Only 12 months ago, the expectation was that 2022 would see an emergence into a period of relative stability after two years dominated by the pandemic. Many scoffed at the idea that food inflation would exceed 10% and the belief was that the economy would stabilise after a difficult opening four months. Doesn’t it seem like a long time ago?
Maybe the one lesson of the last few years is that it is remarkably difficult to forecast and predict. At the start of 2020, few even knew of Covid and that all changed within 2 months. At the start of 2022, many did not see the fallout of the Ukraine-Russian tensions. No one expected to see three Prime Ministers in Downing Street. The expected, and hoped for stability did not materialize, and 2022 was arguably harder than the two preceding years.
However, so much has changed against this back-drop. Businesses have adapted, often successfully. The hospitality industry has once again proven just how robust and resilent it is; to never write it off for it will bounce back. The consumer too has adapted and changed. There is light at the end of the tunnel as a whole number of good developments have emerged as a result of all the bad.
So what can be expected for 2023?
- Customer expectations have risen almost in spite of business facing all the challenges which it has. They are asking for more and this will arguably lead to:
- A resurgence of bespoke, personal service supported by stronger adoption of robotics
- Stronger digital innovation and advancement. It is argued today that 80% of customers start their buying journey via digital routes and this is set to increase. In 2018, many would look up information on their phones for convenience. Today it is a central part of the journey. This is doubled, even perhaps tripled, in advancement since 2020.
- The customer experience will become a major differential for every hotel, venue and restaurant and today will be measured on public forums against others. The question therefore is – how does one improve the customer journey against a difficult backdrop?
- Companies will reinvent and redevelop their employee loyalty schemes to combat the great resignation and seek to fight to retain the best talent.
- There will be greater investment in talent development again for the first time in over twenty years.
- Brands will seek to reach and connect with their audiences in new ways. Many brands today are investing more in new consumer experiences than in traditional advertising and marketing. How can a brand become part of, even an extension of, the customer’s immediate daily life?
- In the same way companies will reinvent employee loyalty schemes, so new customer schemes will emerge but not based on discounts but more on how companies can either provide cash back or support on the cost of living crisis. For many Gen Z, they have faced a challenging entry into the working world and their cash resource is a constant battle. They are adapting and changing as a result
- This will inevitably impact on the High Street; on where they seek to drink and eat.
- Workplaces are expecting an increase in overall densities in the office but accept that the new norm will be in place by the end of Q1 – with the average standing at 70% of 2019 levels over the course of a week. The question then is how will companies re-evaluate their budgets for support services?
The above expectations are relatively safe forecasts as already in development and evolution. They are the results of the last two years but 2023 will bring more change on top.
It will be another roller-coaster but hopefully more stable than 2022 was, even with a recession.