The past year has seen a massive boost in eCommerce growth. Statista reports that eCommerce retail revenues are projected to reach $6.54 trillion in 2022. Online shopping is one of the most popular online activities worldwide.
Although shoppers still like to see some products in-person, eCommerce is set to surpass in-store retail sales by almost 900% in the coming years. New technology is becoming more accessible, allowing brands to create unique, personalised shopping experiences that are convenient for customers.
But eCommerce growth via online storefronts is just part of the trend. Mobile eCommerce sales are also increasing as shoppers use apps and exclusive mobile offers. Let’s review some trends we saw in 2020 and how they’re paving the way for next year.
Latest Ecommerce Trends of Note
This year, several unexpected trends cropped up as a result of many businesses having to create an online presence. Some of these businesses are new to the online environment, while others have worked to improve their online store to compete with pre-existing eCommerce brands.
Other trends came from the interests of those shopping online, as well as the devices they use. Let’s take a more in-depth look at the significant recent trends in the eCommerce industry.
1. Mobile commerce soared.
According to a report from Adobe, total online spending in May hit $82.5 billion, which is a 77% increase year-over-year. Mobile commerce grew by 10%.
More shoppers regularly use their mobile devices for many tasks, including checking email and paying bills. Using a smartphone to make purchases is getting more comfortable, especially with dedicated apps and ‘buy now’ buttons on social media platforms.
By the end of 2020, Insider Intelligence predicts that mobile commerce will reach $284 billion, or 45% of the total U.S. eCommerce market.
As many as 59% of shoppers surveyed by Google said that being able to shop on mobile is essential when deciding which brand or retailer to buy from.
According to Statista, mobile commerce is set to outpace other digital business in 2021.
2. Chatbots and real-time customer service.
A chatbot is a software that provides help to customers without human assistance. Chatbots can complete a text chat conversation on a website, send notifications, and highlight special offers. As many as 80% of businesses use or are planning to use chatbots.
Chatbots appeal to younger shoppers because they often prefer text messaging over email communication and phone calls. A chatbot provides direct information for online shoppers who need it. They’re handy for answering basic, repeated questions such as ‘what’s your return policy?’ and ‘can you give me a delivery update?’ that might not need a full conversation.
Chatbots also can automate customer service and provide it in real-time. This software can help customers find specific products, answer questions or send personalised offers based on their preferences. This is the kind of personalised online shopping experience many customers are looking for.
3. BNPL options.
Buy now, pay later (BNPL) is a checkout option that allows shoppers to get the items they want and pay for them later, similar to how a credit card works. A customer has to be approved for a BNPL agreement, and they usually will pay in instalments over a specified period. There is often a service fee (generally between 2% and 8%) added into the price of the items as well.
This type of financing capability is expanding and looks set to continue doing so. According to Mastercard, the market is growing at an annual rate of 20%. A report from IBISWorld predicts that the BNPL industry will produce approximately 10% annually to reach $1.1 billion in 2025.
A survey from PYMNTS and PayPal revealed that 48% of consumers who prefer BNPL options wouldn’t buy from eCommerce stores that did not offer it. Even smaller purchases like high-street fashion, rather than expensive furniture, can take up BNPL offers now.
Top Ecommerce Trends That Will Thrive in 2021
The notable eCommerce trends of 2020 will factor into what’s popular in 2021. After all, 2020 was a big year for change in the way people shop and what they shop for. Although online retailers succeeded with traditional retail tactics, other methods of selling are on the rise. Let’s look into the future of eCommerce:
1. Omnichannel retail will flourish.
Omnichannel retail is a business model in which all existing sales channels become wholly integrated to offer customers a seamless shopping experience. This type of model sends shoppers on a non-traditional customer journey that may begin with a search engine and go through an online storefront and paid content before making a purchase. It’s no longer enough to have a Shopify store and call it done.
With this approach, all of the efforts — both organic and paid — are focused on the customer completing the purchase, no matter how they get there.
According to research from UC Today, consumers go through an average of six touch-points with nearly 50% regularly using more than four before making a purchase. This research also revealed that 9 out of 10 consumers want omnichannel service.
For example, when a shopper has interacted with a brand online via chatbot and then is redirected to another agent on the phone, they expect the agent to have access to the previous conversations and be able to continue the interaction seamlessly.
The custom furniture company, Burrow, went from being a single product, single-channel, single vendor business to a multi-product, multi-channel, multi-vendor enterprise. For it to work, they used BigCommerce as their eCommerce platform, which helped integrate all of their channels for a seamless shopping experience.
2. Automation enables productivity and growth.
Automation allows tasks to get done without human assistance. This could include anything from scheduling emails in a customer relationship management (CRM) solution, providing data analytics, or leveraging advanced technology to help with hiring.
Automation is often discussed in terms of robotics and machine learning. One good indicator of coming trends is funding — and this one is a winner. In just the last several months, an open-source conversational AI platform for chatbots and voice apps received its fourth round of funding, and an autonomous forklift developer has raised $15 million.
Retailers will be able to use robotics to scan SKUs in warehouses and maintain inventory. This will save money and time. According to research from ABI Research, more than 50,000 warehouses around the world are expected to include commercial robotics by 2025. This is a dramatic increase from the 4,000 warehouses with commercial robotics in existence in 2018.
Many retailers with an online presence use these robots for a range of tasks. There are autonomous mobile robots that can transport inventory to articulated robotic arms that can manipulate items to automated storage and retrieval robots that retrieve items for use.
Machine learning and artificial intelligence
Machine learning and AI are significant drivers in the rise of automation. Servion predicts that AI will power 95% of all customer interactions by 2025, with consumers expected to prefer interacting with machines over humans.
According to IDC, revenue generated by AI hardware, software and services is expected to reach $156.5 billion globally, by the end of 2020. This is a 12% increase from 2019.
3. Rapid global eCommerce expansion.
McKinsey data shows that consumer optimism has decreased in most countries, because of the coronavirus. But the pandemic was also the driver in the acceleration of eCommerce, as many consumers could avoid brick-and-mortar stores by placing orders for essential items.
This creates an opportunity to expand sales to other countries where e-commerce rates were once low.
The same report found the countries with a higher intent to shift to online shopping include the U.S., India, South Korea, and Japan. While Australia has lagged in e-commerce adoption, COVID-19 has led to accelerated shifts in shopping for non-basics on websites they haven’t used before.
With so many global e-commerce stores, like Amazon, competition can be fierce. Brands will have to do their research into whether or not an international expansion makes sense for their business. Some things to consider:
- Is there a demand for my product or category in that market?
- Will my eCommerce marketing plan translate cross-culturally, or will the brand need to invest in unique campaigns?
- Do we need to localise our eCommerce site for an international audience?
- Which payment options are most popular in the target country?
- How will we approach cross-border shipping?
Consider all the costs of marketing, selling, and shipping internationally so you can assess whether it will be worth it for your brand. You may need to change your pricing depending on the region. Also important to note: in selling to the mobile-first areas like APAC, Africa, and the Middle East, delivering an easy-to-use mobile shopping experience will be critical.
LARQ — a company that creates and sells reusable, self-cleaning water bottles — expanded internationally early on with a Kickstarter campaign. Using BigCommerce, the LARQ team was able to launch a site with multi-region capabilities and accept various currencies from a single location. They launched multi-currency in early summer 2019, which drove about an 80% increase in conversions over just three months.
1. Headless commerce.
Headless commerce is a trend that will affect the architecture of the online shopping experience. Headless architecture decouples the content management side of an eCommerce website from the presentation layer the customer sees.
Headless commerce can provide brands with increased levels of:
- Website customisation and personalisation options.
- Flexibility, familiarity and fund-savings for developers.
- Marketing effectiveness for innovation without hurting backend processes.
- Speed to market for international and omnichannel GTMs.
- Conversion rates and lower customer acquisition costs.
2. Stores will prioritise accessibility.
Ecommerce stores that prioritise accessibility for shoppers that utilise assistive technology will drive business. Essential solutions like implementing ramps instead of stairs, widening walkways and training your staff are crucial. So too are technology-driven solutions, like product labels that can work with screen readers and accepting mobile payments.
Data from the Pew Research Center shows that 85% of Baby Boomers (ages 55-73) use the internet and shop online. Ignoring the specific needs of this generation in online shopping experiences would not be a wise business move.
That said, even eCommerce requires improvements. Businesses that rely on calls to contact centres without offering text-based alternatives are inaccessible for many. Online stores need to be designed with colour blindness in mind, the ability to adjust the font size, and voice search. Accessibility isn’t just for brick and mortar stores – it’s essential for websites too.
3. Sustainability is critical.
Consumers are becoming more aware of their environmental impact when it comes to online shopping. An online study conducted by Nosto revealed that 52% of participants wanted to see more sustainability in the fashion industry, while 75% wanted brands to use less packaging.
As a result, brands are finding ways to make new products and packaging more environmentally friendly. Some of these sustainable initiatives include:
- Biodegradable packaging
- Sourcing products from fair-trade organisations
- Going paperless
- Using recyclable supplies
- Conserving energy by demonstrating that your business uses LEDs, turns off all computers at EOD, employees work from home, etc.
4Ocean is an eCommerce business whose entire model is focused on sustainability. They sell bracelets and apparel but are also dedicated to returning their profits to helping clean up the Earth’s oceans of plastics. Naturally, they’re committed to sustainably in all aspects of their business from the products to the packaging. They use 100% recycled apparel mailers for their products and worked to custom design them to fit their products.
4. PWAs improve mobile commerce — and then some
Progressive Web Apps (PWAs) utilise cutting-edge online technology to deliver an internet experience that’s closer to a native app instead of a traditional web page — especially on a mobile device.
These apps are gaining popularity because they facilitate a reliable user experience at lightning-fast speeds, and have engagement capabilities like sending push notifications and appearing on a device’s home screen just like an app.
Shopping on mobile devices isn’t just a novelty anymore — it’s happening a lot. Apps are expected to have the same functionality as websites, if not more. Sales via smartphone are expected to rise significantly, to reach more than $432 billion in 2022.
5. Customer experience becomes a driving force in development.
As many as 57% of online shoppers say they’ve stopped buying from a merchant because of a bad experience, or because of a competitor that offered a better one. Providing an exceptional customer experience is a differentiator that creates brand loyalty, and it’s key to giving online retailers a competitive advantage.
Personalised shopping experiences promise to meet an individual’s distinctive physical, psychological, social, and emotional needs. These personalised experiences lead to greater customer satisfaction, and it all starts with data collection to better understand the consumer’s needs and wants.
Customers not only want, but they expect a personalised online shopping experience just as you would expect a barista at your favourite coffee shop to remember your order. According to Google, People are 40% more likely to spend more than planned when they identify the shopping experience to be highly personalised.
Some of the ways eCommerce companies can offer that personal experience online include showing recently viewed items and product recommendations to returning customers or offering a first-purchase coupon for first-time shoppers.
Customer service and chatbots
The rise in online retail lends itself to a greater need for customer service. Shoppers want answers, and they want to get direct answers in real-time, which is why more brands are implementing chatbots. Chatbots allow your business to provide access to solutions, even when your customer service team is offline.
In a survey from Drift, 34% of online shoppers utilise a chatbot as a way to get connected with a human. As many as 33% of eCommerce customers want to use a chatbot to make reservations or place online orders.
A product video often demonstrates the benefits of a product and is a great way to speak directly to potential buyers and convey targeted messaging that drives sales. Having video on your product page can increase conversions.
From the other perspective, 84% of people say they’ve been convinced to purchase a product or a service by watching an eCommerce brand’s video.
Tools to create augmented reality (AR) experiences are becoming more accessible, and brands are implementing elements to improve business. The market for AR technology is growing, with projections for 2023 valuing it at more than $18 billion, according to Statista.
Through photography, graphics and sound, AR can create unique eCommerce experiences that simulate an in-store experience, such as a virtual dressing room to try on clothes or a 360-degree model demo.
The number of mobile users globally is expected to reach 2.4 billion by 2023, driven partially by a growing desire for AR technology to enhance consumer experiences in media and entertainment.
6. Subscriptions eCommerce will continue to climb.
Over the years, subscription services have become a more popular way to get products delivered to your home. From meal kits and beauty products to personalised clothing selections from fashion brands, consumers see convenience in these direct-to-consumer options.
On the business side, subscriptions to a service (whether that’s cloud storage, a video conferencing solution, or graphic design software) are a way to solidify sales month-over-month and plan for inventory.
7. More B2B brands will adopt an eCommerce strategy.
As the new generation of B2B buyers comes into play, their preferred method of purchasing (online sales) will surpass older processes.
In general, B2B customers want to enjoy the convenience of eCommerce, which includes personalised shopping experiences and opportunities for self-service.
Now that Millennials are at the forefront of many B2B buying decisions, buyers are looking for a streamlined digital purchasing experience.
In demand Gen Report, 55% said, when all other factors are equal (e.g., price, quality), “a digital buying experience is essential to selecting a vendor.”
We may not see certain aspects of eCommerce marketing, like using influencers or a shoppable Instagram page, fully embraced by the B2B community in 2021, but it’s worth watching out for.
Ecommerce is continuously changing. It’s probably not feasible for a small eCommerce business or startup to try all of the 2021 trends in an efficient manner. Instead, evaluate the trends as they come and see if they make sense for your business.
Make an effort to stay up to date with industry reports and relevant data to help evaluate new trends. Assess your customer behaviour and decide if a specific movement would align with what the numbers show. Don’t be afraid to ask for feedback from your customers — they may give you a new idea.
Finally, please take a look at what your competition is doing and how it’s working for them.
The pandemic changed the shopping habits of many online customers in 2020. In 2021, those new habits are likely to stick around, driving the increase of eCommerce for the future.
Originally published Dec 03, 2020, updated Jan 16, 2023