2022 Retail Trends in the UK

It’s no surprise that the retail industry is facing change as a result of the pandemic, encouraging a quick response from store owners as they balance shifting customer needs with the drive for personal connection. But many business owners have been prepared for a shift in the UK shopping experience for some time.

Square surveyed over 500 retailers and 1,000 consumers to identify how the retail industry has evolved since 2020. These industry insights give us a summary of the top retail trends of 2022.

Read on as we break down retail patterns and advice for 2022. You can also check out the full report.

  1. An online offering is crucial
  2. Connecting the online and offline worlds
  3. Next generation selling could change how we shop
  4. Social media commerce is on the rise
  5. Improved efficiency with inventory management technology
  6. Consumers want to see continuing community support
  7. COVID safety measures are here to stay

An online offering is crucial

As many as 97% of consumers now make monthly retail purchases online, with 53% of avid online shoppers falling between the ages of 25 and 44. It goes without saying that an online presence is vital for most businesses.

To meet this trend, 87% of retail owners and managers surveyed are now selling products online. Retailers have persevered through recent challenges by expanding to online retail to stay afloat and offer more to customers.

What’s more, over half of those surveyed consider it likely they will become an online-only store in the next year.

Having the flexibility to adapt to customer needs is said to be one of the key reasons why independent businesses have an advantage on larger competition. Whether it’s quickly introducing buy now pay later (BNPL) to drive sales or automating customer feedback to build loyalty, the ability to curate their shopping experience to current trends is something of a secret weapon, since they can redefine the consumer experience.

Square for Retail

A suite of tools made just for retailers

To keep up with demand, insights also show the importance of an effective omnichannel strategy, as well as leaning into new challenges. A commitment to selling online and having an online presence triggers the need to run your business operations digitally.

Online eCommerce software such as Square Online can help – offering tools to track inventory and simplify payments, all in one place.

Connecting the online and offline worlds

Businesses have suffered a loss of foot-traffic during the pandemic, so when it comes to access, it’s become important to connect the online and offline worlds. Appealing to wider audiences by setting up an online store and offering home delivery were significant steps during the days of empty shelves and streets.

Nonetheless, the nation’s energy for brick-and-mortar businesses hasn’t changed. There remains value in the culture of the high street shopping experience that 50% of shoppers have missed – particularly when it comes to window shopping and in-store browsing.

Customers appreciate the tangibility of assessing products, with 34% saying they miss trying out and experiencing products in person before buying.

Merging online and offline territories can increase business opportunities and create better connections with customers at the point of sale. It makes good business sense to implement a hybrid strategy, allowing for increased sales, repeat customers and ultimately – more access to the products they know and love.

Retailers also changed to meet demand by integrating home delivery and same day in-store pick up, appealing to the 43% of customers who miss the convenience of having what they purchase immediately, competing against larger retailers.

Some 50% of UK shops now offer same day collection, while 26% offer same-day delivery – addressing the needs of customers without diminishing the importance of brick-and-mortar offering. The modification of speedy delivery options can also increase sales, giving customers incentive to fill and complete online checkout baskets.

The online frontier is not a replacement, but rather an enhancement of the community retail shops we love. Hybridising the two worlds can benefit small business owners with the use of Square Reader – providing the confidence of a professional payment system on the go.

Next generation selling could change how we shop

From what we’ve seen over the last year, the shape of the UK shopping experience as we know it is likely to change.

David Rusenko, Head of eCommerce at Square, says retailers are adopting QVC-style demonstrations of products on TikTok and social media. The likes of packaging and unboxing videos create a sense of intimacy between retailers and customers, offering an inside look at what they’re buying. As many as 27% of retailers plan to introduce livestream experiences, and 26% of consumers are interested to see it.

On the flipside, flash sales on Instagram can encourage a sense of urgency, creating an exclusive opportunity that customers may only know about if they follow their favourite retailer’s social channels.

Some 67% of consumers are willing to try new ways of shopping. Our industry experts suggest that trends may transform radically in the next year with the growing success of livestream selling, while VR shopping could bridge the gap between high street window shopping and online browsing:

30% of retailers plan to introduce virtual reality shopping, with 35% of consumers interested to see it

35% of retailers plan to introduce window shopping with QR codes, with 30% of consumers interested to see it

If there’s a market, these next-generation changes could increase foot-traffic for businesses – however virtual that may be.

Social media commerce is on the rise

Following on from the latest retail trends, commerce is seeing an influx of social media influence, changing the way we purchase online.

Competition in the retail industry is pushing retailers to innovate via social media, adapting their online presence and extending their shopping experience to platforms such as Instagram and Facebook. Indeed, 73% of UK consumers have recently bought products directly from social media, indicating a strong connection between brands and their communities online.

As such 53% of independent retailers are already selling their products via social media platforms. A further __32% of retailers have plans to use social media platforms in the next year, while 52% of retailers expect technology to improve consumer shopping experience over the next year.

Fostering an online following may not only encourage new customers to discover your product, but 31% of retailers also expect social media to improve customer engagement and loyalty. Some retailers are beginning to offer ticketed livestream events on social media, encouraging a sense of excitement and engagement over a product reminiscent of pre-pandemic times.

Square Online can help retailers sell online and integrate social media, by linking your Instagram feed and creating targeted Facebook ads. Why not turn your Insta feed into a one-stop shopping platform?

Improved efficiency with inventory management technology

As trends move towards adopting various streams of service and integrating online and offline worlds, retailers are taking interest in inventory management technology – investing in streamlining their business for the better.

Some 71% of UK retailers are looking into inventory technology to improve efficiency, while 36% already use it to show real-time inventory. This might be a solution if you feel as though you’re spreading yourself thin trying to balance an online store alongside an in-person point of sale. It can also improve supply chain efficiency while organising operations at the same time.

Digitising your business can make it easier to evolve and expand your inventory to meet consumer demand. Indeed, 41% of retailers plan to invest in this technology over the next year, while 44% expect it to improve stocktaking and inventory management as a whole.

Our experts suggest that real-time inventory software can make an omnichannel selling strategy achievable for retailers of all shapes and sizes. Effective inventory management can also highlight where you can improve as a business.

Conveniently synchronise your online and in-store inventory with the help of inventory management software like Square Online.

Consumers want to see continuing community support

Although widening your net as a business and increasing online presence has proven important, customers also value genuine community engagement and look to see ongoing support from retailers. A quarter of retailers surveyed started doing business with local companies in the last year, a trend that 37% of consumers would like to see continue.

Throughout various lockdowns and ongoing travel restrictions, our experts found that independent retailers met the challenge of supply chain disruption with consumer engagement. By nurturing community connection and listening to the local market, retailers can fulfil demand by adapting to local demand and stock requests.

Other insights show us that 43% of consumers want to see businesses donate food or supplies to local community organisations and charities, with 95% of retailers planning to continue these community engagement initiatives.

What’s more, 32% of retailers surveyed started engaging with sustainability and waste management efforts over the last year.

Community support and concern for waste appears to be ongoing as retailers listen to what consumers want to see, showing customer engagement is just as important offline as it is online.

Manage and update new stock easily with the help of Square for Retail, helping you run your retail business at the point of sale.

COVID safety measures are here to stay

Trends show that as we return to indoor shopping, the safety measures we’ve put in place are backed by the support of customers. In fact, 88% of UK consumers consider the safety measures imposed during the pandemic to be critical when shopping indoors. Alongside social distancing measures, this is particularly relevant for consumers between the ages of 18 and 44.

To reflect demand for these changes to stay, 95% of retail chains plan to keep safety measures of some kind, promoting ongoing consideration for public health.

For some, this might take the shape of cashless initiatives, with 62% of retailers surveyed introducing contactless payment to their stores. As restrictions begin to lift, combining online stores with contactless payments at the point of sale keeps retail accessible to those who may still feel uncomfortable about high contact areas and shopping in busy public places.

Square can help business owners stay ahead of the retail revolution and adapt to emerging trends, so you’re ready to deliver the best service and shopping experience for your customers – and boost growth. Explore cashless solutions on the go, from the compact Square Reader to the all-in-one Square Terminal card machine. Invest in long-term changes without the long-term commitment.
Find out more about UK retail trends in 2022 by reading our full report.

Contact sales

Contact our sales team to learn more about how Square could help your business.

How to Shift Your Brick-and-Mortar Business to eCommerce
Multichannel Retailing: How to Sell Your Products on Multiple Channels
How to Extend Your Brand Through Local Pickup and Delivery