The temperature outside is starting to drop and the winter holiday displays are popping up earlier and earlier as retailers prepare to offer deals and move merchandise. It’s also the time of year when our customers get ready for the peak holiday season. We’d like to take a step back and look for possible patterns and trends for next year – we call it “prediction season”.
As pioneers in search and discovery innovation and passionate technology partners to eCommerce players, we at Algolia know it is our duty to look at our crystal ball for 2023 and beyond. So, without further ado, here are ten predictions we foresee as the future of search, discovery, and the retail industry:
- M&A Momentum: Mergers and acquisitions have been fairly quiet this year compared to pre-pandemic levels, as investors have been cautious and focused on preserving funds. We anticipate that activity will increase. Evidence? Our latest acquisition of Search.io…an M&A move that helped us create the world’s first and only hybrid search engine combining Keyword and Vector Search in a single API.
- Pushing Back On Inflation: High prices from goods to gas have pushed consumers to the brink as they continually re-evaluate their spending budgets. Consumers don’t want to cut back on buying (especially with the holiday season rapidly approaching), so they’ll lean on credit to get them through any tough times.
- Off-Brands Take Off: Speaking of inflation, we’re seeing an opportunity for retailers to focus on their generic branded products, like household goods, apparel, and grocery items that provide great value at inflation-friendly prices compared to the name brands.
- Focusing on Search Maturity: You can’t have a good search experience if you don’t have the data to provide relevant results. Brands and retailers have become more aware of this gap in their search and discovery and are working to collect and refine the appropriate information to provide better customer experiences to squeeze all possible conversion they can..
- The Machine Learning Takeover: Machine learning will take over how retailers manage their inventory automatically, by matching real-time data to supply and drive better decision making. Brands will lean on more automated processes as headcount costs have increased and put pressure on margins.
- Hybrid Search Will Reign: In order to take the customer experience to the next level, predicting intent and contextual meaning is the key to keeping consumers engaged and adding items to their carts – enter hybrid search. It’s no longer enough to bring them to pages with items that vaguely resemble their search query, retailers need to constantly refine their search capabilities to deliver exactly what the customer wants, plus what they may want to pair with their original purchase – even when they are having a hard time describing what they need.
- Rise of Hybrid Shopping: Consumers want what they want NOW, so out-of-stocks online or in-store will not stop them from getting what they need today. Try online, pick-up in store is gaining momentum and is likely to cause chaos during the busiest shopping season of the year. If consumers are not able to buy what they want online, they’ll rush to the stores to find it instead, making it imperative that retailers perfect their omnichannel strategies.
- Visual Search Picks Up Speed: As of August 2022, 30% of US adults had used visual search for shopping. Visual search uses real-life imagery via AI to guide a user’s search query, rather than text. Smartphones and social media platforms like Pinterest are picking up this tactic to get users shopping – simply snap a picture or tap a photo you see in your feed, and you’ll be redirected to a website that has that item for sale.
- Live Shopping Isn’t Dead: Despite recent moves by Meta and Instagram to cease their plans for live shopping in the US, social commerce is still an asset for retailers – especially Tik Tok.
- Voice Search is a Discovery Asset: “Alexa, please add shampoo to my shopping list.” What an opportunity to provide the customer with ample choices on what kind of shampoo they should buy. If a brand is optimized for voice search, it should be able to get its shampoo product to the top of the list for the customer’s consideration. Discovery-based queries are an important opportunity for brand awareness and cart conversions.
The future is bright and exciting for search and discovery, with new capabilities being built every day. Over the last several years, search and discovery has moved closer to the top of the priorities list for businesses hoping to reach new customers and engage current ones. 2022 has been a revolutionary year for search, and we’ll only continue our way up with the mission of making the way we search for information, products, and entertainment better.
Want to learn more about how search & discovery can benefit your organization? Meet with some amazing Algolia experts for a live demo.