The ecommerce fulfillment experts at ShipHero on the top trends for 2019

The e-commerce industry has experienced unprecedented growth over the past decade and it shows no signs of slowing down. Research shows that e-commerce could account for $4.88 trillion in global retail revenue in 2021. But what factors are driving this change?

Today we’re going to be taking a look at the 2019 e-commerce trends that account for this massive growth and how you can utilize them for the benefit of your own business.
Let’s dig in…

1. Customer service is becoming more automated.

An e-commerce business can live or die by its customer service strategy, and advancing technology continues to provide new ways to engage with and meet the needs of your customers. Chatbots, for example, are a new trend that enhance the customer experience with minimal cost when compared to traditional customer service teams.

If you’re unfamiliar, chatbots are live chat services that run via an algorithm. Think of it as a “if the customer says X, the chatbot says Y”. Statistics show that the majority of consumers find the greatest benefit of chatbots to be 24-service. While these automated chat services are still in their infancy, they still give e-commerce businesses the ability to scale certain aspects of their customer service department.

If you’re interested in integrating a chatbot into your store, there are hundreds of different services and chatbot use strategies, based on your e-commerce platform, to fit your needs.

2. Direct-to-Consumer models are on the rise.

Consumers want to receive their orders quickly, correctly, and at the best price possible. A tactic many e-commerce companies are starting to use is direct-to-consumer sales. This model eliminates middlemen such as wholesalers and retailers while building a closer relationship with the customer.

Studies show that 52% of consumers will go directly to a businesses website in order to purchase their products. Why? Much of the reason comes down to the relationship that businesses are able to create selling direct. All channels — from marketing to shipping — are consistent under the umbrella of the brand itself. Businesses in all industries are taking notice of the direct-to-consumer rise. Tesla cut out car dealers in order to sell direct to their customers, Nike is predicted to grow their direct sales to $16 billion in 2020 and, remarkably, 61% of wine sales in 2017 came from direct-to-consumer sales.

To succeed in direct-to-consumer sales you need a top-notch ecommerce fulfillment partner. ShipHero can help.

3. Voice-enabled technology will become the new battleground for e-commerce.

According to new research, over 35 million Americans used a voice-activated device at least once a month in 2017 – this number represents a nearly 130% increase over 2016. Smart home assistants and voice recognition systems are on the rise for various aspects of home automation, and 2019 will see a rise in the use of these systems for e-commerce. E-commerce giant Amazon is betting heavily on it. According to an Amazon press release, customers use of Alexa for shopping more than tripled this year compared to last year. The reasoning behind its growth is simple — consumers are looking to technology as a way of gaining back their time. Rather than having to click around in search of an item you’re out of, you can simply request it from Alexa in seconds. The algorithm will scour your past purchases to make a relevant product suggestion and after you confirm, the order is placed.

4. Analytics will continue to advance.

Integrated technology and analytics platforms such as Google Analytics provide e-commerce businesses with valuable data about the performance of their customer base, sales, and products. However, current analytics is almost exclusively used to show what has happened in the past and not what could happen in the future. The relatively new field of Predictive Analytics provides e-commerce businesses with a deeper understanding of customer habits and preferences by analyzing past data and using it to help increase conversion rates. The best current representation of predictive analytics in action would be the rise in product recommendation sections on e-commerce sites. These products are not random. More often than not, they are unique to the visitor based on viewing habits, past purchases, and more. As technology advances further, machine learning will allow for even greater predictability and e-commerce personalization.

5. Amazon will continue to dominate the e-commerce market.

Over the years, Amazon has become an e-commerce powerhouse. In 2018 they dominated the industry with record profits and often hover around the most valuable company in the world. In 2019, it is likely that Amazon will continue to dominate the market, which leaves smaller companies with just one option – to find new ways to remain competitive.

The goal is not to compete directly with Amazon but find ways to integrate it into your e-commerce model by using their marketplace for your own products or fill in the gaps that Amazon has. One of the best ways you can do this is by building a remarkable brand on your own platform. Amazon, while widely used, doesn’t have the ability to offer a fully cohesive brand because they sell products from other vendors. Think of it as the difference between your local grocery store and Trader Joe’s — which has a greater brand appeal? By selling your products direct, as mentioned above, you have the ability to create a more consistent brand experience, which allows for a stronger relationship between your business and the customer.

6. The middleman will slowly disappear.

Each year, the supply chain for e-commerce businesses grow shorter. This no better visualized than in the meteoric rise of B2B marketplace, Alibaba. Today, all you need is an idea and some cash (or credit) to turn it into a reality. Don’t have access to investment capital? You can still bring your idea to market with sites like Kickstarter and Indiegogo. The middlemen and third-party distribution channels, are starting to fade away as the need for their services becomes obsolete.

7. Mobile payment platforms will become the norm.

Though there are still situations where cash is king, e-commerce platforms will always rely on digital payment platforms. However, the type of digital payment will begin to shift. As mobile traffic accounts for nearly half of global web traffic, it is estimated that global mobile payment revenue will rise from $450 billion in 2015 to over $1 trillion in 2019.

As an e-commerce business, review your analytics to see where your traffic and conversions are coming from. Are you seeing an upward trend in mobile visits? Consider implementing Apple Pay and Android Pay to allow for seamless payment. Remember this: Consumers are more likely to convert when there are less steps to completing a purchase.

8. Subscription services will continue to expand.

Over the past few years, subscription boxes like Dollar Shave Club have become extremely popular. While this realm of e-commerce began with the intention of delivering highly used consumer goods (e.g. meal delivery boxes) they have expanded to include almost every industry imaginable — from coffee to clothing. From 2014 to 2017, the subscription box market has grown by an incredible 890%. This growth is due to two factors. First, businesses are looking for every way possible to increase customer lifetime value by turning products into services. Second, customers are looking to receive highly-used products on a regular basis without having to put extra effort or thought into the purchase.

9. Social media will continue to drive sales.

In recent years, social media has become the number one channel for e-commerce businesses to grow and develop their brand. This, in turn, has led to an increase in sales. According to data from BigCommerce, online stores that have a social presence have 32% more sales on average than stores that don’t. Why is this? It comes down to the ability to build a relatable brand that stays top of mind. Also consider that organic social costs are relatively minor in the world of digital marketing and yet they play the biggest factor in building a relationship with customers.

10. Shoppable posts will become more common.

Social media platforms like Instagram already provide excellent opportunities for brands to convert followers to customers, and we’ll continue to see this as a major trend for 2019. Research shows that 80% of Instagram users already follow at least one business and 60% use Instagram to find new products. Furthermore, 75% of those who use the platform to find new products end up engaging further with the brands they discover. To put this trend to work for your business, upload your product catalog to Facebook. This will allow you to “tag” posts with products that will lead followers (Facebook and Instagram) back to the page on your site where they can make a purchase.

11. Augmented reality will change the way customers shop.

One of the downsides of shopping online versus in a brick-and-mortar store is that you can’t physically try the product before you buy. One way online retailers have started to bypass this hurdle is by incorporating mixed reality technologies into their e-commerce platform. For example, IKEA’s Place app makes it possible for customers to catch an augmented reality-powered glimpse into what the products would look like in their own homes. Though AR and VR technology isn’t a perfect fit for every e-commerce industry, it could help some retailers stand out from their competitors. To best analyze whether your business could benefit from augmented reality, ask yourself the following questions…

• Is there a need to see the product in a certain environment?
• Is there a benefit to the customer seeing or comparing different variations of the product in person?
• Are there details of the product that need to be thoroughly examined prior to purchase?

If you answered “yes” to any of these questions, consider integrating augmented reality into the future of your e-commerce store. With e-commerce giants like Shopify investing in it for their customers, it’s becoming easier than ever to integrate into your own site.

12. International e-commerce will continue to expand eastward.

According to recent research, nearly 4 billion individuals (just over half the world’s population) can now be classified as “middle class”. Of that number, almost 9 in 10 of the next billion middle-class consumers will be Asian. With more money comes more purchasing power. Though expanding into international markets has its fair share of challenges, it does present a gigantic opportunity for some companies.

If you’re considering expanding into international markets, understand how you can properly serve this newly evolving Asian middle class. To put this opportunity into perspective, consider that research shows the middle class markets in China will account for $14.1 trillion and India will account for $12.3 trillion in 2030.

Final Thoughts

In the end, a successful e-commerce business is one that provides a valuable product or service and creates an overall satisfying customer experience (from interacting with the brand to using the product). Don’t feel compelled to utilize all of these trends in the coming year. Rather, review these trends and start to think about the current state of your own business to understand what areas of your supply chain or marketing strategy provide the most potential for growth.