retail trends

The Most Overlooked and Overhyped Retail Trends of 2020

Retail pros speak their minds in our first audience trends survey.

· 13 min read

2020's dominant retail trends were probably not the ones retailers forecast. But they were the ones we got.

So let’s look back at ’em. In an October 2020 survey, 336 retail professionals from our audience voted on a set of 15 retail trends: first, to ID the three most overlooked trends, then the three most overhyped.

  • Overlooked = Like Juicy Couture tracksuits, these trends changed the zeitgeist but didn’t get the immediate recognition they deserved.
  • Overhyped = These trends grew faster than Charli D'Amelio's TikTok following, but retailers didn’t think they earned the attention they merited.

Why this approach? Any outlet could post a year-end sales data recap telling you loungewear and DIY deskscapes won 2020. We wanted to ask retail pros how they felt about last year’s biggest trends—and share the results.

But, fair warning: If you’re looking for a scientific analysis of retail executives’ decision making patterns, look elsewhere. This is more Readers’ Choice Awards than Critics’ Circle.

Francis Scialabba

We’re limiting our in-depth analysis to the top three overlooked trends. While there wasn’t a runaway winner here, the three front-runners paint a sharp portrait of last year’s dark horse retail trends.

The Home Edit

The largest cohort of voters thought the retail industry needed more HGTV. More than a quarter of respondents considered the surge in home decor and improvement retail one of 2020's most overlooked trends. That makes it number one in the unsung hero category.

Was it? The category had a much better year than anyone I know.Butfew anticipated that many shopaholics would spend three-quarters of the year at home and turn to home makeovers to cope. Nor did they expect shoppers to embrace digital purchases, after years of believing furniture was a “try before you buy” biz.

  • Industry eyes were trained on sector leaders Home Depot and Lowe’s, which were permitted to stay open when others had to shutter. Both reported some of their strongest sales on the back of DIY projects.
  • But smaller players benefitted too. Duncan Blair, VP marketing of DTC furniture brand Article, told Retail Brew the brand nearly doubled its 2019 order total in 2020.

Renovation szn is forever. “Growth for home products will slow in 2021, but the category will still see some uplift and will remain one of the retail winners,” Neil Saunders, managing director at GlobalData Retail, told Retail Brew.

  • Blair said customers are getting more comfortable with ordering furniture online; Wayfair execs would likely say the same after reporting profits for two surprise consecutive quarters.

Smaller companies will likely continue growing, but it’s the biggest brands that’ll gain the most share. Already, both Lowe’s and Home Depot are expanding their inventory to include furniture and small decorations. In December, Lowe’s CFO Dave Denton said the company will have a higher operating margin regardless of how the market evolves in 2021.

Feeding the feed

A tiny screen’s the only place many shoppers see brands now. But retail pros thought we should have paid more attention to the apps driving those purchases. Social commerce is the second most “overlooked” trend, said 22.3% of our retail pros.

It was hard to miss. Every major social media platform rolled out updates to turn their feeds into mobile malls. Just a sample...

  • TikTok partnered with Shopify for shoppable ads, with plans to expand into organic shoppable content. Weeks later, it gave Walmart the keys to its livestream shopping tool.
  • Facebook and its sibling apps (Instagram and WhatsApp) grew their suite of shopping tools from storefront profiles to in-app checkout and curated recommendation pages.

If anyone’s overlooking the power of social commerce, it’s the scrollers. Only 35% of U.S. consumers had made a purchase through social commerce by October 2020, per eMarketer.

  • This means retailers in 2021 will need to invest in customer education...and maybe freshen up their grid.

Looking commerce will become more sophisticated, and shoppers will make purchases on the stickiest platforms across markets. eMarketer forecasts U.S. social commerce sales will reach $31+ billion in 2021, a 34.8% increase from 2020.

Shift to autopilot

Supply chain automation clinched the third place spot with 20.6% of readers’ votes.

Retailers’ shelf-stocking ops don’t attract press releases like the items displayed—but innovations don’t happen overnight. “Supply chain automation is complex and costly because many of these technology solutions have to be automated and integrated with [retailers’] POS, store inventory management and optimization that allows for a higher level of accuracy of their inventory,” said Lisa Chai, senior research analyst at Robo Global.

But when a surge in e-comm orders collided with social distancing requirements for warehouses, retailers faced disruptions that upended their typical warehouse practices. That sparked investment in automated fulfillment solutions.

  • Gap pushed forward a transition to using Kindred robots for online fulfillment at Ohio and Tennessee centers; American Eagle installed order-picking robots at its main U.S. warehouses.
  • Chewy opened its first fully automated fulfillment center in October.

Overlooked ➡️ omnipresent. Chai told Retail Brew that 80% of distribution centers still rely primarily on manual labor. But she expects adoption to increase as e-commerce gains share. “Retailers have no choice but to incorporate warehouse automation solutions to make up for the labor shortage and increase productivity,” Chai said.

Sure enough, in a 2019 survey, 80% of supply chain execs in retail and consumer goods said they planned to automate their supply chains by 2021. That’

Honorable mentions

Let’s sidebar for some write-in readers’ choice suggestions.

Look team, no hands: 2020 gave contactless and mobile payments the rocketship treatment, but they didn’t earn as many headlines as Tesla. It’s likely because shoppers still lean on cash and cards.

  • Mastercard said that tap-to-pay or contactless options accounted for 41% of in-person transactions in Q3 2020, up from 30% a year before.
  • Still, less than half of retailers surveyed by Euromonitor in August said they would add touchless terminals to their stores in the following six to twelve months.

Never too late: Rapidly shifting trends sealed the fate of many retailers on bankruptcy watch—until the M&A engines kicked in. Several readers wrote in “acquisition of distressed retailers” among their top overlooked trends.

  • “Overlooked” may be a stretch here. If a Retail Brew went by without mentioning bankruptcy, it was all over other outlets.

Francis Scialabba

If the trends retail professionals considered “overlooked” were hiding in plain sight, the trends voted most “overhyped” were impossible to miss.

  • As with our Overlooked section, we’re highlighting the three trends that received the most votes from readers.
  • There was slightly more consensus on overhyped trends, but still no runaway winner or loser.

Not a supermajority

First up:the ballot box. 31.6% of readers surveyed ranked retailers’ taking a stand on political issues and the 2020 election the year’s most overhyped retail trend.

Any explanation? “2020 was an extremely political year and, against that backdrop, most retailers did not feel able to remain on the sidelines,” Neil Saunders, managing director of GlobalData Retail, told Retail Brew.

So retailers joined the election conversation with efforts considered nonpartisan in past years, like selling voting merch or encouraging employees to vote.

  • Corley Kenna, director of communcations for Patagonia, told Retail Brew that recruitment to Time to Vote, an initiative encouraging businesses to create voting plans for employees, nearly doubled its goal of 1,000 companies by election day.
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“Participating in neutral activities, like voting initiatives, has no real negative impact [on retailers],” Saunders said. “However, getting too involved in partisan politics can be dangerous in a society that is so divided.”

But some retailers tumbled into political backlash even when they tried to appear apolitical. Take Gap’s “Unity Hoodie,” an ad intended to promote bipartisanship that was released immediately after Election Day, but mocked online for misreading the room.

Retailers’ reluctance may come from concerns that it’s challenging to get civic engagement “right.” Kenna said some retailers view even nonpartisan actions, like mask wearing, as political.

Votes aside…retailers are past the point of ignoring politics. Shoppers have high expectations: 56% of respondents to a Morning Consult survey shared with Retail Brew said they pay close attention to brands’ ethical and political stances.

We’ve seen retailers become increasingly willing to take a stand in the first few weeks of 2021. After pro-Trump supporters stormed the US Capitol in an effort to halt the certification of the 2020 election results, retailers responded by…

  • Ceasing their political donations to lawmakers who voted against certifying the US election.
  • Pulling products associated with the rioters and QAnon conspiracy theorists from their e-commerce platforms.

Looking ahead...“Based on the largely positive consumer response this year, we will see more brands voice their support for political issues,” Rebekah Kondrat, founder and principal at Kondrat Retail, said. “But they will be careful to do so in a way that doesn't alienate their main customer base or come across as tone deaf.”

Second is vest

The swift ascent of athleisure and comfortable clothes took the No. 2 slot on our list, with 30.6% of readers ranking it “overhyped.” What does everyone have against leggings as pants?

It could be the effects of surging athleisure on everyone else. The apparel industry split down the middle in 2020—hurting many of the companies repped among Retail Brew’s readers.

  • Formal items (suits) and less-formal-but-still-uncomfy items (jeans) noted steep declines. The dramatic shift in consumer lifestyles, paired with closed stores, tipped several distressed brands into bankruptcy.
  • Meanwhile, sales of items like the “Nike Pro-Chiller Leggings” held resilient through the year’s end. During the holiday season, the NPD group estimated comfy apparel would generate 31% of apparel sales.

Coresight Research predicts athleisure items will continue to swipe closet share from traditional brands, growing around 6.5% annually through 2023. While retail pros may say flexible fabrics are overhyped, they’re still shifting their 2021 product mixes in response.

  • Kohl’s, Old Navy, and American Eagle have announced significant increases in stretchy SKUs—in Old Navy’s case, 55% more product in Q3 2020.
  • Workwear oriented brands like M.M.LaFleur have introduced hybrid items like the “jardigan” for homebound professionals.

Brands that sprinted ahead of the trend are in a better position to meet the growing market. Lululemon was one of the rare brands that returned to pre-pandemic growth in Q3 2020.

The caveat: elastic waistbands don’t fit every brand, Kondrat told Retail Brew. “To truly build activewear as a lasting category, brands must seek to solve a problem for their customers that others are ignoring,” she said.

No blue checks

Rounding out the top three, 28.6% of respondents ranked personality (i.e., celebrity) and influencer-founded brands 2020’s most overhyped trend.

Influence and hype are close cousins, and the chatter surrounding the next public figure to monetize their audience reached a crescendo last year.

  • Celebrities launched more than five new beauty brands. Notable highlight: Selena Gomez’s Rare Beauty, which debuted with an exclusive Sephora partnership.
  • Social media-native influencers entered categories from candles (Jackie Aina’s Forvr Mood) to clothing (Arielle Charnas’s Something Navy).

Naturally, there’s fatigue as well as legitimate questions about the efficacy of personalities turning from selling outside products to their own. It often isn’t clear how much influencers contribute to developing product lines, beyond promoting them to their built-in audiences.

But those audiences delivered. Inventory for the initial launches at Forvr Mood and Something Navy sold out quickly; Rare Beauty was crowned “Start-up of the Year” by WWD. Incorporating brands from years past, some of the most successful retail labels, especially in beauty, are attached to a famous face. (Fenty by Rihanna, Kylie Cosmetics, and the list goes on.)

  • There can be crossover appeal, Blogilates CEO and founder Cassey Ho told Business Casual in a recent interview. Ho built an audience of millions through her YouTube channel, but she said her new fitness collection for Target can ideally reach shoppers who don’t know her.

Just a section ago, retail leaders considered social commerce overlooked. As more social platforms create more shopping tools, influencer-led brands are obvious candidates to take advantage of the content-to-commerce flywheel.

+ While we wrote this, even more brands joined the influencer-as-entrepreneur melee. Jay-Z revealed a forthcoming cannabis brand; Drake released a line of home fragrances that promptly sold out; Halsey launched a beauty brand.

If 2020 taught us anything...

It’s that educated guesses are still guesses. Still, we wanted to know where our audience expected retail to go in 2021.

The top prediction: Digital carts aren’t going anywhere. 56.5% of Retail Brew readers polled said e-commerce’s acceleration will be 2021’s most important retail trend.

  • Businesses from bidet makers to bread bakers recorded online sales growth last year, and e-commerce adoption accelerated by five years. Still, eMarketer forecasts that e-comm will grow to only ~15% of total retail sales in the U.S. in 2021.
  • E-comm could gain share as shoppers continue adjusting to online ordering and as retailers improve their digital operations.

Readers’ second and third most popular predictions are directly influenced by e-commerce’s growth.

Francis Scialabba

In second place...33.9% of readers voted that disruption of brick and mortar retail will be the year’s most important trend. As the digital ecosystem grows, the physical one can’t do anything but evolve. That can look like opening stores closer to core customers, converting more space for delivery and BOPIS fulfillment, or ditching the physical storefront altogether.

In third place...28.9% of readers selected supply chain automation as 2021’s most important trend. I already told you above why this movement’s got robot legs: As 300,000-sq.-ft. fulfillment warehouses sell like bags of flour, retailers will rely on automated support to speed up their supply chains.

But who knows? Readers may become so tired of breaking down their cardboard Amazon boxes, they’ll vote e-comm the most overhyped trend in next year’s survey.

Retail news that keeps industry pros in the know

Retail Brew delivers the latest retail industry news and insights surrounding marketing, DTC, and e-commerce to keep leaders and decision-makers up to date.