The eCommerce industry has always developed and grown in a fast but steady manner. After the COVID-19 pandemic outbreak, specialists witnessed a dramatic surge in online sales. A UNCTAD report revealed that the share of online sales in total retail sales increased from 16% to 19% in 2020.
Since more consumers now shop online, eCommerce businesses need to adjust their shopping experience to a new reality. We’ve analyzed the opportunities emerging in the online commerce market and distinguished top eCommerce trends for 2021 and beyond.
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1. Augmented Reality (AR)
The near future of the digital customer experience in retail is tightly connected with augmented reality, and here’s the thing. One of the biggest problems that online stores have always faced is the fact that their customers cannot try on clothes and accessories or adequately imagine how furniture will look in their house prior to making a purchase.
Virtual and augmented reality technologies can address this issue by significantly expanding the shopping experience. With AR solutions, consumers can see how goods will look in real life: whether a dress fits a body type, whether a sofa matches the wallpaper in the living room, how much space a table occupies in the kitchen, and so on.
Only 1% of retailers provide AR or VR shopping opportunities at the moment, but the situation will quickly change. Merchants understand that augmented reality is the new way to compete: 40% of consumers are ready to pay more for the opportunity to customize products with the help of AR solutions.
Ecommerce augmented reality applications such as virtual dressing rooms or product configurators are gaining popularity. A good example is the 3D & AR-enabled CPQ solution CanvasLogic. This cloud-based platform allows customers to add 3D visualization and real-time configuration capabilities to their eCommerce sites and platforms.
2. Artificial Intelligence (AI)
Many solutions based on artificial intelligence and machine learning algorithms have matured enough to become widely used in online shopping and bring more opportunities for improving customer experience.
Image recognition is among the top AI applications in eCommerce, triggering the development of visual commerce. Here are some examples of how image-analysis solutions can improve shopping experiences:
- Image classification — users can arrange products in an online store by parameters such as color and style, which simplifies the search process.
- Object identification — users can take a photo of an object and find it on various online marketplaces.
- Inappropriate content — users can set parameters for the content they don’t want to see, and the solution will remove it from search results.
Another popular use case of implementing intelligent algorithms in online stores is creating personalized recommendations. AI algorithms analyze customer behavior across all touchpoints (websites, social media, digital signage, marketplaces, mobile apps, etc.) and generate tailored offerings.
Retailers leverage smart analytics, which also takes its roots in artificial intelligence, to analyze and improve marketing campaigns, plan inventory management and support the seamless supply chain.
3. Voice Commerce
A subset of eCommerce, voice commerce is evolving with the development of AI-based voice recognition technology. Online shoppers find it more convenient to use their voice instead of typing out requests for internet searching, ordering, and completing the buying process.
Virtual digital assistants such as Google Assistant, Siri or Alexa help smoothly integrate the online shopping experience with everyday life: users can purchase something without stopping their routine tasks.
Ecommerce companies definitely need to implement and optimize voice search functions in their online store websites and mobile applications.
A chatbot is an incredibly useful marketing tool used to improve customer service. Benefits of chatbots for businesses include continuous work 24/7, cost-efficiency and the automation of routine tasks, which results in a better customer experience.
More and more eCommerce businesses develop their chatbots on the basis of natural language processing technologies so that these programs can interact with online buyers just like human sales assistants.
Retail is among the leading industries to adopt chatbots. According to Juniper Research, over 70% of chatbots will be retail-based by 2023.
Traditional one-size-fits-all ads and mailing that offer random products don’t work anymore — a personal touch is currently the basis of everything in retail.
Modern online shoppers value a more personalized approach that provides help in finding what they really need, not what the retailers want to sell. According to Accenture, the overwhelming majority of consumers (91%) choose to purchase from companies that offer personalized recommendations.
How can you know the current needs of your clients? With the development of AI-powered search and recommendation technologies, you can track and analyze online customer interactions and previous orders, thus identifying their interests and preferences quite accurately.
Retail businesses prioritize on-site personalization because customer retention and, consequently, the growth of eCommerce sales directly depends on the interaction with customers through relevant content, personalized offerings and discounts.
6. Big Data Analytics
Collecting and analyzing large sets of data (big data) open up numerous opportunities for companies in various industries. In eCommerce, big data analytics is the main resource for the creation of personalized experiences, the importance of which we’ve discussed above.
Today, retailers pay more attention to developing a strategy for personal data collection in order to reveal the behavior patterns of their customers and make valuable predictions. In addition to personal information, retailers leverage large amounts of insights on the supply chain, inventory, warehouses and delivery services that contribute to decision-making and result in enhanced revenues. That’s why big data analytics is among the top trends in eCommerce today.
7. Mobile Shopping
The availability of smartphones and the omnipresence of the internet are the core factors influencing the growing number of mobile internet users.
Mobile shopping is growing especially fast, as people use their handheld devices to search for goods, compare prices in various stores, and seek out detailed descriptions, reviews and testimonials. Moreover, with the development of mobile technologies, mobile payments have become more reliable, so it’s safer and more convenient to make purchases than ever before.
Statista forecasts that 73% of sales in electronic commerce will be on mobile devices by the end of 2021.
As a result, all eCommerce websites should be optimized for mobile use. There are two ways this can be done:
- Adaptive design — create a mobile version of a website with simplified navigation, fewer buttons and the most useful information about products. It will look good on smaller smartphone screens.
- Mobile application development — create a separate software solution that users will download to their mobile devices. As a rule, mobile applications provide more opportunities to both clients and companies.
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8. More Payment Options
Variable payment methods in eCommerce stores provide a competitive edge because customers are not limited in their actions and can choose how to pay depending on personal conditions. Thus, they are less likely to abandon the cart.
What payment options can you propose?
- Cards. Debit and credit cards are the most popular payment methods nowadays. It should be noted that contactless cards have become important during the pandemic: they are based on RFID or NFC technologies, meaning that a buyer applies a card to the terminal without contacting it and doesn’t have to hand it to the courier/cashier.
- Bank transfers. When paying for online purchases, it’s obligatory to use internet banking. Online bank transfers are the most secure method of payment in terms of both data protection (due to authentication and encryption of transactions) and infection prevention (due to the complete elimination of human interactions).
- Cash. Though cashless payments are becoming more popular for many reasons, cash should still be a payment option. Some reasons are that elderly people are more comfortable with cash, or that a card terminal may not work because of a bad internet connection in distant regions, or that bank operations may sometimes fail because of server issues. In such situations, cash is always useful.
- Mobile payments. Mobile phones have become a convenient payment tool. Customers set up payment software on their devices and, to make a payment, they just need to hold the device close to the NFC-enabled payments terminal.
- eWallets. Digital wallets or eWallets are an upcoming and convenient payment method for eCommerce. Users create eWallet accounts, connect them to their bank accounts and can transfer money to the dedicated merchant accounts via electronic gadgets.
- Cryptocurrencies. Cryptocurrency payment methods are still disputable, but they might take off in the near future.
Note: If you enable your consumers to save their payment information in personal accounts, it will simplify the next checkout.
9. Omnichannel Sales and Marketing Approach
To attract customer attention in a huge daily flow of news, advertisements and notifications, retailers should deliver relevant offerings and satisfy the needs of their clients here and now. An omnichannel sales and marketing strategy is the best way to do so.
The omnichannel model of trading implies that a client has a variety of options for where to order, how to pay, and how to pick up goods. In other words, a retailer integrates purchase channels such as a website, a mobile application, social media, digital catalogs, and offline stores into a cohesive ecosystem, and provides the same conditions (price, discounts, inventory, delivery, etc.) for each channel.
Omnichannel doesn’t mean multiple separate touchpoints; omnichannel is about multiple integrated touchpoints that track user behavior and exchange information with the aim of improving customer experience.
10. Headless Commerce
Headless commerce platforms are a reasonable solution for large enterprise-level retailers who distribute their products via multiple channels: websites, mobile apps, PoS systems, interactive kiosks, etc.
In a nutshell, headless commerce means that the backend (where product content is stored and managed) is not connected to the frontend or a certain presentation layer. This is a single system with integrated sales and marketing tools that allows online stores to easily create unified content and spread it to many devices via APIs.
Large eCommerce companies are widely adopting SAP C/4HANA solutions that ensure the flexibility of headless commerce and provide enhanced control over the content.
11. Video Commerce
Video content is more appealing to online shoppers than any other type of information. The desire to buy a product is 64–85% higher when users watch a video demonstrating its functions and benefits.
The trend to create videos to promote eCommerce products has transformed into a video commerce branch. Even short pieces of video content help retailers increase customer engagement and conversion rates: a 20-second video can explain a product’s functioning and application better than any image or text can do, convincing consumers to make a quicker purchase.
Consider adding video content to your online store website.
12. Subscription-Based Commerce
An eCommerce business model based on subscriptions is gaining popularity among retailers and consumers. The essence is that providers offer various subscription plans for their products or services, customers choose packages according to their needs and preferences, and get them regularly for regular (e.g. monthly) payment. It’s just the same as a magazine subscription.
Why are subscriptions popular?
- This is a convenient purchasing model for consumers who need the same products or services on a regular basis and don’t want to waste time ordering them every time. For products, people can subscribe to weekly food boxes with basic items they prefer eating. For services, these can be subscriptions to regular analytics reports, entertainment content, etc.
- For eCommerce businesses, subscriptions provide a unique opportunity to predict sales and plan the inventory, thus reducing expenses.
Subscriptions add flexibility and convenience to the everyday life of sellers and buyers, and that’s why they will continue trending.
13. International Ecommerce
In today’s world, everything is accessible like never before, and modern commerce goes across borders. You can order goods and services from various countries and pay for them in a few clicks. This proves that global or international commerce is on the rise.
To remain competitive, online retailers should not limit their consumers by the borders of one country. Instead, they should leverage opportunities to deliver products across countries.
The task is challenging as retailers are required to provide international payment options, multilingual customer support, expended delivery services and more. Nevertheless, it’s worth the cost.
14. Existing Customer Retention Prioritized
Acquiring new customers is a costly and long-lasting process with uncertain results. That’s why it’s more reasonable to spend money on retaining your existing clients, who, if satisfied with your services, will be your word-of-mouth marketing and will help you attract new customers (and do so for free).
All the trends we’ve discussed in this guide, from content personalization and variable payment options to subscriptions, aim to increase customer satisfaction and make commerce processes as seamless as possible.
If you develop your commerce strategy with regard to current trends, you will have no shortage of customers.
To Sum Up
The eCommerce competition is always on the move. Trends may come and go, but in order to compete in the ever-changing online retail space, eCommerce companies need to pay attention to them and choose the most relevant solutions for their audiences.
Note: something that works for one business will not necessarily work for you.
It is important to apply the most appropriate innovations and adapt them to the needs of your audience. Competition in online retail will continue to grow, and only the strongest companies that will offer customers the most advantageous and convenient opportunities will benefit.
The only trend that all companies must follow nowadays is to take a customer-oriented approach.
What are the top eCommerce app development trends for 2021?
- the integration of chatbots with an app
- voice search
- mobile payments
- customization capabilities
- the usage of advanced technologies such as AI, ML, blockchain, AR and 5G.
What are the best upcoming trends in eCommerce?
What new technologies are emerging in eCommerce?
- Augmented reality and virtual reality are the basis for product configurator solutions.
- IoT is applied to monitor shipped goods, optimize inventory and improve marketing campaigns.
- Blockchain ensures the security of transactions.
- Cryptocurrencies and eWallets increase the number of payment options.