10+ Critical Buying Trends To Watch in 2024

Dig into the data and explore 2023 consumer trends to help guide your marketing strategy, meet customer expectations, and future-proof your business.

In June 2020, over half of North American buyers surveyed by Shopify said the COVID-19 pandemic had changed the way they will shop going forward. Looking back now, how did this play out?

The answer is that the shift has been more pronounced than anyone could have predicted. As supply chains still struggle to recover and inflation is reining in household spending, small businesses have been hit hard. 

While inflation is predicted to slow in 2023, small businesses will need to contend with shifting consumer demands and loyalty in the wake of rising costs. What new shopping behaviors have emerged? Which consumer trends will impact brands the most? And how can business owners respond? 

Ahead, dig in to the data and explore expert predictions to help guide your marketing strategy, meet customer expectations, and future-proof your business. Plus, get a generation-by-generation breakdown of the top trends by demographic.

11 consumer trends to watch in 2023

1. Buyers impacted by inflation are seeking deals
2. Social ads still big driver of purchase decisions
3. Brand loyalty is waning
4. Brand collaborations cut acquisition costs
5. Social commerce and discovery hold strong on TikTok
6. Customers demand low-friction returns
7. Brands look to omnichannel experiences to reach more customers
8. Building relationships starts local
9. Supply chain issues persist, despite customer expectation
10. Personalization is in demand
11. Buy now, pay later options popular with younger shoppers

1. Buyers impacted by inflation are seeking deals

While the luxury products market is predicted to see an uptick this year, mid-tier or “aspirational luxury” brands will struggle most to offer value to customers without damaging their reputation. Tightening spending has caused brand loyalty to wane, with consumers looking for deals. Shopping habits are trending toward saving money and price comparison.

📊 What the research shows:

• Eight in 10 Americans surveyed in one poll believe 2023 will be a year of economic difficulty
• 56% of households plan to save money this year by reducing expenses

How small businesses can respond

Offering discounts or other financial incentives to attract price-conscious consumers is one approach—but it may not work for every brand. This can cut into already narrower margins for businesses faced with rising costs. Some business owners may even avoid sales, as this has a negative impact on a brand’s image. Bundling products, adding a subscription option, and offering gift cards with a minimum purchase can all help increase conversion.

2. Social ads still big driver of purchase decisions

Despite the rising cost of acquiring a customer and the lower return on ad spend (ROAS), social ads are still a top driver of purchases in the US, research finds. On some platforms, social commerce hasn’t seen uptake at quite the rate expected, causing companies to revert to a “back to basics” approach to advertising.

📊 What the research shows:

• 78% of consumers say they are more willing to buy from a brand if they have a good experience on social.
• Social media ad spend increased more than 38% between 2020 and 2021, rising to almost $230 billion in 2022. 
• While the cost per thousand ad impressions (CPMs) increased during this time, it began to fall in the second half of 2022.

How small businesses can respond

Before investing in social media advertising, understand where your ad dollars will be best spent. Choosing the platform where the majority of your target audience hangs out or the channel where you’ve already found success with organic marketing is the best first step. Start small and test, test, test!

3. Brand loyalty is waning

Several factors can push your customers to buy from your competitors. Competition is increasing while spending power is predicted to decrease, inspiring consumers to be more critical of where they’re putting their dollars. 

Price, though, isn’t the only reason for waning loyalty. Consumer habits are aligning more and more with their values, pushing many to opt for brands with sustainable business practices. Customers are also seeking convenient, responsive, and personalized shopping experiences—and they’re willing to look elsewhere to find them. 

📊 What the research shows:

• More than 70% of consumers bought from the competitor of their go-to brand between May 2021 and May 2022.
• 46% of consumers will move to a competitor if their usual brand is out of stock.
• More than 70% of consumers surveyed say they like the convenience of instantly purchasing products while browsing on social media.

How small businesses can respond

Retaining existing customers is still less costly than acquiring new ones, meaning investing in loyalty is key. Reward loyal customers with exclusive discounts and perks. Reevaluate your inventory management strategies to avoid losing customers to out-of-stock products. Finally, appeal to the social and emotional interest of younger consumers by implementing a sustainability strategy and communicating environmental impact.

4. Brand collaborations cut acquisition costs

Changing social algorithms, high ROAS, and stricter privacy laws governing third-party data mean achieving reach is more challenging, so brands are turning to collaborations to fill the gap. Customer interest in your brand can only improve with endorsement from a trusted company or online personality.

📊 What the research reveals:

• Nearly one-third of consumers say influencer recommendations are more impactful than those from friends or family.
• User-generated content is 8.7 times more impactful than influencer content.

How small businesses can respond

Businesses can use collaborations with other complementary brands, influencers, and creators to access audiences that mirror their target customer. Brand-to-brand collabs can involve co-creating a product, experience, contest, event, or campaign. Collabs with influencers and creators are usually paid endorsements but can sometimes also involve a co-created product or experience. And don’t forget to engage with influential, loyal followers for authentic testimonials.

5. Social commerce and discovery hold strong on TikTok 

One platform is dominating the social commerce space: TikTok. TikTok reported in 2022 that its platform is 1.7 times more likely to be the source for product discovery than other platforms. The social network also became shoppable last year, monetizing the popular #TikTokMadeMeBuyIt trend. 

📊 What the research shows:

• The percentage of TikTok users who are social buyers is predicted to surpass Facebook’s in 2024.
• Google found that 40% of internet users aged 18 to 24 start an internet search on TikTok or Instagram—rather than using Google.

How small businesses can respond

TikTok can be a lucrative secondary sales channel for ecommerce businesses looking to target younger millennials, Gen Z, and the newest Gen Alpha cohort to age into the platform. Creators can also monetize audiences by selling through TikTok and a Shopify Starter Plan, without having to build a website from scratch. As more and more young people are shopping via mobile devices, invest in vertical video content for TikTok, Instagram Reels, and YouTube Shorts.

6. Customers demand low-friction returns

While free returns have been a staple service offered by large chain retailers for years, many like Zara and H&M are returning to charging shipping fees. But customers, accustomed to the trend of no-hassle returns while online shopping, continue to demand it. How can brands offer a frictionless return policy that doesn’t cut into their bottom line?

📊 What the research shows:

Top returns frustrations reported by consumers:

• Having to pay for return shipping (41%)
• Paying a restocking fee (36%)
• High fees associated with the return shipping (31%)

How small businesses can respond

With margins tightening, offering free returns may be out of the question for some small businesses. That doesn’t mean you can’t find creative ways to make the returns process less painful. Combat returns before they happen by improving size charts, photographing clothing on a variety of models, offering a personal shopping assistant service, or using a virtual try-on app. Another option is to try a returns portal app that creates a smooth and self-directed returns experience. 

7. Brands look to omnichannel experiences to reach more customers

With supply chain issues, waning loyalty, and more competition, direct-to-consumer (DTC) ecommerce brands are seeking new ways to reach their customers. Consumers are starting their discovery journeys in places other than traditional search engines. Finding new avenues to get in front of buyers will be key in 2023.

📊 What the research reveals:

• Amazon tops the list for online shopping searches among US adults, with 63% reporting they use the site to discover products.

Insider Intelligence

How small businesses can respond

Taking an omnichannel approach can help brands expand reach in an increasingly noisy space. Alongside your ecommerce store, surface your products on other channels like Amazon, via online marketplaces, through social selling, and in physical stores. 

8. Building relationships starts local

Consumers are returning to in-store shopping, which is great news for local businesses with a retail presence. But even these businesses need to step up their game, putting more emphasis on creating value for their customers through brand experience. DTC brands are even getting in on the action, with many adding physical touchpoints to the customer experience. 

📊 What the research shows:

• Half of Gen Z shoppers favor in-store shopping, despite being online-native. 
• More than a third of shoppers say they prefer to shop in store for the experience. 

How small businesses can respond

Whether or not your brand has the means to have a retail presence, brand experience is increasingly important to customers. Don’t just sell products. Sell them your brand story, offer them value beyond their purchase, and engage directly on community channels. Alternatives to a full brick-and-mortar experience include launching a pop-up shop, wholesaling to other retailers, and participating in local markets. 

9. Supply chain issues persist, despite customer expectation 

Sixty-six percent of global brands surveyed by Shopify expect supply chain issues to get even worse in 2023. But impatient consumers aren’t waiting for these issues to resolve.

📊 What the research shows:

• One survey found that, in reaction to supply chain disruptions, 29% of customers have changed the retail store they usually shop in, and 40% say they use comparison sites for online shopping.
• Companies that use AI-enabled supply chain management have shown an improvement of 15% in logistics costs, 35% in inventory levels, and 65% in service levels.

How small businesses can respond

The Shopify Commerce Trends 2023 report offers this advice to businesses looking to future-proof logistics networks:

1. Hold more inventory to avoid going out of stock.
2. Find additional vendors and suppliers to diversify product sources.
3. Shrink return rates by helping customers make more informed purchases.
4. Digitize supply chains by using apps and AI to automate and streamline processes.

10. Personalization is in demand

Many consumers expect brands to offer personalized shopping experiences, both in-store and online. But consumer interest in shopping experiences tailored to their interests is matched by their concern for privacy. 

📊 What the research reveals:

• Interest in personalization is increasing drastically. In 2022, 62% of consumers surveyed in one study said a brand would lose their loyalty if it did not deliver a personalized experience, up from 45% the previous year.
• One study found that 74% of consumers surveyed said they highly value their data privacy and 82% are concerned about how companies are using their personal data.

Twilio

How small businesses can respond

Take a balanced approach to using personal data to create experiences for your customers. Reduce reliance on third-party data solutions and move to collecting data directly, be transparent about how you will use this data to maintain trust with customers, and stay compliant with privacy laws.

You can personalize the customer experience using AI to make product recommendations based on your customer’s activity. Try quizzes or chatbot personal shopping assistants, and send tailored marketing messages specific to their buying habits and preferences.

11. Buy now, pay later options popular with younger shoppers

Fight inflation woes by offering customers a buy now, pay later (BNPL) option. The popularity of this payment method, especially among younger shoppers, continues to increase as consumers watch their spending. 

📊 What the research shows:

• The BNPL market was valued at $141.8 billion in 2021 and is expected to grow more than 33.3% between 2021 and 2026.
• Nearly half of millennial and Gen Z shoppers planned to use BNPL during the 2022 holiday season. 

How small businesses can respond

Enable Shop Pay Installments in your online store to easily offer a BNPL option for your customers. This gives them flexibility to make a purchase within their budgets through interest-free payments over time—removing a potential barrier to making a sale.

Consumer trends by generation

While many of the above trends are consistent among all consumers, businesses should understand the needs of their particular target customer. Ahead are notable trends emerging by generation.

Boomer trends

Brands targeting a Boomer audience shouldn’t discount more traditional advertising channels. Sixty-two percent of this group reported that they discover products most often through cable television ads. 

In product trends, Pinterest search data shows that interest is up for party supplies among this generation. Those in their “YOLO years” are celebrating birthdays and golden anniversaries in a big way.

Gen X trends

Trust, loyalty, and personal experiences are key to winning the dollars of this demographic. One study found that 82% of Gen X will purchase a product at full price if they want it. In-store shopping is also preferred by this group, with 73% saying they purchase products this way.

Millennial trends

Converting this generation means more than just offering a great product. Millennials are increasingly voting with their dollars, and 41% say they prefer to support brands that offer sustainable products or take a stance on social issues. 

A quarter of parents in the US are millennials. When catering products and marketing messages to this group, it’s important to understand their priorities. Pinterest predicts a focus on “the fourth trimester” as young parents are prioritizing self-care and mental health, post childbirth. Millennial moms report using personal networks and communities to inform purchase decisions. 

Gen Z trends

Sustainability is so important to this demographic that 75% say it’s more influential than brand name. Gen Z also have unique social media habits, with over half planning to get fashion and beauty inspiration from digital influencers and avatars. Appetite for AI doesn’t stop there, though—85% say they prefer chatbots and automated customer service over speaking to a live agent.

Gen Alpha trends

The oldest of this generation are now teens and are a demographic of future consumers that brands shouldn’t ignore. But even before these kids have their own disposable income, they already wield significant influence over household spending. Appeal to Gen Alpha through transparent, meaningful, and authentic messaging, say experts.

Adapting to consumer demands in 2023

Many small businesses are still reeling from the impacts of the past few years. Those that survived did so by adapting business models and increasing options for their customers. As consumer trends shift again, brands should keep the feedback loop open, diversify their supply chains, and explore new sales channels to cater to customer expectations while protecting their bottom line.

Research support by Jane Zhang
Photography by Pexels
Feature image by Cornelia Li

Consumer trends FAQ

What are consumer trends?

Consumer trends are patterns of shopping habits that change over time. They are generally determined by experts based on data, consumer behavior surveys, and studies that examine how people spend money and make purchasing decisions.

What are examples of consumer trends?

1. TikTok for product discovery and shopping among younger consumers
2. Expanded use of payment options like digital wallets and buy now, pay later
3. Brand loyalty shifting due to more choice and value shopping
4. Consumers choosing eco-friendly products or brands that take a stand on environmental issues
5. A return to shopping in physical stores

What do consumers want in 2023?

Consumer behavior is shifting toward making more careful purchase decisions as inflation puts a strain on budgets. Buyers are seeking better value while also looking for positive brand experiences, making sustainable choices, and seeking flexible purchasing options.