E-commerce is no longer a rising tide for all categories and brands. Online retail sales growth is coming down from pandemic-driven highs. Euromonitor International expects online product sales to record single-digit growth over each of the next five years. This rate is far lower than the more than 30% peak in 2020.
Retailers and brands need to become savvier when searching for the next opportunity, though. The online channel is reaching a new level of maturity, especially in more developed e-commerce markets where penetration rates for specific categories may hit a ceiling. As such, retailers and brands are deploying new tactics to reach and engage consumers. And that gives way to three e-commerce trends.
E-Customisation
Brands are putting the “custom” into “customer”. A greater desire for personalisation means offering a broader range of tailored options across online purchases. In fact, 47% of digital consumers expected better personalisation in exchange for their personal information, according to Euromonitor’s latest Voice of the Consumer: Digital Survey. Technologies like AI make it easier for brands to customise products on demand or enhance the level of individual shopping experiences.
Starbucks is a prime example of a company that has found success embracing customisation. The coffeehouse giant offers more than 170,000 customisation options on its app and noted in an earnings report that this initiative was “the single biggest driver” of increased spend per customer in history. Quick-service operators across North America and Europe are taking a page from Starbucks’ strategy to enhance the level of choices or selections offered through their own apps.
Game Changers
Online companies are tapping into gaming to drive growth. Low conversion rates plague e-commerce, with shoppers abandoning purchases due to shipping, payment or tech hurdles. Three quarters of digital consumers abandoned an online purchase last year, according to Euromonitor’s Voice of the Consumer: Digital Survey. The top reason? An unexpected shipping cost.
