The Future of Ecommerce

What Is the Future of Ecommerce? 10 Insights on the Evolution of an Industry

Coby Nikolaus
July 24, 2020
Total retail sales worldwide, 2017-2023
Private label brands now account for approximately Offer personalized productsSelling direct lets you collect . ,” which are programmed commands like “Alexa, ask Umbrella Corporation what kind of umbrellas are available,” or “Alexa, checkout,” the assistant can search your store for products and even an Alexa “skilloffering their own brandsPop-up storesZero waste packaging, reduced package sizes, and redesigned shipping cases are also shaping the future of ecommerce. To reduce packaging waste and its fulfillment costs, Amazon is now can match orders with stock in warehouses that are closest to the customer. Automatically routing orders in this manner saves time, expedites fulfillment, and reduces shipping costs., which increases average order values (AOV). Brands are also increasingly relying on inventory management systems (IMS) to : Re-engage viewers within households across streaming devices like computers, tablets, and mobile which provides a more 4. Global ecommerce booms outside the U.S.polled by AfflinkMobile retail experiences in 2019. However, growth has slowed considerably versus the prior five years and is not expected to pick up through 2023:1.4 billion people, an increase of approximately 18% from the year before. Ecommerce is expected to nearly double by 2023 to more than $6.5 billion.Automate your next Simplifying cross-border commerce, reducing the risk of human error in managing multiple stores, and offering a best-in-class shopping experience are three ways ecommerce automation is powering productivity:Expect brands to increasingly bid on  and in brick-and-mortar stores. trigger workflowsSustainable ecommerce goes mainstreamConsumers increasingly want brands to Minimalist packaging orders with shopper purchase histories to determine if individual orders are fraudulent, brands are relying on  will abandon a site that takes longer than three seconds to load. Research suggests mobile expected growth in Connected TV purchasesthe new challenger brands last year, topping $2.27 trillion USD:1. Ecommerce takes share but growth coolsnew streaming entrants that you can use to personalize the customer experience, and ultimately monetize that relationship.Enterprises are turning to stagnant in-store sales growthBy the end of 2020, With a direct customer relationship brands no longer have to rely on retail partners to protect and promote your brand. Establishing a direct relationship with the end consumer also lets you continue to give support after the sale. Likewise, consumer demand to know a product’s entire lifecycle also requires the ethical sourcing of Nothing is for certain. But when one channel, device, or big idea in commerce becomes obsolete, expect another to emerge in its place. Retail death loses its sting when merchants realize they can be reborn. (PWA), which can live on a user’s home screen and are supposed to load instantly regardless of whether the user is online. PWAs may be part of a more shipping options3. PWAs and AMPs drive mobile commerceSome perspective is in order though. While ecommerce is growing much faster than retail, it’s still a relatively small piece of the pie. Premium inventoryOverall, the global retail market was expected to top  (also known as smart TVs) and audio will emerge as two new hotbeds for advertisers. While Facebook and Instagram will continue to be the bread and butter on which many brands rely, expect significant growth in ad dollars targeting consumers who are streaming their favorite streaming television or music services.The other way would be to explore the home assistant market with Amazon Echo Dot users.  By creating But growth rates only tell part of the story—the king of global ecommerce is China. With an estimated The combination shoppers are expected to purchase goods and services online by 2021. Increasingly, these online shoppers live outside the U.S. remains a top barrier to implementing RPA, Businesses will increasingly put operations on autopilot in the coming year. Automation will be particularly beneficial to brands expanding internationally which requires operating multiple stores and larger inventory and fulfillment networks. On average, international businesses ship to While The idea stemmed from a desire to educate consumers and prompt them to question $3 billion10. Marketers target new channels and devicesDigitally native brands go offlineaccelerated mobile pageThe requirementscomprehensive picture will happen on mobile devices. Worldwide, mobile commerce is expected to even more prevalent:sustainable commodities are expected to join the world’s middle class, and most of them (approximately 85%) will be in the Asia Pacific region (APAC). Ecommerce as a whole has already shifted away from the West and will continue to do so even as China’s previously n in 2019.However, Allbirds didn’t disappoint consumers hoping for new products to purchase. Allbirds dropped three new sneakers exclusive to Black Friday. But by offering an in-store experience of crafting, for example, and a limited run of new products, Allbirds created an igreenhouse gas emissionsStandardize merchandising for discoverability16.1% of all retail salesflash sale and analysts only expect it to increase 2% a year through 2023:But just because your ecommerce platform theme offers a responsive site doesn’t mean you’re providing a great mobile experience. Instead of maximizing sales on Black Friday 2019, sustainable sneaker brand Global ecommerce booms outside the U.S., but it was open for non-commerce experiences. Consumers were encouraged to stop by for live music, and free workshops like crafting pom poms, and wreath making.8. Fulfillment expectations and costs soarUse 100% renewable energy. However, this figure was calculated prior to Amazon launching one day shipping. Amazon spent exclusive pop-upsEcommerce automation eliminates many of the manual, repetitive, and time-consuming tasks that reduce productivity. The resurrection of commerce is happening all around us.everyday household itemsDirect to consumer and private-label selling acceleratesLevel 5 automation, or automation that manages itself with no humans involved, will likely require the highest level of machine learning to produce artificial intelligence that can replace human intelligence. Businesses expect to spend big on AI-powered automation. Worldwide AI and process automation expenditures are expected to top $15.4 billion by 2021:Offering the consumer an experience that can’t be had online will drive digital brands to increasingly experiment with offline experiences. While it may not be a brick-and-mortar renaissance, it does follow in the vein of Amazon Go’s retail outlets in which there are augmented reality, at least for now, is one way to win the voice search wars. ecommerce grew 25%In APAC,  of Costco’s sales are private-label, as are 19% of Walmart’s. puts merchandise closer to the consumer which reduces transportation time and costs. Brands are giving shoppers make voice-powered purchases so you can better understand how voice is used in the consumer’s path to purchase... Shifting the focus from discounts to sustainability is a year-round priority for a brand that uses eucalyptus and recycled wool to build products. through Tmall Global and delivers them via a third-party logistics partner. One reason the company  to encourage consumers to  on shipping in all of 2018. Accounting for sales growth and the launch of one day shipping, estimates indicate shipping will cost the company 5. Automation powers productivityBranding its offline experience, “Black Friday? We’re Not Buying It,” the Allbirds store may have been $1.9 trilliononlineAllbirdsBrands operating their own warehouse will increasingly consider robotics to cut costs and become more efficient. Worldwide, there are now more than 3,200 robot-enabled fulfillment centers. add more items to their cart31 countriespackaging systemCommerce is being raised from the dead online, offline, and everywhere in between. The future is bright, and is being shaped by the following trends in 2020 and beyond:Predictions about the future don’t come with probabilities or precise timelines. But the creative destruction happening in retail presents both threats and opportunities, the likes of which merchants have never seen before., partnering with luxury Las Vegas hotels onphysical and digital commerce is blurring, the difference in growth trajectories between retail and ecommerce is still stark (though not as stark as it once was.) Elevated consumer expectations are rule-based order routing shopping malls are being reborn as experiential destinations with  the manufacturing process can also improve flexibility and position brands to reconfigure faster if consumer taste or behavior shifts.. But aligning your brand with a social cause is no longer enough. Consumers increasingly want companies to act as good global citizens by using green manufacturing practices, eco-friendly supply chains, and Pura Vida’s airstream trailer not only creates a new stream of revenue, but also lets the brand engage with fans over food, music, and drinks.While data reveals Warehouse roboticsOne step further combining a PWA with an 26.5% of salestotal market sharecharging feesfree shipping thresholds of the fastest-growing ecommerce countries are from the Asia-Pacific region, Latin America also boasts of accelerated ecommerce growth, including the world’s fastest grower, Mexico:. Besides eliminating waste, the effort requires that all packaging resources be recovered and none burned or buried..stripped down HTMLevery $1 spent on localization, the return on investment (ROI) is $25Importantly, ecommerce automation is also protecting brands from a rising threat: fraud. Instead of manually 26.1% of consumers have made a purchase on a smart speaker in 2019theme parks, ski hills, and water slidesBig box retailers are asking brands to set goals and measure progress toward reducing annual corporate omnichannel approach$25 trillion USDSchedule inventory alerts for reordering and marketing9. Voice recognition changes the path to purchaseonline-to-offline (O2O)10–20% higher than desktop. A key driver of the DTC trend is the rise of private-label brands.To promote the pop-up, The Emazing Group advertises on social media ahead of time:Ecommerce takes share but growth coolssophisticated technology stacks are equipped with at least one smart speaker, with many consumers owning more than one. So it’s not surprising that Like consumer expectations, the costs associated with offering expedited shipping are increasing. For instance, Amazon’s logistics costs, which include fulfillment and shipping, now account for approximately The total return on marketing spend was 12 to 1.reveals streaming fatigue is setting in among consumers, half of whom say they’re willing to view streaming ads to reduce monthly subscription costs.$3.5 trillion USD to cut waste and become more efficient. Smart order routing combined with multi-location inventory, and automated , which sells women’s shoes made with recycled plastics, relaunched its mobile site as a progressive web app (PWA):Artificial intelligence, is its decision to localize., and brands are increasingly using ecommerce automation to scale faster and more efficiently.In response, brands are optimizing search results to include snippets as  of the customer journey48% of the businesses U.S. sales in 2019. While in-store sales still account for nearly how footwear is made. Offering customers local payment methods, Voice recognition changes the path to purchaseYes, an estimated For example, -enabled Better measurementSelling direct positions brands to offer experiences that can’t be had in traditional retail stores. DTC brands are increasingly allowing shoppers to design custom packaging, mix and match custom assortments, or participate in contests while becoming brand evangelists.Rollback those changes automatically7. Digitally native brands go offlineNotice 3.9% of consumers say they buy through a smart speaker daily. Google appears to provide the most accurate responses to questions about commerce, followed by Apple and Amazon:no checkoutsLUX Rave pop-up experienceLocalization will be increasingly important when expanding internationally. A study by the Localization Industry Standards Association (LISA) found that for : Track the impact of your CTV campaigns with digital and traditional metrics, including video completion rates and gross rating points: Use first- and third-party data to reach your most valuable audiences on every screen–just like with your digital campaigns can yield better search results, more top-of-funnel traffic, and improved conversion rates onsite. 6. Sustainable ecommerce goes mainstreamConnected TVs that spans tens of thousand square feet during 2019’s web application are currently pulled from search engine results snippets.  for its suppliers. The assessment checks each of their supplier’s commitment to:65% of retailers will offer same-day delivery, and it’s becoming the norm. On the other hand, worldwide ecommerce sales topped . of online U.S. retail sales is now higher than general merchandise sales for the first time ever. by 2022. While Mobile conversion ratesad-supported subscription optionsustainability index$27 billionStreamline tracking and reporting90% of total retail salesPWAs and AMPs drive mobile commerce have picked up online orders in stores.. 53% of consumershot consumer economythis survey. Driving much of this market share growth are the retail partners on which legacy manufacturers have historically relied on for distribution. They’re increasingly Selling direct yields three key benefits:first-party dataEcommerce automation Beyond 2020 expected to happen online in 2020, manufacturers and traditional brands are increasingly bypassing retail partners and selling DTC. In fact, it’s ecommerce growth that is helping legacy manufacturers offset voice commerceEnergy-efficient and resource-saving manufacturing is just the start. In the future, customer satisfaction is likely to hinge not just on price and quality but how brands manufacture their goods., a fast-growing maker of handmade string bracelets and accessories, takes an omnichannel approach by bridging the digital and physical worlds. Born online, the brand was built on the backs of social media platforms and has millions of followers and fans. However, Pura Vida recently launched a retail experience through social media that allows consumers to interact with the brand in the real world.mmersive holiday experience68% of consumers where all materials are used, reused, or recycled so there’s no waste product. Driven by consumer demand, it requires that brands do more than simply use Eco-friendly supply chainsGlobal ecommerce sales are expected to top Create zero waste. To track this, and other links in the supply chain, Walmart has created a  are the most common products to be purchased via voice, buying apparel is nearly just as common. This not only suggests that the path to purchase is starting via voice, but it also hints that consumers are inclined to start voice shopping more in the future. cost partners with the Luxor hotel and casino in Las Vegas for a  and progressive web applications (PWA), the world is becoming a storefront as brands enable commerce via smart mirrors, video games, and live streams., and translating content into local languages is improving the chances of cross-border success. natively embedded in their ecommerce platform. Automation can prevent high-risk orders from being fulfilled and prevent costly chargebacks.Marketers target new channels and devicesThe ad is a sneak preview of the pop-up store and was shot just before it opened. It’s a strategy The Emazing Group uses to target people in Las Vegas in real time. The ad reached 250,000 fans of EDC & EDM in the Las Vegas area and received 200,000 total views.37.7% of onlineavoid stockoutsDon’t expect the trend toward faster shipping to abate as 61% of consumers Integrate third-party apps to Pura Vida Bracelets2.1 billiontreating workers humanely (DMS) are being considered. These are decentralized networks of adaptable and flexible mini-factories. Putting manufacturing closer to the end consumer reduces emissions by cutting transportation requirements. It can also stimulate regional economies that benefit from jobs produced. Two thirds of consumers say one of the main reasons they abandon digital shopping carts include costly shipping and delayed shipping: experiences. With  closed its Covent Garden location in London, U.K., to tout its commitment to conscious consumption.  in 2020 and beyond. The trend may even stretch into the middle of the decade when you consider the many  to sellers that don’t comply with its packaging guidelines. Oversized or unnecessary packaging results in a $1.99 charge. Worldwide spending on robotic process automation (RPA) is expected to top lead with their valuesThough the line between  is a You own the customer relationship that delay instant fulfillment. or product drop By 2021, analysts estimate : Run your ads alongside popular TV shows and movies, in front of an audience that’s fully invested as part of a well rounded local currenciesTo realize the environmental benefits of sustainable manufacturing 100% Pure sells cruelty-free products directly to Chinese customers and components. This includes minimizing the impact on the environment as well as  regarding shipping speed and costs are changing retail. Entering 2020, analysts estimate $35 billiocross-checkingPrivate-label products are Featured snippetsSecond and third tier40% of voice results. Premium private-label products, or those that are perceived as higher quality than branded products that sell at higher price points, now account for 7.2% dollar share of US private-label products, up from 5.9% three years ago: cools a bit.premium private-label brandsMuch of ecommerce growth is attributable to Amazon, which is growing at above-market rates and was expected to account for $4.2 trillion USD. Legacy manufacturers and CPG companies are reinventing themselves by selling direct-to-consumer (DTC)automated fraud protectionList new products on multiple channelsTo offer an optimal mobile experience across, some brands opt for a . Amazon will also give you access to anonymized transcripts of user speech data and  (AMP), which are mobile-first According to The Trade Desk, the connected TV gives advertisers many of the same data-driven benefits of social media advertising with the added bonus of  as well as the Zero Waste PackagingStationing inventory in Importantly, consumers aren’t just turning to private-label brands to save money—they’re turning to targeting consumers with highly relevant ads during their favorite streaming showsreduced waste packaging copies of web pages that load instantly. AMPs are the foundation of Google’s mobile-first index, which prioritizes mobile optimization in search results. 2. Direct to consumer and private-label selling acceleratesquadrupled sales year-over-year35% of all U.S. households in 2020 and reach more than $6.5 trillion by 2023. More than 12,000 retail locationsThe Emazing GroupWith high quality streaming ad inventoryNearly one-third in Las Vegas. 20% of the consumables marketmultiple locations include replacing boxes with flexible mailers, using fully recyclable mailers, and better matching products with appropriate sized boxes.The Trade Desk, a programmatic advertising platform, illustrates the momentum new devices and channels have heading into 2020. On Black Friday 2019, the company suggests the connected TV became an essential digital media device for marketers, and audio was not far behind.This is another reason digital natives are experimenting or partnering with brick-and-mortar retail. Buy-online-pick-up-in-store (BOPS) options can materially reduce shipping costs. Data suggests  in ecommerce sales in 2019, online sales in China are three times that of the U.S. In fact, China’s share of the global ecommerce market is 54.7% or nearly twice that of the next five countries combined: that would let customers pay less for the service in return for watching a few advertisements. Furthermore, .In 2019, ecommerce share of total global retail sales was 14.1%Sustainable manufacturingdistributed manufacturing systemsheadless commerceDecentralizingTag and segment customers for retentionheadless commerce that use new technologies like automation expect it to help reduce their workforce.sustainable packaging suppliesclosed for retailbounce ratesintent request details“Like many other brands, we see the majority of our traffic from mobile devices—a trend that spiked during the holiday season as consumers were away from their desktops,” says Gigi Teutli-Vadheim, Rothy’s Site Experience Manager. “In terms of the customer experience, we’re shifting our focus to be mobile-first and prioritizing speed to ensure users are satisfied.”Identify and cancel high-risk ordersFulfillment expectations and costs soar to cater to those who don’t need their products right away. They’re also displaying cutoff times that clearly illustrate when orders must be placed for different shipping options.more than halfThe Trade Desk’s CEO Jeff Green even believes Netflix will soon offer an Automation powers productivitySell sustainable productsEDC WeekTo meet consumer expectations and defray expedited shipping costs, brands are intelligently setting  want their shipments delivered within three hours., and testing  to accelerate growth.53.9% of all ecommerce salesData-driven targeting were expected to close last year, But don't let the headlines skew your perspective—what dies in the mall is being reborn online, and what was born online is increasingly crossing over to the physical world.Smarter retargeting strategy that lets teams work on the front- and back-end systems simultaneously to further improve mobile performance. Cutting edge digitally native brands are experimenting with Collect and use customer dataPre-load storefront changes for major events outside your ecommerce ecosystem like email win-back sequencesRothy’sEstimates suggest Swap commerce for experiences are less than half those of desktop. Research indicates You don’t have to seize every trend vying to shape 2020 and beyond. What your customers do expect is that you’ll meet them where they are, providing a valuable customer experience regardless of whether it comes offline, via voice, or the expectation that you operate in eco-friendly ways.Part of its strategy lay in Juhuasuan, a group-buying feature within Tmall for flash sales that also leverages live streams with Chinese influencers. “You don’t want to market in China the way you market in the U.S., so I needed local people to help,” says co-founder, Ric Kostick. “You have to do it the local way.”It all sounds costly but could prove lucrative. Research indicates consumers are willing to pay a premium for goods produced in socially compliant ways: since consumers are willing to abandon brand loyalty for what they perceive as better value. Importantly, private-label brands are taking share in both , the  that compete against those produced by legacy manufacturers. Selling direct is a response to increased competition from retail partners offering their own DTC private-label brands.
Ecommerce share of total global retail sales from 2015 to 2023
Private label dollar share by price tier
mobile retail commerce sales as percentage of retail ecommerce sales worldwide
Retail ecommerce sales growth worldwide, by region
Top 10 countries, ranked by retail ecommerce sales growth
Top 10 countries, ranked by retail ecommerce sales
total automation and artificial intelligence operations expenditure worldwide
How much more are U.S. internet users willing to paying for socially compliant products?
Primary reason for US shoppers to abandon their carts
Smart speaker user case frequency in the US as of January 2019
Performance comparison between different smart speakers
Black Friday programmatic impressions growth

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