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7 Consumer Loyalty Trends That Will Shape Retail In 2023

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By: Jenn McMillen |

Posted on January 26, 2023

By: Jenn McMillen

Consumer buying patterns in 2022 can help retailers predict how much their shoppers might spend in 2023 but keeping their loyalty will take certain key practices. As retailers seek to profit in 2023, they should consider these seven practices to generate greater customer lifetime value.

Let’s start 2023 with a retail homework assignment. List the top three reasons your customers are loyal to you. Convenience doesn’t count. I’ll wait.

Here’s the point: Retailers and brands tend to confuse customer habits with customer loyalty. In truth, in the customer’s mind, all it takes for an A-list store to become a B-list store is an attractive new competitor next door.

Just look at how rising prices have undermined customer loyalty. As of July 2022, 25% of consumers said they were spending less on the brands they usually buy, according to research by the marketing platform Blackhawk Research.

Many of these customers may have been loyal, but circumstances force hard choices. Retailers, it’s time to prove you’re worthy.

Retailers Face An Historic Test Of Customer Loyalty

Loyalty is lucrative, after all. Consumers spend an average of $132 a month with retailers that have earned their fandom, compared with just $71 a month among non-fans, Bain & Co. research shows. If people change where and what they buy due to location, convenience or faster delivery, then the retailer they had routinely visited lost their loyalty, or never had it.

How do retailers make loyal shoppers stick with them? First, look beyond the obvious. These practices are a good start for 2023.

Digital and physical shopping will be damn near frictionless.

There are plenty of retail apps, ordering kiosks and artificial technologies to streamline the in-store shopping experience. In 2023, retailers will be pressured to make these technologies more instant and effortless, so their customers reflexively turn to them. QR codes – on products and in-store signage – are an easy gateway. At the Amazon Style apparel store in California, customers scan QR tags on mannequins to “Shop this look.” They then can scan the items they want to buy and have them sent directly to the pickup counter so they don’t have to haul the goods through the store. In 2023, maybe fewer of these technologies will require an app or a membership.

But the human element will gain importance.

Helpful employees still matter very much to a lot of people. More than half of consumers have cited friendly and knowledgeable staff as the most important factor in creating a good experience at specialty stores, Retail Dive reports. The recent shortage of workers will likely underscore their value to consumers. So if a retailer can’t meet quantity, it should aim for quality, via employee happiness. In 2023, an especially on-point benefit will be mental wellness services – the retail industry has the highest rate of poor mental health, reports Mental Health America. Third-party resources, including the app HeadSpace and digital coaching on BetterUp, can help.

Inclusivity will become a loyalty maker.

The majority of consumers, particularly younger ones, are paying attention to whether companies recognize the race, ethnicity, LGBTQ status and other differences of their customers. A 2021 study by Deloitte concluded that 57% of consumers were more loyal to brands that committed to addressing social inequities, most likely influencing 18- to 25-year-olds. Good example: Savage X Fenty, a lingerie shop in Las Vegas, is adorned with displays that can make anyone, regardless of shape or identity, feel welcome. And its dressing rooms use augmented reality to scan and measure the customer’s body discreetly, for improved fit, according to WSL Strategic Retail, a consultant.

Opting in will outshine opting out.

Google’s plan to phase out third-party cookies, those online text files that track and share consumers’ online activity for marketers, has been pushed to the second half of 2024, according to TechCrunch. This delay gives retailers and brands more time to show how privacy-friendly they can be. Rather than require online visitors to opt out of data collection, online retail sites can invite them to opt in. For example, retailers can replace their “we use cookies” pop-ups with consent banners that explicitly ask for approval to collect data (with easy “reject all” buttons). This option is more popular among European companies such as Playstack, where privacy laws are more strict. U.S. retailers should catch up before they’re forced to ­– become the leaders, not the followers.

Shoppers will turn toward authentic pricing.

It’s not lost on consumers that while inflation peaked at 9.1% in June, a pantry staple like the price of eggs continued to go up, rising by 39.8% in September. And it’s not lost on 80% of them that some of these hikes are due to profit taking. In November, an analysis by the U.S. Subcommittee on Economic and Consumer Policy confirmed that “certain corporations excessively hiked prices far beyond what their costs necessitated, further driving inflation.” Companies that manage their prices to reflect the true cost of inflation will likely improve customer loyalty because they’re showing that they’re on the customers’ side and trying to help them maintain their own costs.

Brands that do TikTok well could zoom.

Nearly half of U.S. TikTok users in 2022 were between the ages of 18 and 34, according to Influencer Marketing Hub, and they helped make it the most profitable non-gaming app in the Apple App store. In 2023, TikTok spending is expected to grow substantially: Insider Intelligence reports the platform is projected to gain 9.6 million social buyers, adding up to 33.3 million people who make at least one purchase in a year. Retailers and brands that stream spots that are authentic and inclusive could make one-time buyers two-time buyers, or more.

And The Biggest Customer Loyalty Trend Of 2023?

Perhaps the most important feature that will make loyalty stay in 2023 is reflected in each of these previous trends: It’s being more thoughtful about each customer. Regardless of how well-targeted a promotion is; regardless of price points or location, a retailer’s efforts to engage the shopper will be perceived as self-serving if the customer feels like a target, not a person.

Genuine thoughtfulness generates trust, and trust generates reliance and stability. If a retailer isn’t confident it possesses these qualities in 2023, any trends it practices will come across as rote. If a retailer approaches each of these trends as an opportunity to show it’s paying attention to its customers on all levels, it will have a greater chance for loyalty success. Cheers to a prosperous 2023!

This article originally appeared in Forbes.

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I have been building and sharing expertise in the retail industry for 20+ years. My wheelhouse includes customer relationship management, shopper experience, retail marketing, loyalty programs and data analytics. My perspective is unique because I have both extensive retail/client and agency/consultant experience.

In 2015 I founded Incendio, a firm that builds and fixes marketing, consumer engagement, loyalty and CRM programs. Incendio is a trusted partner of some of the biggest brands in the U.S., including Chipotle, GNC, PetSmart, NASCAR and Godiva.

Before Incendio, I honed my retail expertise filling executive roles at GameStop, Michaels, Tuesday Morning, Jo-Ann Stores, AT&T and Blockbuster. I’m also an award-winning instructor at Southern Methodist University, where I’m helping train the next generation of business leaders.

I frequently speak at retail and marketing conferences around the world and have been quoted in global news outlets including Forbes, Barron’s, MSN, QSR and CPG Matters.