We are a quarter of the way through the 21st century.

I was reminded of that fact the other day, and it made me pause and reflect on what has happened over the last 25 years, particularly when it comes to the consumer retail experience.

If we think about where we are today….

Many consumers start their shopping journey on their mobile phones.

Some start with search engines, some start with maps, some start with apps from their favorite brands on their phones, while others look to social media for inspiration.

More recently, though, many are increasingly looking to generative AI-powered tools to help them do things like identify and research brands, comparison shop, generate gift ideas, plan trips, and compile shopping lists.

When visiting a physical store, consumers nowadays might not be going there just to browse and shop; they could be attending an experiential event hosted by the retailer or brand, or they might be picking up or returning things they have ordered online.

The experience that a consumer has with a brand has become the defining factor in their decision-making.

While they expect a personalised experience, they also fret about their personal data, security, and privacy.

Recently, many of their budgets have come under pressure due to inflation and tough economic conditions, which have meant that they have become increasingly discerning about what to spend their money on and with whom.

As a result, they will often shop for value but then save up and splurge on luxuries from time to time.

Increasingly, many are using facilities like Buy Now Pay Later (BNPL) to help manage their budgets.

However, their loyalty is hard won. While discounts and rewards can help, their loyalty is increasingly driven by their values, ethics, their buying and service experience and the sustainability of their choices.

Speaking of the service experience, when faced with a problem, they will often try to self-serve using chatbots, knowledge bases, online portals and other digital facilities. They often get frustrated when they can’t solve their queries using these facilities, with many still preferring to speak to a human being when it comes to seeking help to solve their problems.

If they struggle to obtain the right sort of help in a quick and effective manner, then they will often take their business elsewhere. If their experience is truly bad, they may even vent their frustration via social media channels.

That is a very quick and incomplete picture of what many consumers do and feel today when it comes to their retail experience.

However, if you cast your mind back, it wasn’t like this at the beginning of the 21st century.

Twenty-five years ago, online shopping was new, and consumers were initially sceptical of buying things online.

But, they slowly warmed to the idea of increased choice, convenience, and the potential savings that could be had from shopping online. This shift was supported by the rise of things like reviews and ratings, social media, broadband internet access, and the advent of the mobile revolution with the introduction of smartphones and 4G connectivity.

Now, while consumers were warming to the idea of online shopping, many traditional retailers struggled to adapt to the emergence of both online shopping and the growing primacy of mobile. At the time, according to Nikki Baird, VP of Strategy and Product at Aptos, many retailers “prioritized the creation of high-touch, high-value in-store experiences” while their “online operations were often treated as a separate store”. Some of the key challenges that traditional retailers had to navigate with the emergence of this new channel included how to manage inventory across their online and physical locations, how to manage operations, how to respond to new online competition and how to also respond to the emergent consumer behavior of ‘showrooming’, which involved customers examining merchandise in a traditional store and then choosing to buy it online, often a lower price.

Twenty-five years on, many retailers, according to Baird, are still struggling to “figure out the right balance between their investments in digital versus physical retailing,” given that “while digital investments often yield a quicker ROI, retailers are increasingly recognizing that digital doesn’t scale nearly as well as investments in stores.”

Now, if navigating those challenges weren’t enough, since the beginning of the century, retailers have also had to contend with numerous global crises that have significantly affected most consumers, particularly their purchasing power and behaviour. These crises include the Global Financial Crisis of 2008, the Great Recession that followed, the COVID-19 pandemic of 2020-2022, and the cost-of-living crisis of 2023, whose effects still persist for many today.

According to Baird, the crisis that had the biggest impact on consumers was the Global Financial Crisis of 2008 and the Great Recession that followed, which “pushed consumers towards deal-seeking and selective luxuries” and led to “a bifurcation of the retail sector.”

Moreover, Baird goes on to say that “the lessons learned by consumers coming out of the financial crisis are the tactics they’re using in uncertainty today: deal seeking as much as possible, but also splurging on small luxuries.”

Amidst all this, driven by the growth of cloud computing, Software-as-a-Service (SaaS) products, and, more recently, AI-powered software, we have witnessed significant shifts in the enterprise technology landscape. Brands now have the tools to better understand their customers, serve them more efficiently, and provide a more personalised experience. However, this has also created challenges for many organisations, which have struggled to digitally transform their operations at a pace that has met the rising expectations of their customers.

This has come into sharp focus over the last decade or so, as Gen Z, the first digitally native generation, has emerged as a major consumer group. Their inherent digital fluency and high expectations have increased the pressure on retailers to accelerate their digital transformation efforts.

That pressure is only set to increase over the coming years, with the U.S. Bureau of Labor Statistics projecting that Gen Z will make up about 30% of the U.S. workforce by 2030.

Reflecting on all of this, we can say without doubt that, over the last twenty-five years, we have witnessed unprecedented technological advancements, a number of significant global crises, fundamental shifts in consumer expectations and behaviours and the rise of digitally native consumers, which together have radically reshaped the retail customer experience.

Now, one could argue that everything has changed. Channels, technology, consumer behavior, demographics, economics: All of it has changed.

However, one could also argue that many things have stayed the same.

For example, while consumer expectations may have risen, consumers are still predominantly value-conscious. Whether buying things or seeking help, they prefer convenience, but over-ridingly they want things to be easy and quick. They are happy to help themselves, but also when needs be, they want to be helped. However, they don’t like to wait or repeat themselves and want their time to be valued.

But, most importantly, they want to be seen, heard and respected.

With more data and technology at their disposal than ever before, brands would do well to not get carried away with the tools that are available to them and keep these truths in mind if they want to thrive in the coming 25 years.

This post was originally published on Forbes.com. 

Credit: Photo by Maddy Ramsay on Unsplash