The year ahead could be a very interesting one for the digital commerce landscape. E-commerce agency Absolunet detailed 10 trends it believes will shift the world of online shopping in its 10 E-Commerce Trends 2019 report.
Here’s what to look out for as 2018 bleeds into a new calendar year.
Nothing is certain, but …
That’s right: the taxman is coming for e-tailers in 2019. In the wake of South Dakota vs. Wayfair Inc., many states have already begun siphoning off sales tax in compliance with 5-4 Supreme Court ruling. Previously, online businesses had to have a physical presence in a state in order to be taxed. Now those that sell anywhere in the U.S. are subject to sales tax, regardless of their physical footprint. That means higher costs for consumers, 36 percent of whom claim they’ll trim their online shopping as a result, the report said. Most retailers aren’t thrilled about the changes; 69 percent think the tax will have a negative effect on their business.
The year of social commerce?
Instagram’s rumored to be building a standalone app dedicated to shopping; Snapchat cemented its status as sneaker-drop central and opened a Thanksgiving Shop and Cop; Facebook hopes its video efforts are monetizable and, maybe, the next version of QVC-style home shopping. After years of rumblings, dashed hopes and premature excitement, technology might finally be catching up to where social commerce wants to be. Social’s fertile ground for selling; 40 percent of merchants already wield their presence on platforms like Instagram, Facebook and Snapchat to drum up sales in some way, shape or form. Nearly one-third (30 percent) of consumers are interested in purchasing directly through social sites, rather than dealing with the patchwork of hurdles necessary to complete a transaction today, despite efforts by Instagram, for example, to make posts more easily shoppable.
Mobile gets progressive
We already know the golden age of apps is on a steep decline, but progressive web apps (PWAs) are here to “reinvent and reinvigorate mobile shopping,” Magento senior director of strategy Petre Sheldon told Diginomica back in April. Not just a browser experience nor a full-fledged native app, PWAs are said to be the best of both worlds: all of the great features in an app and the web without any of the pesky drawbacks. Why are PWAs the next big thing? Because the average person downloads precisely zero apps each month, the report said.
PWAs just might spur more conversion on smartphones, which continue to lag desktop. People using West Elm’s progressive web app spent 15 percent more time on site, and per-visit revenue ticked up 9 percent, according to the Absolunet report.
The era of no- or low-cost returns might be drawing to a close in e-commerce. They’re a notorious drag on profit margins, said 44 percent of retailers, and people return online purchases at two to four times the rate they do in brick-and-mortar, the report noted.
That’s why e-tailers are desperate to turn this ship around. Amazon, famous for its generous returns policy, might be to blame for ushering in the end of no-sweat returns, as it claimed it would ban any “serial abusers” caught taking advantage of its laissez faire policy—or committing outright fraud. Sixty-one percent of merchants said that with the right technology in place to track patterns in returns, they’d give habitual returners the boot, too.
Startups like Happy Returns are trying to solve the online returns problem and turn it into a value add. What’s more, Shopify acquired Returns Magic to offer better post-purchase customer service, further signaling the growing importance of this space.
Retail intelligence goes artificial
If you think artificial intelligence (AI) is already here, get ready to see even more of it in 2019. Why? Because on their own, people can do only so much. Asian e-commerce power players like Alibaba’s Taobao and Tmall online platforms already use an AI copywriting tool to help vendors write up to 200,000 words every second about the wares they’re hawking online.
Already, today’s retailers carry as much as 10 times as many SKUs as you’d find on their websites a decade ago, and that growth will only accelerate in the years ahead as millions more consumers come online. To keep up with this demand for more photos, videos and other details, retailers need solutions automated through AI that can manage mundane but necessary product information tasks, freeing them to merchandise to their heart’s content.
Catering to the conscious consumer
People have values and beliefs and ethics and social consciousness and ecological concerns—and they’re not going to let you forget about it. Values-driven shoppers are paying more attention than ever to how you’re doing business. Is your product packaged appropriately or did you send a massive cardboard box for a tiny T-shirt? Are you doing anything to offset carbon emissions?
Perhaps emboldened by values-first customers who, for example, boycotted retailers that sold Ivanka Trump’s now-defunct line of apparel, accessories and footwear, brands like Nike have taken prominent stands by using social justice warrior and former NFL star Colin Kaepernick for a high-profile ad campaign. For its part, outdoor favorite Patagonia created the Action Works website to help people find causes they care about.
It’s no longer enough to just sell stuff — people are looking to shop with companies they can feel good about.
Marketplaces to the max
Name a marketplace: Amazon? Walmart? eBay? Based on industry trends, household-name marketplace platforms are set to grow considerably in 2019. Though just 12 percent of major merchants run a marketplace at this moment, another 32 percent are thinking about getting in on the action, perhaps because 86 percent don’t want to give up owning the customer relationship and the transaction. In Canada Best Buy branched out from its electronics roots to add categories like furniture, baby products, jewelry and more, effectively doubling its SKU count.
QR codes come back to life
Maybe we’re late to the party here in the U.S., but China long ago capitalized on the power of the quick response (QR) code, using it for mobile payments virtually everywhere. Here, the QR suffered from limited usability because people had to open a dedicated QR scanner app to access the information contained in a code. Finally, Apple and Google have built QR code reading capability into their operating systems, meaning that most smartphones running the latest version of Android and iOS can automatically recognize a code and prompt the user to view it.
For brands and retailers, this feature upgrade unlocks a whole new world of possibility, restoring the humble QR code to a central role in how people access product info.
This could flip the script on showrooming, the scenario in which people browse products in a physical store while researching them online through their smart device. If a retailer makes rich product info available through a QR code, they could better control the customer experience and give shoppers a reason to complete the purchase in-store. The report cited Deloitte research noting that 48 percent will check our products in store before buying them online.
Can’t keep up with digital retail’s insatiable appetite for content? Good news: Content syndication is poised to become the new normal. Syndicating content ensures consistent product information is sent to every channel, avoiding the possibility of confusing mistakes from one channel to the next.
“Brands and manufacturers syndicate their content to increase brand awareness, product information consistency, SEO and conversions,” the report said.
Time to go car shopping
That is, shopping while inside a car. Already, 77 percent of people who hop online when they’re commuting behind the wheel engage in some form of commerce, according to the report. With tighter mobile-vehicle integration, that number would climb to 83 percent. In-car commerce can help to expose your brand to potential customers at a moment when they’re primed for discovery and open to ideas.
Editor’s Note: This story was reported by FN’s sister magazine Sourcing Journal. For more, visit Sourcingjournal.com.