Retail trends are constantly evolving, and never was that more true in 2020. The pandemic caused consumer buying habits to shift drastically, and experts predict much of what we saw last year will continue into 2021.
If you’re selling on Amazon or another eMarketplace it’s important to stay up to date with what consumers want, as well as the latest technologies that will help you grow your business.
With that said, here are eight important trends to watch out for in 2021.
Increased online shopping
With more people choosing to stay at home, and many countries locked down for significant periods of time, there was a massive increase in the number of online purchases last year. A recent survey found that e-commerce sales went up six to ten percentage points across multiple shopping categories.
While vaccines are on the way and we hope things will mostly return to normal by the end of the year, this trend is expected to persist through 2021. Many people are still being cautious and don’t want to take unnecessary risks by visiting busy stores.
So, if you’re thinking about starting an e-commerce business now is definitely a good time. For those wondering where to sell, Amazon is likely the place to get started. The company saw its sales grow by 32.8% during the third quarter of last year and shows no sign of slowing down.
More shopping on mobile
This trend has been occurring for a while so it’s no surprise that it’s once again at the forefront. Mobile devices are now the preferred way for people to access the internet, and the same thing is happening with online shopping.
According to Business Insider, mobile sales comprised over a quarter of all e-commerce sales. They estimate that increased to 45% in 2020, and it’s expected to continue rising over the next few years.
What this means is that it won’t be long before the majority of online purchases happen on a smartphone or tablet. While studies show that conversions are generally lower on these devices, the sheer volume can’t be ignored by sellers.
For those operating e-commerce businesses, it’s more important than ever to ensure that your store is optimized for mobile devices. Otherwise, you could be losing customers to your competitors.
AI is becoming more prevalent in our society, and that includes e-commerce. While you may not have noticed it, the world’s largest retailers are utilizing this technology to provide a better experience for their customers.
Some of the ways AI is being used in e-commerce include:
- Product recommendations
- Chatbots (more on this later)
- Predicting customer behaviour
Perhaps one of the best examples of AI in e-commerce is Amazon’s Alexa. According to CTA, one in four shoppers used voice assistants, like Alexa, for their holiday shopping in 2017.
AI use is on the rise, so if possible sellers should look at ways to incorporate this technology into their own business.
It used to be that product prices changed monthly or quarterly. Companies would review their sales figures every so often and make the occasional changes to prices based on that data. However, this way of doing things is out of date.
In the digital age, trends and consumer habits change week-to-week, or even day-to-day. Sellers need to be able to adapt quickly in order to maximize their sales.
This is why many businesses are moving towards dynamic pricing, which allows prices to be changed automatically based on shifting supply and demand metrics.
Some of the benefits of dynamic pricing include:
- Always having the optimal price based on the market.
- Reducing your prices at the right time.
- Reducing your prices by exactly the right amount.
- Increasing your prices when the market calls for it.
- Price changes are done automatically for you.
This strategy is a big reason why Amazon is beating the competition. The company reportedly changes its prices every 10 minutes based on shopping patterns and competitor prices.
Luckily, you don’t need to be a retail giant to take advantage of this strategy. There are plenty of products available to help individual sellers automatically reprice their inventory based on a number of factors.
Messaging and chat apps
It wasn’t long ago that when someone had an issue with a product or service they picked up the phone and called the company. But for younger generations who have grown up with texting and social media, using online chat if often preferable.
Businesses have actually seen a number of benefits when offering chat options as part of their customer service. This includes more flexible communication, better ticket handling, and reduced costs.
Most e-commerce companies have implemented a chat feature on their website. But this isn’t the only way to offer this type of service. A number of businesses are now interacting with customers through messaging apps such as Facebook Messenger, WhatsApp, Telegram, and WeChat, or participating in conversations on social media platforms like Twitter and Instagram.
In 2021, most consumers expect to be able to communicate with businesses via chat, so make sure this is an option for your e-commerce business.
Continuing with the topic of messaging, companies are further reducing their costs by utilizing automated chatbots.
While most consumers will agree that they’d prefer to speak to a real person, chatbots do offer some advantages:
- They save money.
- They reduce labour.
- They can be used to help facilitate sales.
eBay was one of the first e-commerce companies to adopt chatbots as part of their business model. Their ShopBot helps customers find products via text and voice. Users can even take a picture of an item they’re interested in and the ShopBot will search the site to see if it’s available on eBay.
This isn’t to say that chatbots can completely replace people. As with any technology, they’re not perfect and businesses need to have people standing by to take care of anything the bot can’t. Generally, chatbots are best utilized for simple tasks like answering common questions or booking appointments.
Amazon’s growing fulfillment capabilities
For years now, Amazon has been working to gain more control over their order fulfilment, and that really paid off in 2020.
Major carriers like FedEx and UPS, as well as many postal services, faced significant challenges last year. An increase in online shopping meant a big jump in the number of packages being delivered. This lead to restrictions on delivery services and significant delays.
This isn’t to say that Amazon’s logistics were perfect. There were certain delays and they experienced their fair share of issues, but not to the extent of the other carriers. And during all of this, they were able to increase their fulfillment capacity by 50%.
This goes to show that the retail giant is just as much a logistics company as they are an e-commerce business.
What does this mean for sellers? Well, if you’re looking for the best way to fulfil your orders in 2021 it might be Amazon. By utilizing the Fulfillment by Amazon (FBA) program you can take advantage of their massive logistics system and deliver your products quickly and more efficiently.
Amazon ads will be more important
Five or ten years ago, sellers could drive traffic to their listings simply by using the right keywords and having good reviews. However, with the company focusing more on ads this is no longer the case.
The top Amazon search results are now all sponsored ads, meaning if you want more visibility you’ll have to pay for it. The numbers back this up. Ads accounted for just 16% of sales in 2017, but in 2018 that increased to 25%. You can expect that number to continue rising as time goes on.
This doesn’t mean you should completely abandon SEO and reputation management. However, those strategies need to be done in conjunction with advertising if you want to achieve the best results possible.
So, in order to succeed on Amazon in 2021 you should start investing more in ads. This includes both increasing your budget and spending more time optimizing your campaigns.
These are just a few of the trends we’re anticipating for 2021. Keep your eyes on the e-commerce industry and watch out for any patterns that may impact your business. The more information and data you have the more prepared you’ll be when new trends emerge.e-commerce marketing