It’s hard to remember a world in which Amazon was best known for selling online books. In 2018, the e-commerce giant generated over $141 billion in revenue from the sales of beauty products, clothing, electronics, toys, games, food, and more.
Amazon’s domination of the e-commerce space illustrates that the way consumers shop is evolving. Today, they expect faster shipping, multiple purchasing channels and a steady stream of social media interaction with their favorite brands.
As FabFitFun’s Ryan Waymire said, “The experience should be richer than shopping at a mall with friends and family.”
But what will consumers expect tomorrow? We talked to three e-commerce experts with experience in warehousing and logistics, video gaming and fashion. They broke down the e-commerce trends they see shaping their industries in 2020.
Vice President of Merchandising Ryan Waymire said, “Consumers will reap huge benefits as their e-commerce experiences become more personalized, immersive and convenient.” This is a trend that FabFitFun already utilizes to speak directly to users’ needs and wants, he said.
Personalization
“Consumers are continuing to seek more personalized shopping experiences,” Waymire said. “With Amazon providing an “everything” store for commodities, consumers are now looking to retailers and brands to renew their sense of discovery and surprise and to recommend products best-suited to them. Time-starved consumers want retailers to simplify the shopping experience by providing personalized shopping, e-mails, and content that speaks directly to their needs and wants. Retailers must use data, trends, and merchant “gut” to elevate their personalized shopping experiences, provide more meaningful products and content, and simplify the shopping experience.”
Consumers expect commerce and content to be blended seamlessly.”
Enhanced Delivery Options
“Retailers continue to raise the bar and consumer expectations on shipping,” Waymire said. “Consumers expect enhanced delivery options through increased shipping speeds and alternative fulfillment methods like “pick up in store.” The expectation is that e-commerce is more convenient and efficient than shopping in physical stores. Retailers must continue to invest in logistics, fulfillment and operations to continue to elevate the delivery experience for consumers.”
Content is Commerce
“E-commerce is no longer about just selling stuff. Consumers expect commerce and content to be blended seamlessly,” Waymire said. “Retailers must move from the “what” of products and brands to the “why.” Consumers want to know why products, ingredients, materials, trends and brands are right for them. Retailers must continue to find ways to tell richer, more 360-degree stories and consistently tell those stories throughout the e-commerce customer journey.”
“Community Consumers”
“This community can be as simple as reviews or a loyalty program or as comprehensive as a full-fledged social media or social shopping platform,” said Waymire. “E-commerce is no longer a solitary activity. The experience should be richer than shopping at a mall with friends and family. Retailers must continue to elevate the social aspect of e-commerce to provide consumers with the ability to interact with each other, brands, and retailers.”
“We’ve seen that players want to get involved, have a bigger stake and be closer to the games they love,” says Mythical Games Vice President of Marketplace Services Rudy Koch. “We believe that by building economies that are inclusive of the game entrepreneur, pro players, content creators, and all gamers, we can allow for new and interesting revenue opportunities.”
Monetization from Streaming Platforms
“We’ve seen some remarkable shifts in the games industry over the last several years: Streaming on Twitch and YouTube quickly became multi-billion dollar fixtures,” said Koch. “Today, it is not only a career for many, but also a business where e-commerce plays a significant role in allowing streamers to monetize, thus creating a new category of entrepreneurs.”
eSports Fans as Consumers
“More recently, eSports gained incredible momentum becoming its own multi-billion dollar vertical within games,” said Koch. “This spawned a new opportunity that allowed fans to support their favorite teams by buying merchandise and memorabilia, while allowing pro gamers and teams to turn themselves into sustainable businesses, which will further the development and growth of the eSports world.”
E-commerce plays a significant role in allowing streamers to monetize.”
Free-to-Play Gaming
“Over the last 10 years, we’ve seen games continue to merge with major paradigms like e-commerce and SaaS,” said Koch. “In the past, the games industry was dominated by the retail model. Gamers would go to their local store to pick up a copy of their favorite game, and that was usually the end of it. Today, some of the most popular games in the world are free-to-play. Instead of selling them at retail, game developers rely on complex and flourishing item-based, in-game economies and digital distribution systems. Embracing the evolution of e-commerce has allowed for record-breaking revenue for the games industry and will continue to be the trend.”
Grey Markets
“Grey (and black) markets have been a major part of the games industry for decades,” Koch said. “They were fringe and illegitimate but they were generating billions globally. Unfortunately, grey markets were seen as a thorn in the industry because they take revenue away from developers and break the game experience for the honest gamers. Significant resources were committed to squashing them over the years, but with the advent of free-to-play and item-based economies, they’ve only grown in orders of magnitude.
“At Mythical, we see grey markets as a massive opportunity to grow in-game economies for players,” he said. “The simple fact is that these illegitimate markets have only been growing with the games industry, which shows that the demand is clearly there.”
Ben Eachus, CEO of Flowspace, said the future for consumers will be equal parts instantaneous and flexible.
“They will be able to get what they want, at a speed they desire, at a venue they prefer and on terms that are suitable for them,” Eachus said. “Organizations will need flexibility and reliability in their supply chain at scale, powered by real-time intelligence that is insightful on where demand is rising and how to modify their supply chain.”
Fulfillment Centers Are Table-Stakes
“Amazon Prime has fundamentally changed the customer expectations on delivery speeds. Receiving products in two days is quickly becoming table stakes for any e-commerce brand or retailer,” said Eachus. “This has a direct impact on the number of warehouses and fulfillment centers these companies need. For example, enabling two-day delivery requires three fulfillment centers across the country, while one-day delivery requires staging inventory in more than 11 fulfillment centers. Flowspace enables any brand to have a national fulfillment footprint all on a single software platform in a matter of days.”
“For every $100 spent online, $20 will go into fulfillment and logistics,” he added. “To effectively compete, brands need to shorten the distance their products travel to customers through optimal inventory placement and fulfillment strategy.”
Omnichannel Everything
“Customers today expect the flexibility to purchase products online across multiple platforms and across multiple in-person formats (pop-up stores, company owned retail locations or big box stores)” said Eachus. “This omnichannel requirement is putting pressure on supply chains and fulfillment strategies to change rapidly, as brands need to support all of these channels seamlessly.”
Customers today expect the flexibility to purchase products online across multiple platforms.”
Full-Service Commerce Platforms
“The next big evolution of e-commerce will be propelled by social media platforms,” said Eachus. “Companies like Instagram, WhatsApp and Pinterest will not just be content and product discovery platforms, but also evolve into full-service commerce platforms where consumers can find, engage and purchase products directly from brands without leaving the social apps.”
