2017 was a great year for the ecommerce industry. The worldwide revenue of ecommerce amounted to almost 2290 Billion USD, which is expected to grow at an annual rate of almost 19.11 percent in 2018. This would result in a market volume of 4479 Billion USD by the end of the year 2021. These numbers speak for themselves about the growth of the global ecommerce.
Trends or Fads?
In our globally connected world, fads are now confused for “trends.” It is essential to understand that fads start and end like Twitter trends. Genuine trends, specifically for online business, stay for a significantly longer time. You can afford to ignore fads, but never the genuine trends. Businesses should analyze all fads and trends carefully and avoid the temptation of jumping the bandwagon immediately.
Trends in ecommerce emerge from how customers shop, what they buy, and how they respond to marketing tactics employed by businesses. Within the last decade, a lot of new trends have a profounding influence on ecommerce businesses. Amazon, Walmart, and Alibaba, some of the biggest e-tailers in the world, have been at the forefront of adopting and benefiting from these trends.
Let’s discuss the most innovative trends that might change the ecommerce game in 2018:
Contextual and Programmatic Advertising
Context and programmatic ads will see a rise this year. Social media sites are already revamping the design to cater to these trends.
The new trend, labeled as programmatic advertising, uses datasets to decide the target audience. These ads are shown to the audience chosen on the base of consumption, and then retargeted after a certain period to generate more ROI.
In simple terms, it is about luring the right audience to the right type of ad at the right moment. Compared to basic retargeting efforts, ecommerce store owners stand a better chance of reaching out to a larger audience by using this type of advertising.
Even in videos, AI powered context advertisements that easily blend with the content are on the latest trend. For example, in a scene presenting a bar, an ad for a wine brand will feel less intrusive is likely to sell more wine. These ads are less intrusive and are likely to sell more to the right audience.
Facebook allows advertisers select the audience and target it with the relevant ads. The Facebook pixel learns and gets intelligent with every run. This results in better profit margins in the long run.
Google Admob shows video ads in between mobile games intelligently. When a level ends, a video ad of similar design will appear making an offer. While these ads are less intrusive, the only problem is that sometimes the users think these ads are part of the actual game.
For a lay user, marketing automation generally means automating email marketing and scheduling social media posts.
However, marketing automation has now become the new trend that shows no signs of stopping. It now covers areas including customized landing page and easy-to-access shopping carts.
If implemented properly, automated marketing will let you:
- Send out emails that are tailored for each of your customers.
- Display new products and promotions that are based on the visitors’ shopping history.
- Retarget customers for necessary product sales.
The automation further allows you to customize the store offerings for each of your customers. Automated recommendations get directly influenced by what they bought previously or clicked on during their stay at your store.
Artificial Intelligence (AI)
Customer segmentation and identification of patterns based on their browsing history is one of the biggest challenges that an ecommerce store faces in terms of automation and store personalization. Intelligent algorithms are now hailed as the key to dealing with these challenges. help in achieving this. According to Business Insider, retailers that have implemented personalization strategies see sales gains of 6% to 10%.
The accuracy of data returned by algorithms is greatly influenced by the quality and size of data. This poses serious challenges for small ecommerce businesses that do not have access to vast volume of data. However, these businesses can partner with third party providers with access to large data sets to workaround this restriction. This indicates that more companies will tap into AI powered tools to create personalized recommendations for each user.
Enhanced Shipping Options
Shipping and logistics is one area that had stagnated in the past years. Small improvements (free shipping for instance) did happen, but nothing extraordinary happened until 2013 when the idea of same-day delivery became mainstream.
However, things have started to look up in this area. Amazon has now started testing drone deliveries in USA. With the help of Google Maps integration, these drones could discover the shortest route to the destination. This trend will grow as the technology improves and delivery drones become a viable business component.
Online retailers from around the world confirm that mobile transactions increase each year, especially during the holiday seasons as compared to the previous year. If you don’t have a site which is mobile responsive – NOW IS THE TIME TO MAKE IT RESPONSIVE!
People are now more exposed to their mobile devices than they are to their computers. Gartner says that the ecommerce shopping through mobile will reach an all-time high this year.
AR for Product Visualization
Apple has introduced an ARkit for its new operating system iOS 11. In response to that, Google launched ARCore for Android smartphones. The AR trend will see an upward shift this year because the adoption of AR/VR enabled smart devices will increase.
For example, the new app by Ikea lets the users visualize furniture in their homes using the mobile’s camera.
Voice Search Will Take Lead
Ecommerce stores should start optimizing content for voice search. According to new guidelines by Google, content for voice search should include more textual content in the form of paragraphs. This will allow them to appear in rich snippets and knowledge graph. While using tables and pictures is great but the websites won’t get any benefit from it. Use of voice-enabled buttons can lead to more conversions from smart speakers, thereby improving the numbers for ecommerce stores.
Amazon, NorthFace, and other similar top brands have started making ecommerce skills (apps for voice assistants) that help users directly order through their smart speakers.
Snap and Shop
A new trend of image shopping will emerge, where users will point their camera towards a product they see to order it from an online store. There are many photo apps available like CamFinder, and many more will popup this year. This trend will also lead to selling of affiliate products through photo shopping.
For example, Pinterest has launched its own photo camera that recognizes and interprets images to provide an accurate description of it. It has already partnered with many ecommerce stores and top search engines to provide them with relevant data for making classifying and interpreting images.
Revival of Brick-And-Mortar (B&M) Models
2007 was the year when brick-and-mortar market faced a backlash and ecommerce stores became mainstream. Now, in 2018, things have changed. Brick and mortar stores are coming back with a change. These new retail stores provide in-person digital experiences without storing any actual inventory.
A good example of this is real estate industry. Suppose a client enters a real estate shop and uses a virtual reality headset to see the 3D version of the housing society. This is also being replicated in auto industry where showrooms are now using virtual versions of cars for the first time visitors.
In 2016, Cadillac used virtual reality app for a product demo at a car expo. Other automakers such as Audi, Toyota, and Mercedes are also using virtual reality apps to give users a more welcoming experience.
Subscription Based Models Will Rise
As digital payments become even easier, we will see a rise of subscription-based business models. Companies like Loot Crate and BirchBox will see a surge in orders because of their personalized offerings. The new ecommerce stores can also tap into this market by replicating the same subscription-based models to get recurring sales on a monthly or an yearly basis.
Chatbots as Personal Assistants
We are using chatbots from a few years now. But now because of the use of neural networks, AI-powered chatbots will again see a rise. AI-powered Chatbots help increase the user engagement by providing relevant options to them. Their growth is predicted to reach $1.25 billion by 2025. This year we will see chatbots getting cheaper, smarter, and widespread.
For example, Starbucks allows users to place orders through voice commands or text-based chatbots. These also tell the users the remaining time of the order preparation and the total cost.
Blockchain – The New Shift
We know that blockchain is still in its nascent stage and the market isn’t as big, but the blockchain-based apps look promising enough to get a mention, here is why.
For example, one ecommerce platform made on the blockchain network is OpenBazaar. It is a P2P store where transactions are made through cryptocurrencies. It is completely free for sellers and anyone can easily set up store even without programming knowledge.
OpenBazaar is just example that operates on the ‘proof of work’ model. It is a model where tokens are generated on every transaction, allowing more transparency in the use of ecommerce. To explain it simply, the buyer and seller don’t need a third party mediator. When an order is placed, a block of payment is created on the blockchain and displayed on the network. This again happens when the seller creates the product and ships to the buyer. Three blocks will be created for each cycle. Now, the reason it is great is because of the transparency, authentication, and freedom attached to it.
This year we will see more instances of blockchain-based ecommerce platforms and marketplaces, inventory management systems, and more cryptocurrency payment systems.
More Payment Options Will Popup
We have now multiple payment options available including digital payment methods and cryptocurrencies. More of the latter will popup to cater to each segment such as musicoin for musicians and kodak coin for photographers.
Where ecommerce stores are now accepting cryptocurrencies, smartphone manufacturers have started making digital wallets. All this is done to make payment process simple for ecommerce.
Moreover, now as mobile commerce is taking surge, we will see a rise in adoption of these alternate payment methods for mobile-based payments.
Things to Note
Our world is changing. Ecommerce will only get bigger and better this year and new technologies will help achieve that.
You, as the ecommerce owners, need to embrace the ones that best suit your needs so to provide value to the users. The better the user experience, the better your sales.
What ecommerce trends have we missed? Let us know through the comments below.
Also read the Landscape of Ecommerce in Asia-Pacific to know its potential.
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