Omnichannel retail is a strategic focus as US online sales reached over $200B in 2021
Key takeaways
01
US online sales reached over $200B
Traditional brick-and-mortar retailers quickly shifted to adopt digital strategies as a growing proportion of consumer purchases occur online.
02
The acceleration of omnichannel
With the merging of virtual and physical worlds, plus uncertainty around the future of ads, companies redefined the extent of omnichannel practices with help from partnerships and acquisitions.
03
Commerce in demand
Notable Digitally Native Vertical Brands (DNVBs) went public in 2021, valued at over $11B in total. M&A activity, for both DNVB and e-commerce deals, was strong.
Omnichannel retail strategy
Omnichannel is forcing retailers to rethink their approach to remain competitive by coordinating an integrated, consistent and seamless shopping experience leveraging traditional models and new technology.
Omnichannel retail strategy has evolved to incorporate not only physical retail stores and a great online experience but also includes social media, fintech and payment facilitation, blockchain and beyond.
US sales show online shopping on the rise
US online sales in 2021 reached over $200B representing 18% of all retail sales. Online shopping spiked 36%. However, in-person shopping continues to be a significant revenue driver with more new stores opening for the first time in five years.
E-commerce investments spike
In 2021, investment in e-commerce startups spiked in comparison to prior years representing 33% investment share and 67%.
Technologies like Web 3 and the Metaverse use augmented reality (AR), virtual reality (VR), and blockchain, along with concepts from social media, to create spaces for rich user interaction emerge as exciting new opportunity landscapes.
Social media advertising
Google and Facebook dominate social ad spend. Advertising on social networks such as Pinterest and Instagram are on the rise. Advertising on TikTok, Snap Chat and non-traditional platforms offer an affordable alternative to the next-generation customers.
Improving the customer experience
Partnerships have proven crucial for many retailers to remain relevant amid rapid change. Partnerships connecting technology, and fintech with retail are shaping the way consumers interact with brands – both in person and online.
Partnerships like the one between Target and Pinterest are changing the way people shop. Users take a picture of an item with a smartphone, search on Pinterest and find similar one for sale on Target.com.
IPOs and M&A
Four VC-backed Digitally Native Vertical Brands companies went public in 2021 valued at over $11B in total. M&A activity, DNVB and e-commerce deals were even split.
An omnichannel-themed M&A strategy is emerging. Themes include building a brick-and-mortar presence with a technology-enabled UX and tapping into new markets by being where consumers live, work and play.
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