6 Trends Shaping the Future of Ecommerce
The global ecommerce market is expected to reach $6.51 trillion in 2023, according to research compiled by Shopify Plus. By 2025, roughly 23% of all retail sales will come from online purchases, up from 17.8% in 2020.
To compete in this increasingly competitive hybrid marketplace, retailers must do more than sell their products online. They must enable conversational commerce, omnichannel sales, and other ecommerce trends that help their businesses deliver the flexible, convenient, and transparent customer experience that digital shoppers have come to expect.
Like most industries, retail has been in a state of flux since the turn of the century, adapting to one digital disruption after another. Change has been the only constant. Of all the noteworthy ecommerce trends that will matter in 2023 — and beyond — none of them are exactly brand new. But the stakes are higher than ever, and so are consumer expectations.
To meet those expectations, smart retailers will focus on these six trends:
1. Conversational Commerce Is Continually Rising
Consumers aren't just shopping online; they're communicating with retailers online throughout their buying journey. That intersection of conversation and conversion is conversational commerce, and it's a win-win for both customers and brands.
For customers, it's a way to get what 91% of shoppers say they want: immediate, real-time assistance. Meeting that need also pays dividends for retailers, as live chat can improve conversion rates by up to 82%. Conversational commerce is also a way for businesses to streamline customer service, automate parts of the sales process (including checkout), and gather insights that help them more effectively market products to individual customers.
Conversational commerce can take many forms — from getting personalized product recommendations from a chatbot enabled with artificial intelligence (AI), to searching for products via a smart speaker, to live-chatting with an agent about shipping options. Research on ecommerce suggests consumers are ready and willing to do all these things. In fact, 73% of consumers say live chat is their preferred way to communicate with businesses, more than half (52%) use voice assistants to search for products and services, and 1.4 billion currently use chatbots.
2. Omnichannel Shopping Blurs the Lines Between Online and In-Store
Retailers might still think of online and in-store as two distinct shopping experiences, but consumers don't see it that way. Top brands are breaking down those siloes, enabling customers to complete different parts of the purchasing process on different channels. For example, some customers might do their research online and buy in-store, while others want to view products in the store and buy online.
Omnichannel shopping also means letting customers buy online and pick up their orders at the store, buy products online and return them at the store, or make a purchase while at the store but have the items delivered to their homes. Some forward-thinking retailers had already begun to embrace omnichannel shopping before the pandemic, but the "buy online, pick up in-store" (or "click-and-collect") model took off during the pandemic. In fact, click-and-collect sales more than doubled in 2020 and are expected to represent 10% of all sales by 2025. Although more and more shoppers have returned to physical stores, they want to keep shopping this way.
The message to retailers is loud and clear: Customers are charting their own (omnichannel) buying journey, so it's time to remove the roadblocks.
3. Smart Devices Drive Sales
Shoppers will increasingly use their smartphones in 2023 to purchase goods and services, find local businesses, and communicate with retailers. This year, mobile devices are expected to account for roughly 72.9% of all global ecommerce sales.
Shoppers aren't just using their mobile devices more — they're using them differently, relying more heavily on voice assistants to help them find local businesses and fill their online shopping carts. Voice assistance is projected to increase 113% by 2024. Overall, one-third of consumers now use voice search regularly — via mobile devices and smart speakers, which 55% of households owned at the end of 2022.
The takeaway for retail marketers: Search engine optimization matters more than ever, and the more conversational the keywords are, the better.
4. Personalization Takes a Backseat to Privacy
"Personalization" reached buzzword status years ago, and retailers have spent the past decade investing in technologies that let them collect the data they need to deliver the relevant marketing content and tailored shopping experiences that modern consumers have come to expect. But those strategies have been upended by new data privacy laws in Europe, China, Brazil, and California; by Apple's privacy update in iOS 14.5, which prohibits cross-app data sharing without user permission; and by popular internet browsers banning third-party cookies.
Now that brands can't just purchase third-party cookie data, they need new tools and strategies to power personalization. That means incentivizing users to share data with them directly by offering valuable content and being transparent about how they'll use that data.
AI can also help bolster personalization efforts by gathering information about an individual's online searches and shopping habits across company-owned channels. Meanwhile, AI chatbots can provide personalized product recommendations based on information that customers provide to them directly — and then save that data for future personalization and targeted marketing.
5. Augmented Reality Enables Visual Commerce
Seeing is believing, and it can encourage buying. By superimposing computer-generated images onto videos or photos, augmented reality (AR) technology lets customers view products in real-world spaces (so customers can see how a couch will look in their living room) and real-world faces (so they can see how a lipstick shade will look with their skin tone).
Next year, one in three people will use AR to view products virtually, and because this immersive online shopping experience lets them view before they buy, 65% of AR users will be more likely to make a purchase.
6. Shortages Are Here to Stay
The talent and resource shortages that have plagued retailers will continue to be a problem in 2023, along with ongoing supply chain delays and increased shipping costs. This will force retailers to get creative about how they allocate staff and be transparent with customers about what to expect.
The good news is that most shoppers already know supply chains are a mess right now and that retailers can't do much to fix the problem. They don't expect brands to make the system move faster; they just want brands to be honest and communicative.
Chatbots can help keep customers up to date about delivery times and shipping delays and automatically alert people when out-of-stock items are available again. They can also help pick up the slack for understaffed sales and support teams, answering customer questions instantaneously while human workers focus on complex communications and in-person interactions.
4 Ecommerce Predictions for 2023
What will these trends mean for retailers? How will the ecommerce landscape change in the year ahead? Where will brands focus their energy and dollars as they prepare for the future of ecommerce? Let's dive in with four key predictions.
1. Chatbots Will Expand With Conversational Commerce
Retailers will invest in chatbots to further power conversational commerce by providing customer support and personalized product recommendations, taking orders and making reservations, processing transactions, and manning multiple communication channels at once.
Global spending on conversational commerce is expected to grow nearly sevenfold over the next three years, reaching about $290 billion in 2025. Chatbots will account for a big share of that spending, but they are also expected to save retailers roughly $430 million in 2023 alone. Overall, retail sales via conversational channels are projected to grow 98% annually over the next couple of years, reaching $142 billion by 2024.
2. Live Chat and Social Shopping Will Become a Bigger Part of the Mix
The 2022 Vonage Global Customer Engagement Report — a comprehensive survey of 4,638 global consumers — found that consumers are already chatting with brands in large numbers. Currently, 41% of shoppers use WhatsApp to message businesses, 31% use Facebook Messenger, and 26% use Instagram. One-third of consumers chat with brands daily, and 32% plan to message businesses more often over the next year.
Not only will customers be chatting with businesses via social media channels, but they'll also be shopping there in greater numbers than ever before.
3. AI and AR Will Become More Important Than Ever
Data on ecommerce from Grand View Research suggests the global AI retail market, which was worth $5.79 billion in 2021, will grow more than 23.9% from 2022 to 2030. Much of this investment will be in chatbots that fuel the conversational commerce trend.
Meanwhile, the global AR retail market will grow by $9.4 billion from 2022 to 2026, per ReportLinker. This technology will change how brands market their products and fuel ecommerce growth.
4. Retail Workers Will Wear More Hats, Including New Ones
With retail talent in short supply and new and existing workers expecting more compensation to combat inflation, retailers will be automating customer support and sales as much as possible. They'll also be training human workers to help with tasks such as click-and-collect sales and local delivery, as well as new roles such as virtual shopping, appointment shopping, and other jobs that will be important in the future of ecommerce. Many retailers are even tweaking their job descriptions from "information providers" to "experience hosts."
Preparing for the Future of Ecommerce
Most of the key ecommerce trends for 2023 are also conversational commerce trends. That's because conversational commerce is the future. It's also new territory for most brands and an opportunity to get ahead of the crowd and stand out in a hypercompetitive landscape.
Vonage is a one-stop shop for the technology that retailers need to power conversations — including live chat that lets users manage multiple channels from a single dashboard; AI-powered chatbots; and communications APIs that brands can use to enable single-click multichannel communication from any brand-owned online site, including mobile apps and social media sites. With solutions like these in place, retailers can get ahead of the trends in 2023 and prepare for the future of ecommerce.
Learn more about conversational commerce solutions from Vonage.