It’s interesting to recall the exponential growth of the e-commerce industry as it re-assures its brighter future in the upcoming decade. Even if the market share is still small, the e-commerce industry has interestingly witnessed a steady growth rate over the years.
The way e-commerce is slowly and steadily taking over the market at the expense of traditional channels is complex, as well as surprising. Although the overall percentage of e-commerce retail sales is small at around 10% of sales in the US and 18% in the UK, the sustained growth over the years is worth applauding. The latest growth forecast of the e-commerce industry from eMarketers suggests that the e-commerce industry will see a 16% increase in sales in 2020.
Below are a few e-commerce trends that will define this growth rate in 2020:
Personalization and targeted marketing
Personalization is a critical component of any e-commerce retailers’ site success. The entire game depends on how smartly firms leverage customer data to tailor their product offerings and content based on behaviors, interests, and past purchases of customers. The whole e-commerce industry is currently going through digital transformation to use big data to solidify its relationship with buyers.
Visual commerce to strike up impulsive buying decisions
Visuals play a much more significant role in the future as newer capabilities related to the e-commerce industry emerge. This means it is essential to tie up well-produced content representing products with user-generated content, 3D renderings, social links, and other AI tools. This will be fueled by the adoption of 5G networks in the future, enabling the movement of more massive amounts of data and visual information on e-commerce websites. This is crucial as visuals strike the impulses best.
Prioritizing customer trust and data privacy
Although consumers demand personalization, they still prioritize privacy. In 2020, retailers need to balance hyper-personalization with consumer data protection to build consumer trust. With GDPR, CCPA, and other consumer privacy regulations coming in, data privacy will be the most critical consideration in the future. E-commerce as an industry faces a lot of customer interaction giving them access to customer data and preference, so data privacy is the biggest concern and needs to be prioritized.
Embedding IoT into e-commerce
In 2020, will the digital evolution will speed up; there will be a proliferation of sales options on a multitude of emerging touchpoints for online retailers. With the rise of the API, e-commerce merchants will be able to leverage new constellations of touchpoints to connect with consumers based on what they are inclined to buy. Purchases through cars, voice devices, appliances, and more will become increasingly viable in 2020.
Unified commerce and seamless payment gateways
Today’s shoppers expect seamless payments through all avenues of an Omnichannel experience with a retailer. To provide exceptional customer experience and to prevent consumers from bouncing out of the website, e-commerce retailers need to ensure a seamless, safe, and unified payment system.
Enterprise marketplace and its vertical growth
With the wide range of products in hyper-specific categories and the network of specialized buyers as well as vendors, the retailers have delivered value-added services. These services are becoming more and more enticing for buyers. In 2020, therefore, B2B e-commerce vendors need to focus on value-added strategies to differentiate themselves by positioning their products closer to competitors to lead the related marketplaces.
Adopting a subscription-based business models
In 2020, retailers will need to be careful when selecting a subscription business model. The idea of receiving guaranteed monthly revenue is enticing, but customers are becoming increasingly aware that subscriptions might impact their finances. It’s critical that e-commerce brands consider the needs of their target audience, and analyze whether they can genuinely justify a monthly subscription plan.
The growing popularity of API based commerce
The progressive web apps (PWAs) are one of the most exciting trends that e-commerce websites are enabling. PWAs provide optimized user experience for mobile and offer the same features as native apps, including lightning speed. This is important and instrumental in closing the mobile conversion gap in 2020. Retailers struggling for freedom over their tech stack should move towards PWA in 2020.
Addressing customer data using data analytics tools
Retailers have a massive amount of data at their disposal. The point of sale system (POS) data still remains a totally untapped opportunity for merchants to access insights into customer demographics or preferences. In 2020, the industry will see a massive shift from merely reporting what happened to utilize predictive analytics to inform campaigns and driving future product strategies. But, most importantly, firms need to be cautious when dealing with private customer information.
Increasing the dependency on Artificial Intelligence
Online retail firms operate on a macro scale, and thus, they have always been intimidated by the idea of using AI. In reality, it’s already embedded in most of the existing e-commerce technologies. In 2020, many retailers will decode the value of AI and the relative simplicity of leveraging AI-powered solutions. Selecting the right technology stack will be instrumental in harnessing the power of artificial intelligence and machine learning to increase productivity by discovering patterns in behavioral data.