5 E-Commerce Trends to Watch Out For in 2021
Predicting trends always has a dose of speculation. No matter how much data and evidence you have when trying to predict how a market will react in the near future, you can never accommodate events like the pandemic that’s taking place all around the globe. With that in mind, what we will attempt to do is try and make some informed observations about the e-commerce industry for the rest of the year as well as 2021. Let’s dive right into it.
The E-Commerce Trend is Here to Stay
The sudden shift to online shopping is directly linked to the pandemic and the quarantine measures that come with it. People are forced to stay indoors and as a result, shopping online becomes the only viable option. Whilst that is true, make no mistake that this reality is not a fluke, but here to stay. This pandemic has been nothing but a big case study in favour of e-commerce, showcasing its ability to deliver. Comfort, ease, convenience and practicality were all e-commerce attributes that were known to the public before the pandemic but putting them through this stress-test only helped them shine and make a noticeable impact. According to a MarketWatch article, penetration rates, which are currently at 15%, are expected to reach 25% by 2025. The pandemic simply kick-started the e-commerce era. In April alone, average daily sales were 39% higher than March’s averages.
People won’t need any more convincing to do their shopping online. This seems like a long-term change and merchants should be building their e-commerce strategy in 2-5 year spurts, instead of trying to instinctively react to what’s happening as a trend that will only last for a couple of months.
Social Media Will Evolve
The role of social media has been evolving since the day they came into existence. They started off as an online communication channel, transitioned into a branding exercise for companies to later become a funnel taking consumers to a company’s website. 2021 seems to be the year that social media will take the next step in their maturation journey, by becoming pure e-commerce platforms.
According to eMarketer, “More than 55% of Gen Z US internet users—who do half of their fashion shopping online—said their most recent fashion purchases were inspired by social media browsing.” Couple that with Instagram’s newest checkout feature, and the latest introduction of Facebook and Instagram shops, and you’ll clearly see the trend unfolding in front of your very eyes. Social media won’t be about likes and follows anymore, but about sales and conversions.
Companies will have to rethink their approach to social media as they are no longer just a place for rich visual content, but a straight up sales channel.
Artificial Intelligence Will Take Center Stage
Let’s start with a few facts. According to a PwC research report, AI has the power to change everything about the business world and could contribute up to $15.7 trillion to the global economy by 2030. A recent IBM’s study reveals that the adoption of AI-driven intelligent automation in retail and consumer product industries is expected to double, going from 40% to 80% within the next 3 years. A Juniper research paper came out at the beginning of last year with data showcasing retailer spending on AI would grow nearly fourfold, reaching $7.3 Billion by 2022.
Everywhere you look, the signs are the same, AI will be a cornerstone in the development of e-commerce in the years to come. What does AI look like for e-commerce merchants? AI could come in the form of tools ranging from automated marketing platforms to chatbots that respond to customers in real time. Other areas where AI can change the game for merchants include optimized pricing and discounting, as well as forecasting demand. The personalization of marketing campaigns from harnessing the data acquired through AI will give merchants tools that they never had at their disposal. The ability to know when to approach customers, what product to showcase and at what price-point.
Augmented Reality Becomes Part of The Experience
According to an A to Z research paper, “…shopping experiences with the help of user’s location and android applications for smartphones such as virtual changing room and adoption of AR technique will help users to visualize products realistically from any remote location.” If the language isn’t clear, we’ll break it down for you. Augmented reality can help customers be in a store, without having to physically be in the store. It solves the single, most common argument against e-commerce: the ability to see the product in person before buying it.
An interesting infographic by Invesp reveals that 61% of online shoppers prefer to make purchases on sites that employ augmented reality tech. A further 63% say augmented reality drastically improves the shopping experience for them. It is evidently clear that augmented reality is the future of e-commerce, and the merchants that invest in it will have a lot to gain from it.
A Variety of Payment Methods
According to a European Parliament briefing and a Paypers, Payment Methods report, According to a 2019 industry report, “Online payment methods in Europe vary according to local preferences: in the UK, for instance, credit and debit cards are the two most popular payment options, with PayPal coming third. Germans like to pay with PayPal and with open invoices, 2 while the French like to use the Carte bleu debit card. In the Benelux, iDeal (the Netherlands) and Bancontact (Belgium) are very popular.”
What’s the main takeaway from this insight? Payment methods come in different shapes and forms according to the location, culture and history of a specific market. E-commerce businesses should be doing their research and putting together an online payments plan to accommodate the regions they want to target. We are moving towards a cashless economy but that doesn’t come without its own payment challenges. Merchants have to possess a robust, trustworthy, agile payment infrastructure going forward as they will be asked to process a lot more volume of transactions.
Only time will tell if these trends will pan out as predicted. What we can guarantee is that here at BigWPay, we will be keeping a close eye for them and even if they don’t, we will be prepared to deal with whatever the future holds. Our technology allows us to be agile enough to react to the unpredictable. Crisis or no crisis, trend or not trend, BigWPay is your trusted payments partners.