Three e-commerce trends that will change the way we shop in 2023

Ecommerce is no longer a rising tide for all categories and brands. Online retail sales growth slows from pandemic-related highs. Euromonitor International expects online product sales to post single-digit growth over the next five years. That rate is well below the peak of more than 30% in 2020.

But e-commerce remains a dominant force, accounting for 47% of retail growth through 2027. However, retailers and brands need to get smarter when looking for the next opportunity. The online channel is reaching a new level of maturity, especially in more developed e-commerce markets where penetration rates for certain categories may be capped. As a result, retailers and brands are adopting new tactics to reach and retain consumers. And that leads to three ecommerce trends.

E adjustment

Brands put the “Custom” in “Customer”. A greater desire for personalization means offering a wider range of bespoke options for online purchases. In fact, 47% of digital consumers expect better personalization 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 customize products as needed or improve the level of individual shopping experiences.

Starbucks
SBUX
is a prime example of a company that has found success with personalization. The coffeehouse giant offers more than 170,000 customization options in its app and noted in a results report that this initiative was “the single largest driver” of higher spend per customer in history. Quick Service operators across North America and Europe are aligning with Starbucks’ strategy to enhance the choices offered through their proprietary apps.

game changer

Online businesses are borrowing gaming tactics to fuel growth. Low conversion rates plague ecommerce as buyers abandon purchases due to shipping, payment, or technical hurdles. According to Euromonitor’s Voice of the Consumer: Digital Survey, three quarters of digital consumers abandoned an online purchase in the past year. The main reason? Unexpected shipping costs.

Gamifying commerce, or mimicking techniques from the gaming world to encourage desired behavior, harnesses the power of rewards and competition to inspire app activity. Organizations are also integrating these features to collect valuable first-party data, which tighter privacy restrictions have made more difficult.

Boston-based startup Jebbit offers brands the ability to add quizzes and other interactive elements to websites without technical support. CEO Tom Coburn said Jebbit has seen interest in these features surge over the past 18 months due to changes in regulation and the end of third-party cookies.

Another factor: the pandemic-driven e-commerce boom and the realization that the online experience needs to adapt. “Now that platforms like TikTok are grabbing consumer attention, other platforms are now saying we need to create a fun and engaging experience, too,” Coburn said in an interview at NRF 2023: Retail’s Big Show.

Sensory shopping

Brands are using technology to create multi-sensory customer experiences online to better simulate in-person shopping. Ecommerce stores are transformed with more immersive visual and auditory content. Also, brands are starting to push Web 3.0 by using technology to evoke all senses like touch, smell and taste.

Recent advances have been driven by either the largest, best-resourced companies or innovative start-ups. Beauty and personal care giant L’Oréal, for example, is using novel hearing technology to use sound to convey the impression of smells over the internet. Meanwhile, South Korean beauty company Amorepacific has partnered with MIT to develop a skin meter that allows users to monitor their skin’s response to external stimuli, bringing the sense of touch into the digital age.

2023 could mark a turning point. Consumers are becoming more comfortable with Web 3.0 and brands are better positioned to leverage it for immersive experiences. Beauty and fashion players who capitalize on a consumer’s personal style are likely to see the greatest benefit.

Three trends to help you secure your online growth

Businesses that want to be successful online must proactively target, acquire and convert a new digital consumer. In a November 2022 Euromonitor industry survey, 45% of professionals said providing a positive digital consumer experience is critical to success. More than ever, it is important for businesses to understand digital trends and changes to gain a competitive advantage and better serve customers.