The current state of eCommerce
Global eCommerce continues to grow, and based on Statista research, is predicted to hit $6.5 trillion in 2023, despite the current economic uncertainty and cost of living crisis.
However, time spent on line (across websites and social media) is level with 2017. The average adult is awake 15 hours a day, and apart from during the pandemic, is typically spending 6 hours 43 minutes online – just under half of their waking time :
Add to this that Forbes research in 2021 says that 75% of consumers only buy once from an online shop, and you can see that the competitive landscape is becoming trickier than ever to navigate.
With the increase in Social Media channels, the number of touchpoints is growing, as is the need for all channels to work with all channels so that the right conversation is made at the right point of the customer journey to win high conversions.
Online sellers now need to be more focused than ever on how they recruit and retain their customer base across multiple channels, their messaging has to be more engaging and relevant than ever before, and the delivery and service proposition needs to be both stand out and economically efficient.
So what are the key trends in eCommerce, and how are businesses innovating to make the most of them?
6 digital commerce trends
1. Omnichannel Commerce
After 2 years of online shopping, consumers have found new ways to engage with businesses before deciding how, when and where they want to buy. They can be in store whilst checking out your Social Media page, or looking at online availability to get what they are looking at delivered to home. At home, they can read reviews and compare your products from the comfort of the sofa before deciding whether to visit.
Customers expect to move seamlessly between platforms, so ecommerce businesses need to keep up – a consistent brand, one view of the customer and a flexible pool of stock to work with.
2. Mobile Commerce
In 2021, 73% of ecommerce traffic was on a mobile device (Statista / Finance online) , so mobile first website design is a critical success factor. Your site shouldn’t just shrink to size, it needs to be responsive so that it fits the variety of screen sizes available to users today.
To make Mobile usage easy, consider Apps, phone friendly payment options like Google and Apple Pay, and maybe even SMS marketing.
3. Social Commerce
Social Media was created with the intention of connecting people to get them communicating, so consumers expect to be able to have a conversation with you when they want to, or need to.
Chatbots are getting better and are great for handling Frequently Asked Questions, Smart Speaker usage is on the increase, and businesses are increasingly using WhatsApp as a platform for conversations directly with a shopper. User generated content is also highly valued by both customers and Google, so there are benefits all round from conversational commerce.
More pertinently, Social Media shopping is growing fast now that platforms such as Facebook, Instagram and Tik-Tok have “Buy Buttons”, allowing you to purchase without ever visiting the website.
Recent data from Statista forecasts that Social Commerce sales globally will grow from $992 billion in 2022 to $2.9 trillion by 2026. Ignore Social Commerce at your peril.
4. Shoppable Livestreams
The pandemic saw the launch of this style of selling in the Far East, and it’s now moving West.
Think of a shoppable livestream as a store event, but online. They are hosted by a presenter (often an influencer) in a physical location. Shoppers can ask questions about the products and get to see how the presenter responds and interacts with the products they are interested in. Consumers can buy during the event, and the sale is processed through the website.
Sustainability is a key element of the buying process in ecommerce today. When you hear that 65% of consumers are using some sort of resale or recommerce service, you have to sit and take note.
There are many ways to buy – rental services, second hand products, or sustainably manufactured products. However, do check your facts before creating your marketing programme as you don’t want to be accused of greenwashing like H&M.
Purpose driven consumerism is a huge trend amongst the younger generations in particular.
6. Subscription Commerce
The cost of customer acquisition is generally a relatively big number, so it’s no wonder that businesses are looking for new ways to retain customers and create repeat transactions. Subscription services have grown, predominantly in categories where repeat purchases are common, delivering simplicity and convenience to the customer. Harry’s razors are probably one of the best known examples, but you will see an increasing amount of subscription offers for products ranging from vitamins to make-up and even men’s underwear.
6 areas of innovation in ecommerce
1. Multichannel Personalization
Personalisation has been around a while, and there are many CMS / automation platforms that help create a personalised experience within a specific channel. The Multichannel personalisation concept is now being extended to cross platform selling – giving customers the same personalised experience, regardless of the channel they are interacting with you on. This is invaluable when you consider the increased number of touchpoints in the customer journey. Check out Amazon Personalise and Google Cloud Prediction to find out more.
2. Artificial Intelligence
As examples, AI can be used to improve workflows for personalisation, customer service, fraud prevention, sales forecasting and pricing. Retailers have been early adopters of this technology, and online spending on AI is expected to reach $7.3bn in 2022.
AI technology is advancing in most areas of business, and the more it gets used, the more data it has, so the better it becomes.
3. Augmented Reality
The metaverse is here.
Virtual Reality (computer technology creating a simulated environment) has evolved into Augmented Reality (which simulates artificial objects in a real environment).
Why does this matter to ecommerce businesses? AR allows customers to preview products in their own environment, providing services such as …
- Virtual dressing room – you see clothes on an avatar of yourself
- Preview placement – you see pieces of furniture in a photo of your room in your home
- Design assistance – you see the colour combinations of a new car
- Interactive user manuals
- Social Media filters – like the ones you see on Instagram and Snapchat
4. Payment options
One of the top reasons for cart abandonment is a difficult payment / check-out process, so it’s always a key priority to continuously find ways to simplify the payment process.
Here are the top reasons for cart abandonment based on research from Baymard Institute and summarised by FinancesOnLine :
If “not enough payment methods” causes 8% of cart abandonment, and you are only set up for credit and debit cards, you are missing a trick. According to Statista, around half of ecommerce transactions are now made on digital mobile wallets, so you should not miss these options for payment.
- Paypal – is the top online payment method, taking 60% of market share
- Cashless society – as we use cash less and less, mobile wallet usage (e.g. Apple Pay and Google Pay) will only increase, particularly for in app purchases on social media
- Buy now pay later – flexible payment options, such as Klarna are favoured by younger audiences looking for options to spread the cost of larger purchases
- Local payment options – if you trade Internationally, research popular payment methods in the countries where you trade and payment consolidation platforms to simplify your accounting.
5. Voice shopping
Over 30% of internet users are now using voice assistants, so it’s no surprise that a big emerging trend is voice shopping. Amazon, Walmart and Alibaba are leading the way, so it won’t be long before this method of shopping becomes expected as standard for commodity products where a visual is not an important cue for a customer.
6. Service and fulfilment
Person to person customer service quality took a big hit over the pandemic – long wait times to get someone to answer queries was not uncommon. But that doesn’t make it alright. The use of chat bots have helped with handling customer queries, and vehicle tracking technology has improved so that delivery time accuracy is better than ever before. Here are a few of the areas where advancements are being made.
- Cross-channel service options – Buy on line, collect in Store and Buy in store for Home Delivery are both growing options. Convenience for the customer is key.
- Returns – Distance selling regulations mean that handling returns are part of the economics and service proposition of ecommerce, so use advancements in automation to make it an efficient, positive experience.
- Packaging – your packaging is part of your brand, and also part of your cost structure, so getting the balance right between on-brand design, the right size to be handled economically and ticking the sustainability boxes are all critical.
- Communications – when you make a customer promise, you need to keep it. For those times when you don’t, early pro-active communication is much more effective than hoping the problem will go away. With automated communications functionality widely available, there is no excuse for not informing customers when there’s been a bump along the way. Don’t leave me hanging on the telephone!
The customer journey used to be fairly linear, but technology today means that people can easily research and shop cross-platform. The customer isn’t engaging with the platform they happen to be on, they are engaging with your brand – making your customers feel like they are the centre of your multi-channel world is the way forward.