictions and nationwide lockdowns in an attempt to slow the spread of COVID, we have all become even more familiar with the various benefits and frustrations of shopping online. Although it has been at the expense of our High Streets, the e-commerce sector has been booming. How will this impact the future as stores open their doors? Will they win back their customers or are most of us now committed to virtual shopping?

In this article, you will discover the answers to:

What are the latest e-commerce trends through to 2021 and beyond?
How are real bricks and mortar retail outlets winning back their customers?
What does it all mean to the consumer?
The impact of COVID-19 on retail sales

Perhaps surprisingly, overall, the COVID-19 pandemic has made little impact on retail sales. In fact, the sales volume across Europe is a little ahead (102.7%) of that for the same period pre-COVID.

European consumers spend about 31% of total household expenditure on retail. Few of us will forget the empty shelves inside and the long queues outside supermarkets during the early days of lockdown. Food retail boomed while other retailers struggled. In the UK, Primark saw monthly sales fall from £650 million to zero though Internet sales for food and many non-food retailers boomed. Tesco doubled home deliveries in a single month. Similar patterns emerged across Europe.

Although we now begin to see the rollout of coronavirus vaccines, the crisis is far from over. Store closures are rife as are concomitant job losses. Perhaps we were heading that way anyway as ever more large retailers were failing to see reasonable returns from expensive retail outlets in city centres. Perhaps the pandemic has merely accelerated what some people predict will be “the death of the high street.”

Another nail in the high street’s coffin is the boom in internet sales. Before the epidemic, European internet sales were around 15% of total retail sales, and by July this figure had increased by 30% though it is now declining.

Will the high street recover?

The collapse of Debenhams will leave a gaping hole in the High Street, as also will Arcadia’s failure which threatens 400 stores and 13,000 jobs. Many other stores have also disappeared; Gap, THE US-owned retail chain is considering closing all of its 128 stores across Europe. UK High Streets are strewn with a staggering 44,000 empty retail units. According to the FT, this is likely to double over the next few years. European shopping centres are experiencing similar pressures. Footfall in Germany’s high streets fell by 50%, and more than half of US department stores are expected to close down during 2021.

Given the excessive retail floor space, the current trend is for the retail landlords to reduce rents. Combining this with reducing floor space, rental incomes are set to fall by over 50%.

Repurposing retail spaces

An inevitable trend is the repurposing of vacant retail spaces. We are likely to see progressively more large shopping centres being converted to multi-use spaces incorporating residential, retail, workplaces, eating and leisure. Currently, the UK government is looking at bids from 100 local authorities to move town centres away from retail. Similar developments are taking place in the EU and US.


The pandemic has made an enormous impact on eCommerce globally. As we have indicated, by the end of July 2020 internet sales rose from a baseline of 20% to a peak of 35%. In the UK, 74% of people are comfortable shopping online while in the US, 62% of consumers have increased their e-commerce spending. In terms of non-essential items, the leading ongoing purchasing trends are:

Digital entertainment
Home improvements
Books, games, toys etc.
Future travel
While these trends are likely to change as we come out of the epidemic, with many consumers reverting to shopping in-store, people are likely to continue to shop online to a much greater extent than pre-epidemic.

e-Commerce technology trends

e-Commerce technologies will continue to develop through 2021. Some of the top technology trends for 2021 include:

The increased use of machine learning in digital marketing

For sometime online marketers have been leveraging artificial intelligence (AI) and machine learning (ML) to streamline each functional aspect of marketing and the consumer journey, a trend that will continue into the foreseeable future. New cognitive systems will gather data on customer behaviour and interactions which they will use to predict future behaviours providing individuals with hyper-individualised messages and calls for action. Marketing will become “smarter, faster and more relevant.” We will see ever-increasing computing power channelled to this purpose. For instance, the IBM Watson supercomputer already focusses on achieving marketing goals.

Other areas where AI and ML have a significant impact are search engine optimisation (SEO), paid search, and marketing analytics.


Another AI-driven trend is the increasing use of chatbots. A current example of this is Vodaphone’s “TOBi”, a chatbot that provides website visitors with personalised recommendations. Vodafone claims that it achieves a 100% conversion rate and provides an 80% resolution rate to customer questions and requests. Another example is LEGO’s “Ralph”, a Facebook chatbot. His conversion rate is over eight times that of conventional Facebook Ads and helped reduce conversion costs to LEGO by 31%. Marketing chatbots will be a growing trend through 2021 and beyond.

Augmented and virtual reality

The e-commerce sector is already applying the potential of augmented reality (AR) and virtual reality (VR) to improving customers’ shopping experiences, and new developments are set to redefine how we shop online. Technologies that enable customers to try on cosmetics virtually, view furniture and décor in the setting of their own home, or take a car for a virtual test drive, are just a few areas where VR is making online shopping more engaging and giving potential customers the confidence to buy now.

Last words

The world of retail, both online and in shopping centres across Europe and the US, is being redefined. The overriding trend is to focus on consumer experience rather than sales. Intelligent technologies encompassing AI, VR, chatbots, and more are driving the e-commerce markets. Even though shopping centres face multiple challenges, reports of their imminent death are exaggerated. We will see new innovations and repurposing of shopping space, but people love to shop for real as well as online – a trend that is unlikely to go away.

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