Top Retail Trends of 2024

With convenience stores accounting for a whopping 3.1% of U.S. GDP in 2019, Gopuff is making strategic moves in this century-old industry.

For convenience stores, fuel and cigarettes account for the large majority of sales. But while restocking on fuel or cigarettes is what brings many customers in, the margins are lower with these products than with food, beverages, and medicine. Food alone, while only accounting for just over 1/5th of in-store sales in 2017 ($53B), brought in more than 1/3rd of the profit, according to the National Association of Convenience Stores.

As a result, Gopuff — similar to a DoorDash for convenience stores — targets food and wellness products often found at convenience stores. In 2019, the Gopuff app went from 275k monthly downloads in June to 350k monthly downloads in August and is the 22nd most popular iPhone app in the food and drink category.

The potential impact here is significant, as over half the US population visits a convenience store on a daily basis.

Instead of buying products directly from the 150,000+ convenience stores around the country like Instacart does with grocery stores, Gopuff maintains a network of 700 warehouses in around 1,200 cities and college campuses. This gives them more control over pricing and makes their business more defensible at the price of making it potentially harder to scale.

The app's use among college students, who are often using their purchasing power for the very first time, is very attractive to the brands Gopuff buys from.

And as this is happening, the line between snacks and meals is blurring. Research shows that consumers are eating more meals at non-standard times and that snacks now account for over half the times younger generations eat.

Through ordering via the app, the company is also bypassing the stigma users may fear when buying certain products. Gopuff highlights the relatively high order volume for Plan B as an indicator of this.

America’s fastest-growing marketplace looks more like a social app than a shopping site. In fact, many of the participants aren’t even there to buy, they’re there to be entertained.

It’s called Whatnot: a live-selling site founded just 3 years ago and recently valued at nearly $4B. The site holds auctions alongside a live group chat, strategically combining two of the most powerful levers in conversion: social proof and urgency.

With similar dynamics to live, in-person auctions, Whatnot buyers are heavily influenced by other buyers’ excitement as the auction escalates. What’s more, the perception that there’s a large crowd, all going after the same product, reinforces trust and appeal. And the numbers are impressive: engagement metrics resemble that of a social app while conversion metrics match that of a high-performing ecommerce marketplace.

While live selling is a growing phenomenon in the US, it’s been exploding in China for years. For the first time, in 2020, Chinese live-streamed shopping GMV ($137B) surpassed total US digital ad spend ($135B). Many in the space see it, and its slew of competitors, as retail-killer apps.

Ironically, Amazon’s push for faster and faster shipping is, in some cases, working against them. In many ultra-urban landscapes, local stores can effectively offer near-instant delivery because their stores are essentially fulfillment centers.

And while Amazon’s rise knocked out many rivals who competed on price, it actually in some ways created more room for those who don’t compete on price. More specifically, Amazon’s rise led in large part to the bankruptcy of Borders in 2011 and caused Barnes & Noble to drastically cut its retail footprint. But independent bookstores fared well during the same timeframe. The number of independent US bookstores grew by roughly 50% from 2009 to 2018.

OrderChamp - a wholesale marketplace for independent shops - was built on the notion that independent retail will not only endure, but can thrive despite changing conditions. With the transition to an online world, independent retailers will need a number of tools to support their growth.

A similar company, Ankorstore, creatively solves several other supply chain problems too. By setting order minimums based on total order size rather than order volume from a single seller, Ankorstore replicates the economics of the food delivery company Chowbus, which lets customers order from several different restaurants in one order (so they can buy dinner at one place and a drink at another, for example). This means that sellers whose minimum order quantity is close to the Ankorestore minimum can still get orders, while stores aren't stuck with more inventory than they can sell. Smaller order sizes allow stores to experiment with new products they aren't sure they will stock long-term.

Nearly half a trillion dollars worth of consumer goods are returned every year, 25% of which happens right after the holidays— and as ecommerce return windows lengthen in an effort to compete with retail, there are all sorts of secondary side effects— for example, returns are often done out of season, meaning companies must hold refurbished inventory on hand until next season, losing additional value in the process.

While only 5-10% of in-store purchases are returned, 15-40% of online purchases are returned. This dynamic has created a growing micro-industry: buying pallets of assorted returned products from stores like Amazon, and reselling the items one at a time.

It’s somewhat surprising that this industry exists, because companies like Amazon in particular are famous for squeezing out every last bit of profit. But sorting through returns, judging their quality, getting them back into the warehouse, then dealing with an inevitably higher rate of customer complaints is not profitable for Amazon.

Walmart’s 2-week return period means that their pallets of returned goods are in many cases more valuable than those from Amazon which have a 4 week return period. The longer a product is in a consumer’s possession before being returned, the more wear and tear and potential for damage.

And as ecommerce grows beyond its current meager 16% of total retail spend, and is forcefully boosted many years forward by the pandemic, the total value of returned goods will soon likely be in the trillions of dollars.

As demand for returned-item pallets rises, companies like Bstock.com and Liquidation.com are gaining in popularity. The industry’s growth has also been fueled by another phenomenon: small business influencers who turn the pallet-opening process into a video experience, similar to unboxing videos. Liquidation pallets have surprises built in: there’s a mix of products, some exciting because they’re valuable, some exciting because they’re strange.