The holiday season is well under way! As all those orders head out the door, many minds in ecommerce start to look at what’s ahead in the new year. It has been another year of twists, turns, developments, and growth. The last few years certainly have not been calm and quiet in the world of online business.
This year we’ve seen continuing supply chain issues, growth in brick-and-mortar commerce, rising costs and inflation, and more. And yet, the outlook for ecommerce has never looked brighter. Understanding the trends that will emerge in 2023 is the key to ensuring your store remains successful and growing.
We’ve narrowed it down to just 5 trends that we believe will shape customer experience and how they engage with ecommerce brands in the months ahead.
#1 - Customers will expect better omnichannel experiences
Before the pandemic, omnichannel was a big trend in ecommerce. Of course, with everything from nationwide lockdowns to a slowed down supply chain, one key channel fell significantly - in-person retail. For those merchants with online and physical stores, this was a big blow. However it did herald in a huge period of growth for ecommerce, and so more merchants focussed on those omnichannel experiences just without brick-and-mortar playing a big role.
Fast forward to 2022, and brick-and-mortar is not only back but outpacing ecommerce growth leading to swathes of lay-offs in the industry. The fear was that everything would return to that pre-pandemic balance between online and offline. While the growth in ecommerce has slowed down, there’s one thing that’s changed from 2019. Customers now not only fully understand the benefits of ecommerce, they also understand how it plays into the other channels they engage with including brick-and-mortar retail.
So, we’re returning to that omnichannel trend but with a much more informed customer base with higher expectations.
That means in 2023, it’s time to not only integrate all your channels, but to find new ways to use omnichannel strategically to enhance the overall customer experience. For example:
- Offering in-person delivery and collection options on your online store
- Allowing in-store customers to return online
- Using email and SMS to target local customers with information and promotions in your physical store
- Making better use of local SEO and local business tools online, such as Google Business Profile
#2 - They’ll also expect more from their post-purchase experience
Following along similar lines of high customer expectations, they’re also going to want more from their post-purchase experience. This has been a growing expectation due to severe supply chain issues which started in late 2021. As they’ve carried into 2022, customers are now more aware than ever of the impact the supply chain can have on their online shopping experience. The more issues they face here, the more they’ll move back towards brick-and-mortar which is a problem for online-only, DTC businesses.
The biggest issue customers face in post-purchase is around shipping and delivery. 45% of consumers in one survey said they would not recommend a brand due to late deliveries. In the same survey, 48% of customers said poor delivery experiences would cause them to stop shopping with a brand. On the other hand, 72% said they’d increase their spending with a brand that provided positive delivery experiences, and 82% would share those experiences with relatives and friends.
The reward then is clear, and essential to growth. One area which is easy for merchants to build on is around order communication. 85% of customers want proactive communication from brands about their orders. This can be achieved through automated email workflows, and more robust, self-service tracking tools. 67% of customers prefer self-service options, so by adding these to your post-purchase experience you’ll give them exactly what they want.
#3 - Younger generations will continue to enter the market and shake it up
Every year, more young people enter the market for ecommerce. Especially in the last year or so, we’ve started to see the real impact of how these younger generations interact with the internet and engage with brands. This then influences customer experience - what matters to these customers? Where do they discover brands? How do they engage with ecommerce?
This year, we’ve seen how Gen Z have influenced one of the biggest, long-held channels for discovery - search engines. An executive at Google revealed research that indicated some 40% of Gen Z use platforms like TikTok as part of their discovery journey. They’re also dispelling commonly held ecommerce beliefs, for example the importance of free shipping. In fact, they’re the most likely generation to spend more for a more expedited shipping option. They’re also more willing than any other generation to shop directly with brands, over marketplaces or third party sources.
This trend will only continue, and in 2023 could be one of the biggest influences in shaping the future of ecommerce. To adapt, merchants need to start exploring new channels, and figure out what matters most to their younger customers.
#4 - Social media will influence how brands engage with customers
Another after-effect of the pandemic is the rise in engagement with social media and by extension virtual reality. Much the same way people couldn’t physically go to stores, they also couldn’t physically interact with brands or even their friends and family. This caused a shift to a closer relationship with the digital space - social media, virtual reality, the metaverse, video calling etc. Despite a return to brick-and-mortar, people are still highly engaged in online spaces and communities.
This has inevitably changed how customers then discover new products and engage with brands. Social commerce isn’t a new concept, and over the past few years ecommerce platforms like Shopify have formed closer links with platforms like Spotify, YouTube and TikTok. This also ties into the growth in younger generations coming online, as they’re more likely to discover new brands more frequently and on social media. The influence here is that they’re more likely to be consuming visually rich content such as video reviews from like-minded peers. And they’ll engage with their peers in a more community focussed way through comments and videos.
So, how can merchants make the most of this trend? By getting on those platforms! Creating content, engaging through comments, viewing and commenting on other creators’ content, and by having a social storefront. Visibility is key, and the more visible you are on these platforms, the better. You’re creating content that’s valuable, interesting, and close to what your target audience already wants to consume.
Plus, we’re seeing a return to the micro-influencer strategy whereby you approach those with smaller, more niche audiences to help with promotions. Engaging these creators may prove to be a valuable approach in the coming months.
#5 - Customers will be most loyal to brands that offer enhanced personalization
Customers these days have more choice online than ever before. And the more choice, the more selective they are around where they spend their hard-earned money. Why waste time on brands that offer a generic customer experience? Especially if there are competitor brands which offer a highly tailored experience before, during, and after purchase every time.
Personalization has long been a growing trend in ecommerce. However, with more customers returning to brick-and-mortar stores, ecommerce brands will have to offer something more than just convenience or product availability. This may have been enough in the days of lockdowns and in-store supply chain issues, but in the year ahead brands have to offer something unique that brick-and-mortar stores can’t. That USP will be a personalized experience.
According to McKinsey, 76% of consumers are more likely to purchase from brands that offer personalized experience, and 78% are likely to recommend those brands to friends and family. The majority of consumers also expect brands to understand their wants and needs, so it’s no longer a “nice to have” for retailers.
But the brands that will succeed in 2023 with personalization efforts, are those who balance this with growing concerns around privacy. Last year, we wrote that data privacy would lead CX in 2022, and this will continue into 2023. As we edge closer to Google getting rid of third party cookies, it matters now more than ever to make better use of first and zero party data. Doing so will ensure a much more tailored experience for each individual customer, that also respects their data privacy elsewhere online.
Every year, merchants are faced with new challenges but they’re also presented with many new opportunities. Reflecting on the year just passed, and understanding what may shape the future of ecommerce will allow you to take advantage of what’s going to matter to your customers in the year ahead.