February 5, 2020
Accountable to a generation of consumers that demands excellent experiences across every channel, the eCommerce industry is on the cutting edge of innovation.
Current eCommerce Trends Snapshot
eCommerce growth is still outpacing overall retail growth at 14.1% versus 4%.
2019 online holiday sales reached $138 billion. This figure represents a year-over-year increase of 12.7%.
As a result of the pace of change in eCommerce, the future is not something that many merchants have the luxury of planning for—it’s happening right now, all around us.
So, if the future of eCommerce is already upon us, what can merchants expect over the next 12 months? Magento’s ecosystem partners provided their thoughts on the top eCommerce trends to watch in 2020.
Each of the eCommerce trends falls into one of three distinct categories:
Customer-Driven eCommerce Trends
Technology-Driven eCommerce Trends
Industry-Driven eCommerce Trends
1. Ethical eCommerce Trends
Consumer awareness of the environmental and ethical footprint of their consumption is on the rise. In 2019, we witnessed #climatestrike movements happening all over the world as consumers put pressure on governments and industries to provide sustainable solutions to address CO2 production, plastic packaging, farming practices, waste reduction, and so on.
A recent Nielsen survey found that 81% of people feel strongly that companies should help improve the environment, and a separate study found that 68% of online shoppers deemed product sustainability an important factor in making a purchase. This passion for corporate responsibility is shared across gender lines and generations. Millennials, Gen Z, and Gen X are the most supportive, but their older counterparts aren’t far behind.
Consumer awareness of the environment and ethically produced items will rise as an eCommerce trend in 2020 as consumers will seek to understand the real or hidden impacts and costs of eCommerce and consumerism in general.
2. Seamless Omnichannel Experiences
If merchants look at their omnichannel strategy from only a sales standpoint, they’re missing out on an important eCommerce trend. As the number of touchpoints required to make a decision grows, sales and marketing channels are increasingly complementary, triggering the need for consistent product experiences across the board.
According to PwC, 86% of buyers are willing to pay more for a great customer experience. Merchants with a good understanding of the impact of the various channels in their customer journey can build their product experience accordingly and thrive in the new omnichannel experience economy.
3. Personalization, No Conversion
The future of eCommerce personalization will leverage cognitive solutions to understand where customers are in their journey and to identify different factors and traits to deliver truly individualized experiences.
Basic personalization won’t stand the test of time. If merchants want to deliver relevant, personalized experiences to everyone, the ideal way to do that is with artificial intelligence (AI). These new AI-powered experiences will extend across channels, providing the most relevant encounters based on the context of a customer’s interaction. Merchants will consider not only who, but where, when, and how a customer is engaging with them.
4. Shipping and Delivery Transformation
In 2020, several innovations will continue to shake up the eCommerce delivery business. Shipping companies are constantly looking at more ways to use data to drive innovation, and AI’s potential is endless: Data-driven supply chains could bring previously unimaginable levels of optimization. AI is the future of shipping.
In fact, McKinsey predicts a world where autonomous vehicles deliver 80% of parcels. Self-driving robots, which operate like small lockers, are already being tested and will become an eCommerce trend very soon. In just a few years, there is a good chance that online purchases will arrive at your door with no delivery person.
5. Headless Commerce
Headless architectures and lean microservice stacks deliver improved agility and performance compared to monolithic systems. And the benefits are delivered almost immediately. With the ability to develop apps in parallel, isolating and scaling microservices is possible so new front-end experiences, including Progressive Web Applications (PWAs), can be launched quickly and efficiently.
Historically, if a user experience team validated a change in design that may boost sales considerably, they’d have to sit on that change until a developer could get to it. The net effect is that merchants are slower to grow. When marketing and creatives have the freedom and mobility to implement change, they’re able to conduct tests and experiments more frequently, garnering richer insights, which ultimately lead to higher conversions.
6. Progressive Web Apps (PWAs)
Mobile has been top-of-mind in eCommerce trends for the past few years. PWAs are the next evolution of mobile commerce and will become the standard in 2020.
Through PWAs, customers can interact with brands how they want and where they want in a completely seamless manner. For instance, customers visiting a furniture gallery will have their in-store experience, mobile experience, and online experience all provided by the same PWA for a seamless experience that guides and nurtures consumers from their first visit to the store all the way through the delivery of their new furniture.
As a result of their popularity, the cost of PWAs will decrease, making them more accessible for more merchants.
7. Micro Animations to Boost Conversions
Animations like GIFs have been around since the early days of the Internet, but today their use is expanding from memes and entertainment to become the latest eCommerce trend.
The application of animated icons to the eCommerce experience can emphasize the brand, improve the user experience, and boost conversions.
8. Visual Search in eCommerce
Today’s consumers — especially those between the ages of 18 and 20 and 21 and 34 — have shown a growing interest in using visual search and image recognition in order to discover new brands and products. By 2021, early adopter brands will redesign their websites to support visual search, resulting in a 30% increase in digital commerce revenue and making it one of the biggest eCommerce trends to watch.
In the context of eCommerce personalization, this presents a massive opportunity for brands to foster deeper connections with their shoppers by making it easier for them to find the products they’re looking for.
9. Voice as an eCommerce Channel
While many people say we’re still in the early days of voice, almost three-quarters of people would rather use their voice as an input to search. And recent research shows that 76% of companies have already realized quantifiable benefits from voice and chat.
In fact, this research found that roughly 20% of consumers with intelligent speakers use them to shop, and that’s expected to rise to 50% in the next 12 months as this eCommerce trend takes hold.
10. NextGen B2B eCommerce
Only 14% of B2B companies are customer-centric, and that’s because many don’t try to get inside the mind of the B2B buyer. B2B brands should consider building a direct-to-consumer channel. This would give them ownership of customer data to optimize the customer experience across all channels and steps of the journey.
In 2020, B2B digital transformation will shift from a product-centric to a customer-centric focus. We’ll see B2B organizations explore new opportunities and channels to enhance the customer experience and expand their target audience.
The eCommerce platform revolution will reach a tipping point in 2020, driven by buyers seeking the easy, familiar, and competitively priced marketplace experience. McKinsey predicts that in the next five years, platforms could account for more than 30% of global corporate revenues. And it’s not just B2C. B2B merchants are turning to platforms also.
The top 100 online marketplaces already sell $1.8 trillion each year. The businesses that are taking the lead in this new digital ecosystem-driven economy are seeing nearly double the revenue growth of the companies that play it safe. And while the opportunity is ripe, there isn’t much time left to become a first mover.
The Future Is Here: What Can Merchants Do?
The future is already here. All these eCommerce trends are in various stages of maturity, with some being tested by early adopters and others well on their way to becoming mainstream across the industry.
Our ecosystem partners contributed to a new eBook on eCommerce 2020. It’s packed with details and advice on what lies ahead in 2020 and beyond, and what merchants can do to prepare.
Thanks to our partners for their insights and expert advice: Absolutnet, Akeneo, Algolia, Astound eCommerce, Blue Acorn iCi, Corra, Creatuity, DHL, Kensium Solutions, Mirakl, Narvar, Nosto, and Perficient.
Download the full guide: eCommerce 2020: The Future is Now.