The NRF (National Retail Federation) had good news for the nation’s retailers last week—they’ve already upped their 2021 retail forecast. The NRF now expects 2021 retail sales to grow between 10.5% and 13.5 %, reaching between $4.44 trillion-$4.56 trillion. In addition, non-store and online sales are expected to grow 18%-23%, ranging from $1.09 trillion to $1.13 trillion as consumers continue to embrace online shopping. And these numbers don’t even include sales from automobile dealers, gasoline stations, and restaurants.
In 2020, retail sales totaled $4.02 trillion, of which $920 billion was from online purchases and sales made through non-store channels.
This surge in sales is part of overall GDP growth, which the NRF predicts will “approach 7%, “compared to the 4.4%-5% forecasted earlier this year.”
NRF Chief Economist Jack Kleinhenz says, “We are seeing clear signs of a strong and resilient economy.” And given the surge in consumer spending, Kleinhenz is anticipating “the fastest growth the U.S. has experienced since 1984.”
NRF President and CEO Matthew Shay says, “The economy and consumer spending have proven to be much more resilient than initially forecasted…The pandemic was a reminder of how essential small, mid-size, and large retailers are to the everyday lives of Americans in communities nationwide.”
The announcement came at the first-ever NRF State of Retail and the Consumer, which also offered valuable insight from some of the nation’s most successful retail operations. The NRF says retailers need to understand the “new citizen shopper” who is focused on the credibility and values of the businesses they frequent.
The panelists agreed this is a good time for retailers to “look inward” and be clear about their brand’s identity. You need to know who your customers are and how you want to align with them. And be “ok with [possibly] losing some customers.” Plus:
- You can’t be one-size-fits-all to all shoppers
- You must deliver on your brand promise
- It’s an excellent time to review and possibly refresh your brand promise
- Make sure consumers understand your brand proposition:
- Consumers want more than just good products at great prices and are looking for quality products.
- Brands need to stand for something
- Concern about climate change is universally rising
- Sustainability is key
Consumers also want to do business with companies that look after their employees, have made inclusivity a priority, and have committed to being a better company.
Shay says consumers don’t want to give up their new behaviors (this also means things like curbside pickup and buy online/pickup in-store will remain popular). Consumers, says Shay, are looking for “convenience and safety, and other kinds of leadership.”
In other good news, the NRF reports most consumers support small businesses and are concerned about businesses in their communities.
Overall, the NRF says this isn’t about going back to normal. Instead, “reimagine a new world.”