How E-Commerce Companies Can Overcome Current Challenges (Podcast 107)
With complicated factors like inflation and supply chain delays coming into play, retail faces new challenges. While new challenges arise, the retail sector also looks to innovate and improve, adapting the current climate and facing these challenges head on. E-commerce giants like Amazon, continue to dominate, as Pyments.com reveals that Amazon’s share of US e-Commerce sales hit an all time high of 56.7% in 2021. These findings defy the logic that says it gets harder to grow a large business, having doubled its share of the domestic retail piece to 56.7% in 2021 from 28.1% in 2014. If you’re looking to scale your business or improve your customers’ experience, you’ll need to be aware of the current trends in E-Commerce.
Here are 5 Top e-Commerce trends:
E–commerce platforms will have to compete for screen time with streaming services like YouTube, and social media platforms. Apps with the infinite scroll feature like TikTok have provided users with the thrill of swiping through engaging video. The idea of providing a service and a meaningful experience for the customer is more important than ever. Live stream shopping events have shown that there’s a huge market for discovery, and that brands definitely have a role to play in it.
- Supply Chain Issues:
The delays in the supply chain are felt across the world. Retailers are facing reduced earnings before interest, taxes and depreciation. With some factories shutting down due to geopolitical issues, health risks and manufacturing labour violations. In addition, ocean freights have increased in price, and the surge of re-commerce stock has caused added pressure at the distribution centres. Then the often complicated logistics of last mile deliveries, it’s evident that the global supply chain may never be the same.
Moving operations and labour in-shore could be a solution, but it would require initial investments to front the costs, inevitably eating into profit margins.
- Social selling:
As the average person spends around 2.5hrs on social media everyday, social selling has become even more attractive to brands. Not only can social selling provide more specific targeting for your ideal customers, but it can also increase the likelihood of purchase: 55% of consumers who participate in M-commerce made a purchase after seeing a product on social media. User generated content will bring a dose of reality to advertising and awareness. Magazine quality sheen will be replaced with homemade and on the street.
- BNPL vs Credit cards:
Instead of increasing their credit card debt (and interest fees), customers are increasingly turning to Buy Now Pay Later services. This trend is particularly true of millennial and Gen-Z buyers looking to keep up with their peers. But as these services have started reporting to credit agencies, it remains to be seen if this trend will continue.
- Omnichannel targeting:
Making the most of every possible customer interaction to make a difference and help increase conversions. Retailers now favour using an omni-channel approach to target their customers, and according to McKinsey, 60-70% of consumers are now shopping in an omnichannel way. The Omnichannel Retail Index launched in 2015, consisted of categories like the online experience, marketing, in-store experience, and fulfilment. Through detailed and extensive mystery-shopping by FitForCommerce consultants, the Index examines how 100 retailers perform against 250+ criteria across web, mobile, and in-store.
According to the Omnichannel Retail Index, this year, new features and functions have reached a 95% adoption rate among retailers and brands in the Index. These include; using auto-suggest to anticipate customers needs when typing in the search box, offering filtered searching, showcasing multiple product images and the range of available colours on product detail pages, basket dropout campaigns and lastly, maintaining customers addresses on their own online account.
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