On March 17-20 THG Commerce joined the top brands and retailers at Shoptalk US 2024. Renowned for bringing together industry leaders under the Las Vegas lights, this year’s event did not disappoint.  

We even brought our own unique flair to the event by inviting our partners, Williams Racing (with whom we recently announced a fulfillment partnership to power the brand’s 2024 merchandise collection), to join us in giving delegates the opportunity to see an F1 car up close.

But not all that happens in Vegas needs to stay in Vegas. So, from the importance of charming Gen Z consumers to the role social commerce has to play in brands’ futures, here are some of the key takeaways from this year’s talks and discussions. 

The consumer’s financial landscape of 2024

Brands are nothing without an audience willing and wanting to purchase from them.

As it stands for 2024, despite entering an era of tentative income growth (60% of households are seeing an increase in income from 2022 according to Kelsey Robinson, Senior Partner at McKinsey, in a session on ‘Understanding the Changing Consumer’), consumer confidence still trails below pre-Covid levels.  

According to McKinsey in their exploration of the changing consumer, low-income consumers continue to be cautious buyers despite outspending their income, while higher income optimism is on the rise.

At the same time, consumers are veering away from the ‘or’ approach to shopping decision.

This mindset has previously seen them make purchasing compromises and are increasingly embracing a ‘treat yourself’ culture. Gen Z consumers, in particular, are spending on ‘want’ over ‘need’ products as they enter the buying community.  

So, where does this leave brands? With a multitude of nuances in consumers’ financial circumstances and attitudes, many are focusing on what makes Gen Z tick in preparation for the generation set to outstrip millennials’ buying power by 2030.  

Gen Z seek value beyond the price tag

The ability to connect with Gen Z and capture their attention as shoppers can make or break a brand. The resurgence of Crocs in the last two years is proof of that, with CMO Heidi Hooley vouching for the age group's importance in the near-four-billion-dollar revenue increase in 2023.

Combining an awareness of consumers’ need for work-from-home footwear with Gen Z’s intrinsic desire to express individuality, Crocs have re-entered the world of fashion through personalization capabilities and limited-edition partnerships that make their product more than just footwear.  

What this demonstrates is the need for brands to build and showcase value that goes beyond the price tag of a product – a testament that was shared by CEO of fashion brand PacSun, Brieane Olson.  

Beyond partnerships and limited-edition products, value can be shown in other ways. For example, Gen Z seek convenience, be this through subscriptions – which, according to McKinsey, remain an opportunity for brands despite 60% cutting one subscription in the last six months – or through the speed and delivery options afforded by order fulfillment.  

So, how can brands build the strategies and operational capabilities that will bring value to a previously transactional purchasing experience?

Building an omnichannel presence to meet consumers where they are

Creating a convenient buying experience means meeting your consumers where they are and where they expect you to be. This is where an omnichannel approach comes into play for brands.  

However, in a discussion on improving efficiency and profitability, Brooklinen CEO and Managing Director at BMO Capital Markets agreed that simply having a physical store in a digital era wasn’t enough – brands need to make visiting a brick-and-mortar store worth the customer’s time.  

The in-store experience increasingly needs to be just that – an experience. And whilst brands are still experimenting what that specifically means for them, be it through exclusive events, pop-up stores or celebrity appearances, striking the strategic balance between digital and brick-and-mortar was a key talking point at Shoptalk 2024.  

Indeed, whilst Brooklinen CEO concurred direct-to-consumer “should be far more profitable”, to create a holistic strategy an omnichannel approach is pivotal to broader go-to-market success, including stores.

Leveraging social commerce to drive value and presence

If an omnichannel approach is critical to unlocking the maximum number of brand-consumer touchpoints, social commerce is the key to conversion – particularly when it comes to Gen Z.  

Though, according to McKinsey, consumers are using three or more channels to shop, social commerce is where significant opportunity lies. Across this year’s event there were proof points to this in every direction, including:  

• 80% of Gen Z are buying from online creators after engaging with their content. 
• Gen Z are twice as likely to buy within a day of seeing an ad.  
• 24% of consumers have made retail purchases on Instagram. 
• 70% of TikTok users discover new brands and products on the platform.

Getting even more granular, TikTok is the single biggest source of social commerce buyers, with 40% of users making at least one purchase on the platform, ahead of Facebook and Instagram.  

In a discussion that brought together experts from Meta, American Eagle and Coach, it was concluded that if TikTok’s continued popularity and performance has told us anything, it’s that brands should no longer think of themselves as just retailers - they are now also in the entertainment industry.

Yet, the value of social commerce isn’t only in the conversion to checkout. Across multiple panel discussions, the value of user-generated content (UGC) was a key theme. More than just directly generating revenue, social platforms offer businesses the opportunity to continue exploring what it means for consumers to experience their brand through storytelling.

With social UGC in particular, brands create an opportunity for consumers to be directly involved in a brand’s story.

The result: an emotional tether between brand and consumer that has the potential to branch across networks and appear in the 3.5 billion reels shared each day.

Together, this builds brand awareness and develops a community of existing customers, brand advocates and future shoppers.

Nurturing brand communities and loyalty to drive growth and innovation

Beyond the traditional transactional relationship between brand and consumer, community building is increasingly key to building brand awareness, loyalty and product innovation.

In a discussion between Beis Luggage CEO and Coty, the dynamic between brand and consumer was depicted as a cycle, fed by data-based knowledge, transparency and a wish to keep consumers involved in the brand itself.

By knowing how and where their consumers initially engage with them (and ensuring they are present in this space), brands can leverage storytelling to engage the user through educational and authentic content.

This engagement in addition to data gathered across purchase-driving channels can help a brand form a picture of what consumers want and like. This can then be used to inform new product development and innovation that continues to meet consumers’ wants and expectation.

This form of data-based innovation is nothing new to the world of ecommerce. but brands should ask themselves: are they communicating to their consumers just how much they are influencing the products they buy?

In a competition-filled era where brand loyalty is critical to long-term success, what better way to influence consumers’ emotional investment than showcasing the active part they play in innovation, writing them directly into your brand’s narrative.

Experience performance with THG Commerce

THG Ingenuity is the complete commerce solutions provider trusted by leading brands like Speedo, L'Occitane, and Klean Athlete to support growth ambitions and experience performance.

Built to enhance your consumer’s purchasing experience with a flexible, comprehensive solution spanning technology, marketing and fulfillment, we deliver simplified and more valuable commerce for brands and consumers alike.  

Want to find out how THG Commerce can support your ecommerce ambitions? Reach out to our experts today.