It is often foolish to try and predict the future. Winston Churchill once stated, “It is better to prophesy after an event has occurred than it is to prophesy beforehand.”

However, we can still make educated predictions of ecommerce by gathering data and identifying trends and patterns. Let’s begin by looking at some shifts in consumer behavior which will drive the ecommerce industry over the next few years.

Millennials and Generation Z: The Future’s Purchasing Power

The generation of Millennials born between 1980-1994 is on track to account for more than $1 trillion annually in the United States. But 36% are burdened with large amounts of student debt. This trend is responsible for the rise of ownership and has been a driving force in many modern payment innovations. 

Generation Z is right behind the Millennials. Although the oldest one is only 24 years old, early analyses have already been done. This DazedMedia youth culture report reveals that Gen Z has both hyper-individualism as well as mass trends within one person. We are both fragmented and united at the same moment.”

This is a significant shift from the previous generations, especially Gen X, where individualism was in direct opposition to the mainstream.

A New Normal for Environment

A new shift in consumer behavior, this time one that will affect every generation of current life, is certain to impact the ecommerce industry as a result of COVID-19.

According to Dazed Media’s report, Our homes are our entertainment and offices, and human interaction is decreasing. This is a time of extreme tensions, from fragmented and united, digitally to physical, reality or fantasy, individuality to homogeneity, and even reality to fantasy.

Ten Trends that Will Shape the Future of Ecommerce

These trends all point to the following main goals:

• Reduce friction in the buying and selling journey

• Creating rich brand experiences

• Sell anywhere, everywhere

The future of ecommerce is all about increasing convenience for merchants and shoppers, creating rich and compelling shopping experiences, and enabling seamless, customer-friendly experiences across channels.

1. As markets outside the United States adopt online shopping, global ecommerce is growing.

Globally, the ecommerce share in retail sales has been increasing for at least five years. This trend is expected to continue.

According to McKinsey data and COVID-19, Net consumer optimism in many countries has dropped. The pandemic, however, has forced a greater use of ecommerce, particularly for essential items.

This presents a huge opportunity for expanding cross-border sales to countries where e-commerce penetration has been slow.

Brands will need to research whether international expansion is right and appropriate for their online business. Here are some things to keep in mind:

• Is there a demand for my product/category in this market?

• Will my marketing translate across cultures? Or will the brand have to invest in unique campaigns?

• Is it necessary to localize an ecommerce website for international customers?

• What payment options are the most popular in the country?

• What is the best way to approach cross-border shipping

Consider all the costs of marketing, selling, and shipping internationally so you can assess whether it will be worth it for your brand to leverage global e-commerce opportunities. It is important to remember that selling to mobile-first countries like APAC, Africa and the Middle East will require a mobile shopping experience that is easy to use.

2. Automation is a key to productivity and growth.

Automation aims to automate a task as efficiently as possible. This could be anything, from automating tasks with Zapier, scheduling emails in a CRM, marketing tool, or email marketing system, to leveraging advanced technology for hiring.

However, the two most talked about topics in future ecommerce trends are robotics and machine-learning.

Funding is an indicator of future trends. This one is a winner. Within the past few months, an open-source conversational AI platform for chatbots and voice applications received its fourth round of funding. An autonomous forklift designer also raised $15 million.

Robotics.

Already, robotic devices, drones, and other autonomous vehicles can be used to enhance the supply chain, for example, to locate, identify and transport goods in warehouses. The U.S. is getting closer to fully autonomous freight cars being on the roads.

Machine learning.

Combining machine learning/ AI with big data can automate more than just automating — it can optimize many processes that are currently too time-consuming or impossible to do.

It’s expected to increase ecommerce personalization, which can help customers have a better shopping experience.

Jeff Goffinet, Dunn Solutions Group said that websites that suggest items you might like are using machine learning to analyze past purchases.

Machine learning is used by retailers to collect data, analyze it and then use it to personalize shopping experiences, create marketing campaigns, optimize prices, plan merchandise supply plans, and gather customer insights.

Through touchpoints, this data analysis and capture can help you identify fraudulent orders or other high-risk orders placed through your online store.

Goffinet says that machine learning will become less dependent on data scientists over time for everyday ecommerce applications. To reap the benefits of machine learning, you need to identify your greatest pain points. If you are tired of dealing with customer support issues, you can implement a chatbot.

Start small, and it will grow with your business. Remember that automation is about making it easier for people to do their jobs. It’s nothing more than a shiny object.

3. Automated commerce will be possible with voice commerce and headless technology

In a January 2019 survey, 45% of Millennials said they had used voice technology like Amazon’s Alexa or Google Home to shop. This trend will only increase as users become more comfortable using voice-assisted technology like smart speakers.

Although it’s a big leap to think we might order new apparel or home decor, it’s easier to see a use for reordering. For example, “Alexa, please put dog food in your shopping cart.”

In this instance, Amazon remembers your brand and quantity preferences, making it easy to reorder.

This technology’s future is based on voice commerce and the growth in subscriptions to reach automated eCommerce (commerce) as well as headless, commerce-powered Internet of Things devices.

Brands that have products that are compatible with this model, such as consumer packaged goods (for example), should be the ones to think about.

Voice search and SEO.

Consider the way that people search. Think about how people search.

SEOs need to be aware of this trend to determine how it may impact best practices and page rankings.

4. PWAs increase mobile commerce — and more

Progressive Web Apps make use of the most recent web technology to provide an online experience closer to a native application than a standard web page, especially when used on a mobile device.

They are gaining popularity due to their reliability, lightning-fast speeds, and engagement capabilities such as sending push notifications or appearing on the device’s home screen just like an application.

Mobile shopping isn’t a new phenomenon. Smartphone sales are expected to increase significantly to reach over $432 Billion in 2022.

You can also add the number of mobile-first consumers in international locations such as the Asia Pacific region, Africa, and the Middle East to your potential buyers.

A PWA can be used in conjunction with a headless commerce structure to provide the necessary control to ensure a reliable and fast mobile shopping experience. The commerce engine is separated from the store’s front end, giving marketers and developers two places to play. This reduces the chance of unexpected changes and gives customers a native app experience.

Brand insight.

“We’re using a flexible approach for managing content that… lets the marketing and content team build rich informational pages that can be fully integrated with other parts of the site,” stated Corey Ward, a senior developer who worked with Canvas 18.39. They launched their store using a PWA, headless commerce, several months ago. This allows for faster development and easier updates for marketers and developers.

He said, “Shopping experiences don’t fit all.” We use a headless approach to make decisions based on the context of what type of experience we want to create.

5. Customer experience is a driving force for development.

As COVID-19 pushes us further towards a digital-first universe, brands will need to work harder to offer compelling, rich shopping experiences that keep their customers’ attention in a crowded ecommerce marketplace.

Brands are constantly looking for new ways to innovate, as the technology to create unique experiences is becoming easier. How can you provide the best experience for your customers?

Video, 3D, and Augmented Reality.

Video is a great way to get shoppers involved in the ecommerce experience and the brand. A compelling video can spark emotion and engagement and give your customers something to do.

Omnichannel experience.

Your digital storefront should not be limited to boundaries. Your brand experience must be consistent across all channels, devices, contexts, and platforms — even your online store.

Contrast Agency founder Elliott Davidson sees a lot of potential in figuring out how to provide the “in-person and white-glove customer service that customers have grown to expect in retail” for ecommerce sites.

One of our clients offers FaceTime calls that allow customers to ask as many questions as they wish about the product. This is a great example of a retail business going further. Davison said that high-ticket sales require a customized service to understand the customer’s requirements and needs.

Start looking at how headless commerce can help your brand improve its customer experience.

6. Offline experiences look different — even after COVID-19.

COVID-19 is not only keeping us from offline experiences that cannot be done alone, but it has also helped accelerate changes that are already in the works.

BOPIS, BORIS, and curbside

Texas Grocer H-EB had an online ordering and curbside pickup option before the pandemic. This allowed them to be ahead of the curve when consumers suddenly needed low-touch service.

Andrew Lipsman, the principal analyst at eMarketer, was quoted as saying that there is a shift of power towards digital. “The problem is that this paradigm shift is so profound it disrupts the status quo, and creates new winners or losers,” Lipsman said.

Existing mix-and-match experiences such as buy online, pick-up in-store (BOPIS), or buy-online and return-instore (BORIS), have been proven to be profitable. Salesforce discovered that brick-and-mortar retailers that offer BOPIS in their brick-and-mortar stores saw a 27% increase in digital revenue, compared to the 13% growth for those that didn’t.

These fulfillment options will be available to stores that have not yet implemented them. Many will choose curbside pickup or BOPIS to minimize contact since there is still some time before vaccines become available.

Touchless tech.

While we are all at home, touchless tech continues to improve. Mobile payment options are now common. In what was either great timing or really lucky timing Amazon announced that it would begin selling its automated checkout “Just walk out” technology to retailers in March.

Brand insight.

This makes shopping for furniture, paint, and plants a fun experience. The showroom allows customers to place orders directly with Burrow and the other featured retailers. Burrow also has a showroom located in Soho that showcases its products. They were joined by an online paint retailer and an online plant seller.

Stephen Kuhl, co-founder and CEO of Burrow, was quoted as saying that “being able to create physical places where people can test the product before they buy is important.”

7. Online checkout and payments become more personal, opening up the market for a new consumer segment.

You’ll find a new payment option every time you look. As the younger generation becomes more tech-savvy, more payment options are available. TransUnion’s study showed that Millennials are using credit cards less.

Many e-commerce sites now offer low- or no-interest financing options, such as Klarna, Afterpay, and Affirm. This allows shoppers to make large purchases while not having to pay a lot of money upfront.

Brands will need to accept as many payment options as possible to reach more people, especially the under-40 crowd.

These BNPLs do not finance shoppers with poor credit scores. Katapult is here to help. Let’s suppose a retailer offers Klarna but denies the shopper due to credit score. Katapult is an option offered by the retailer. The shopper will automatically be given the option of financing through Katapult, at a higher interest rate that is based on risk.

Jeremiah Griffin, Director of Business Development at Katapult, says that people used to be divided according to their credit scores into subprime and prime. Businesses can now reach new markets with emerging lease-to-own payment options like Katapult.

Merchants can offer personalized services. Merchants have many options for payment, which allows them to reach new markets and give customers more choices.

8. Data collection and analysis become more coherent and complete.

Many traditional CPG brands that sell through major retailers felt too distant from the users of their products. They can sell DTC to get to know their customers and collect data to help them make smarter decisions about retention, targeting, and other matters.

Businesses that want to increase ecommerce sales will find data increasingly important in the years ahead.

Elliott Davidson, founder and CEO of UK digital agency Contrast said that “In the future, we will see more ecommerce companies leverage data from an internal perspective.”

“In-house marketers can make more strategic business decisions, and dig into the data to find out what’s working. Businesses will need to analyze data to make future ecommerce decisions.

Brand insight.

Sowers stated that instead of looking at customer segmentation traditionally, “we’ll be able to look at customers down-funnel and identify those with the greatest lifetime value, then optimize marketing with these in mind.” Hannah Sowers, the founder of Union of Elements, brings 11 years of experience from Amazon. She believes that marketers will be better equipped to communicate their message to the people most likely to act by combining lifecycle marketing and data science.

“Then we can use the same data to find other customers who look similar to them, ideally predicting more accurately which customers will end up in the high-LTV category.”

9. Ecommerce for B2B is becoming a common expectation.

B2B – even large industrial brands – is now undergoing its own real-time digital transformation. This has been propelled by COVID-19. It’s also likely to have long-term benefits.

Digital Commerce Pete Robertshaw, Space48, said that “In the past three to four months we’ve seen how vulnerable B2B businesses can be.” Even those that are already online don’t have the optimal digital journey they require yet.

Robertshaw suggests that B2B examine its online presence more closely and gain a better understanding of their customers.

“Some B2Bs think they understand their customers, but when it is time to optimize their digital journey, they don’t. CX and UX are not only important for B2C, but they are also equally important for B2B. Buyers expect seamless shopping experiences.

We’ll see more innovation as more B2B companies move online. This includes content marketing and development, communication with customers, and how they tell their brand story online.

Aviv Baron, founder of Direct Payment Group predicts that B2B may offer more payment options to increase efficiency for buyers and seller.

Baron stated, “We are building a universal invoice system that will allow sellers to offer payment options such as credit card, check, and ACH.”

Businesses will have greater visibility into the payments they receive with this system.

“We already see some B2Bs offering installment payment options, and I believe that this trend will continue.”

Brand insight.

Resmed is a global company that sells cloud-connected devices for the remote monitoring of patients. They only recently went online with their B2B business, but haven’t looked back.

Rajiv Shanmungananthan (ResMed Asia’s customer-facing applications leader), stated that previously all B2B orders had been placed via email or phone calls, and then logged in spreadsheets.

“Overall, we experienced chaos at the end of the month that… was attributed to approximately 54 hours of work per week.”

Their B2B business uses E-Commerce to eliminate chaos at the end of each month, Shanmungananthan stated. It also supports order management.

10. Social selling expands ecommerce beyond the physical storefront.

Ecommerce proved its worth quickly despite concerns that a lack of interaction and social presence would make it less attractive to shoppers than brick-and-mortar. Social media has allowed us to have both (sorta).

It is a well-established part of any brand’s marketing strategy to be present on social media platforms. However, modern advancements have enabled a commerce component to allow for online shopping.

In-app purchases on Instagram and Facebook

Social commerce will grow in importance as Millennials, Gen Z and other generations continue to increase their purchasing power. 47% of respondents are open to social media influencers.

Both Facebook and Instagram made significant progress toward making it easier to purchase without leaving the platform. Last year, Instagram introduced checkout in beta. Facebook Shops was recently launched to make it even easier to sell on the platform.

Pinterest has more to offer.

Pinterest is also jumping on board. Last year, I introduced a visual search tool that suggests fashion and home decor products based on an image’s context. Platform users can see pricing and availability via Rich Pins, including Product Pins. Customers can also buy products from Pinterest using Buyable Pins.

The hiring of an ex-CTO for Walmart, as well as a VP of engineering at eBay, is a clear indication of the platform’s progress.

Wrapping up

You’ve probably felt the need to do 100 things while only being able to do ten if you have an ecommerce shop for any length of time. You must prioritize your future trends relentlessly.

Every trend is not for every brand. B2B businesses selling heavy equipment won’t see an increase in revenue if you use Instagram to check out. Voice search is not the best option if you are selling personalized gift items for very specific occasions.

Prioritize usability over flash. This applies to both the customer’s point of view as they shop and yours as an operations manager. A solid foundation of best practices and processes will be the only thing that can replace flashy onsite experiences. Once you have this down, take calculated risks and test, then test again.