At the height of the COVID-19 pandemic, ecommerce sales underwent astonishing double-digit growth. Since customers couldn’t visit brick-and-mortar stores, brands funneled their money into expanding their digital services instead.
But in the following years, a shadow of doubt has been cast over the future of ecommerce. Growth has slipped back into single digits, and people are returning to physical retail in greater and greater numbers.
So, was this explosion in ecommerce sales just an anomalous blip on the economic timeline? Not even close.
While it’s true that growth is slowing,ecommerce as a percentage of overall retail sales remained at an all-time high of 18.9% across 2021 and 2022. And it’s forecasted to rise to more than 20% by 2027.
As for in-person shopping, pre- and post-pandemic consumer behaviors have merged into a preference for hybrid shopping experiences. 88% of adults feel it’s important for businesses to have both in-store and online purchase options, with 56% preferring to use them equally.54% of consumers also expect to browse online and buy in-store while 53% expect to browse in-store and buy online, making an omnichannel retail strategy essential.
The ongoing strength of ecommerce is perhaps best exemplified by this year’s Black Friday and Cyber Monday performance. In 2022, BFCM totaled $20.43 billion in ecommerce sales. But in 2023, this soared to an estimated $28.8 billion, with $16.4 billion from Black Friday and $12.4 billion on Cyber Monday. This shows that no matter how consumer behaviors continue to evolve, investing in ecommerce is still vital for retail success.
Macro changes in the ecommerce landscape in 2023
Speed, convenience, and flexibility remain key aspects of a profitable ecommerce experience. But even in the last 12 months, there have been some notable changes in the ecommerce landscape that every brand needs to know about.
Mobile shopping is still increasing
Globally,74% of website traffic comes from smartphones, as does 63% of orders. Mobile has cemented itself as a major ecommerce growth driver, and it’s showing no signs of slowing down. Now more than ever, brands that sell online must build their websites with mobile at the forefront of their design philosophy.
Social commerce is set to triple
In 2022, around $992 billion in global sales was spent through social media platforms. This figure is expected to triple by 2026. A consumer report by Jungle Scout revealed that 48% of consumers were willing to buy through TikTok, 52% through Instagram, 58% through Facebook, and 62% through YouTube. Focusing on social platforms – as well as the content marketing that brands can share through them – is therefore an excellent opportunity to increase revenue.
Voice searches influence sales
Voice assistants like Alexa, Siri, Cortana, and Google Assistant have had a significant impact on ecommerce. Estimates by Juniper Research suggest that searches performed using voice assistants will account for $80 billion in sales in 2023. By optimizing their content for these devices, ecommerce brands can also increase their visibility, leads, and conversions.
Upcoming ban on third-party cookies
Google plans to stop using third-party cookies by the end of 2024 due to users’ concerns about online privacy. Since brands will no longer be able to track consumer behavior across the internet, many are placing a greater focus on first-party cookies and opt-in marketing tools. This also means ecommerce brands will need to reevaluate their ad targeting strategies moving forward.
Customers need flexible payment options
Rising inflation and a higher cost of living mean many consumers have less disposable income. As a result, flexible payment options such as Buy Now Pay Later are increasingly necessary. Offering a variety of payment options allows customers to continue purchasing despite economic pressures.
Planning for ecommerce success in 2024
Many of the biggest ecommerce trends from 2023 relate to how customers engage with their preferred brands. The needs of the buyer now strongly outweigh the interests of the vendor. And with so much market choice, your customers are free to go elsewhere if you can’t provide for them.
As we move into 2024, ecommerce brands will need to address how they manage the customer experience. Nurturing individual needs will be just as important as providing for their material needs, if not more so. With that in mind, here are the main ecommerce trends and predictions you need to know to plan for success in the coming year.
Ecommerce trends and predictions for 2024
Consumers expect a personal experience
Customers share a great deal of personal information with the brands in their lives. With all that data in your hands, it should come as no surprise that 54% of consumers expect companies to anticipate their needs.
Performance data from Klaviyo also shows that personalized messages perform 40% better than non-personalized messages. So by tailoring the customer experience, you can satisfy consumer expectations and increase your profitability at the same time.
You can further personalize your customer journeys by:
- Using a customer relationship management (CRM) platform to create individual customer profiles that track preferences and activities
- Using AI to inform product recommendations and streamline site searches
- Address emails to specific recipients and tailor your content to suit their shopping habits
- Displaying recently viewed items on a user’s dashboard and making recommendations based on their search and order histories
- Developing marketing campaigns that users trigger through their behavior
Consumers want to connect with brands
Along with personalization,customers also expect an authentic connection with the brands they choose to buy from.
But what does a “connection with a brand” actually mean? The answer is different from person to person. Depending on the customer, this can mean:
- They trust the brand (66%)
- The brand aligns with their values (53%)
- The brand understands them and their wants (51%)
- They depend on that brand’s products or services (50%)
Although the definition of a brand relationship can change, effective methods for developing it seem consistent. 70% of consumers feel more connected when a brand’s CEO is active on social media. And 72% feel similarly when employees share information about a brand online.
In other words, establishing a strong, consistent, and above all genuine social media presence across your organization can encourage positive brand-consumer relationships. This must be a key focus for all ecommerce companies moving into 2024.
Speed of purchasing is a deciding factor
The vast majority of consumers report that convenience is a priority in online shopping. Anything that interrupts that convenience can seriously impact the profitability of your ecommerce site.
17% of shoppers have abandoned their cart because the checkout process was too long or complicated. And 24% have done so because the site wanted them to create an account.
To further streamline the digital shopping experience, many ecommerce brands are cutting down their checkout process. Shopify has rolled out its one-page checkout, which improves conversions by around 7.5%. And Amazon – which accounts for almost 40% of the US ecommerce market – is well-known for its one-click “Buy Now” option.
As shoppers come to expect lightning-fast transactions as standard, platforms that don’t offer this service will most likely lose customers to their more convenient competitors.
Product proof points add even more value
Greater scrutiny over brand relationships and purchasing experiences will lead to more fierce competition between competitors trying to stand out among the crowd. That means you’ll need to place a greater emphasis on the benefits of your brand and products.
One way to win over potential customers is through the use of product proof points. These are examples that provide evidence of your greatest qualities. By demonstrating your value rather than simply claiming it, you can win customers who might otherwise remain on the fence.
Popular ecommerce proof points that improve shopper engagement include:
- Testimonials: Authentic, voluntary endorsement from happy customers is one of the best ways to encourage a sale. Feature these prominently on your website and make product-specific praise easy to find on your sales pages
- User-generated content: Similar to testimonials, product content made by your own customers is a reliable source of information for those looking to buy
- Case studies: These real-world success stories offer a deep dive into how you and your products benefit purchasers. They offer specific data and allow users to visualize their own future experiences
- Video demonstrations: Some products are hard to explain. But video demonstrations give browsers a first-hand look at your products in action
- Before/after photos: Presenting a clear point of comparison empowers you audience to imagine the positive impact your products can have on their life
- How-to guides: As well as showing how your products work, taking them time to provide supplementary resources shows customers that you’re genuinely interested in their satisfaction
- Awards and accolades: These mark you out as an industry leader, giving new customers confidence in your ability to meet their needs
- Guarantees and warranties: By removing the risk from your purchases, you ensure customers have no excuse not to experience your products for themselves
Rethink your approach to targeting
Although the death of third-party tracking can make targeting much harder, first-party data still lets you track customers through their digital journey. That means you can automatically adjust your online store and communications to enhance the shopping experience. You can also use first-party data capabilities like Customer Match and PAIR to continue personalizing ad targeting based on customer data.
To supplement this, it will be more important than even to onboard customers through voluntary data capture and social platforms. Offering valuable resources or benefits will allow you to attract highly qualified leads while also laying the foundations for an ongoing relationship.
Your takeaway for ecommerce in 2024
The COVID-19 pandemic didn’t simply spark growth in the ecommerce space. It fundamentally changed the expectations and attitudes consumers have about buying online. Adapting your digital service to better satisfy customer needs will allow you to remain relevant and profitable as we enter 2024.
For some, this will mean reevaluating how they engage and build relationships with their target audience. For others, it’ll involve streamlining options and features to create a seamless buying experience. Take the time to establish where your ecommerce business is currently lagging and develop a thoughtful plan for addressing the concerns that hold you back.
