2021 has hit the e-commerce space with some serious challenges including the global shipping crisis and supply chain bottlenecks. But the year also saw e-commerce retailers stepping up their game to deliver better customer experiences and meet rising consumer expectations.
When the global pandemic forced international shutdowns, e-commerce became the way forward for retail. But as businesses quickly moved their operations online, many were unsure which e-commerce channels to prioritize.
Now, as we look back at e-commerce trends in 2021, e-tailers can better understand where to focus their efforts in 2022.
We have seen an increase in mobile sales and a shift towards social commerce, among other trends, which will significantly influence e-commerce planning in 2022.
9 E-commerce trends to watch in 2022
2021 has seen some interesting e-commerce trends, some of which were expected, while others took us by surprise. Now that your awesome holiday campaigns are complete, keep them in mind as we look at lessons learned. For most e-commerce businesses, the holiday season is the biggest expense and push. Think about what has worked for you, then how the other trends we look at can improve and grow your vacation successes.
If you're going to experiment, give it a try in early 2022. You want to get a feel for what's useful long before your next year-end holiday campaigns start.
Mobile phone sales continue to grow
Mobile commerce sales are growing steadily, reaching an all-time high in 2021:
(Source: Oberlo )
In the years before 2016, it was not uncommon to find websites that weren't mobile-friendly. Many e-commerce brands were generating enough sales simply by being compatible with desktop computers. But it's now 2022, and consumers are prioritizing convenience even more. Mobile shopping makes it easy for consumers to place orders on the go, and its appeal is reflected in the numbers.
To keep pace with the growth of the mobile e-commerce market, most online retailers are ensuring that their stores and funnels are mobile-friendly. However, as mobile shopping sales increase, you may want to see how your existing mobile marketing can be improved. Can your brand take steps to make shopping even easier for mobile users?
Social commerce and live shopping are gaining popularity
More than 200 Instagram users visit a brand's page every day, and 58% of Instagram users engage with products after seeing them on Instagram Stories. Thus, consumers are not only using social networks to stay in touch with their friends; they are looking to buy.
Not surprisingly, social media giants like Facebook and its daughter brands Instagram and WhatsApp have quickly embraced social commerce. Over the years, we've seen Meta-owned social media platforms evolve beyond Instagram and Facebook Shopping to offer more creative options like WhatsApp Business and Facebook Marketplace.
More recently, FB and Instagram live streaming features allow brands to connect directly to the products they are talking about. So, as social commerce becomes more and more vital, we expect to see social media giants continue to develop their shopping features.
Sustainability-focused consumers
As consumers become increasingly aware of environmental issues, they are demanding brands to meet higher standards of responsibility. Statista conducted a survey to better understand which eco-friendly brand attributes are important to consumers, and 45% of respondents were looking for eco-friendly or sustainable brands.
Many e-commerce brands are stepping up their sustainability efforts, for example by reducing their use of plastic. But, to meet consumer expectations, we can expect brands to become even more environmentally conscious in 2022. Additionally, brands that have yet to introduce sustainability practices may follow suit. .
Supply chain resilience has become paramount
The pandemic has disrupted supply chain operations in 2020 in unprecedented ways, and 2021 has yet to recover from the repercussions. We're still experiencing global shipping issues, supply shortages (which forced Apple to stop iPhone production) , and inflation, among other issues.
Some sectors have been more affected than others and some companies have performed better than their competitors. But, in general, most e-commerce brands have faced supply chain issues. These issues have encouraged brands to prioritize supply chain resilience and adopt more flexible supply chain strategies in the face of disruption. Businesses are struggling as research shows customers still want expedited shipping options, but it's getting harder to promise and deliver.
Increased use of Google Local Inventory Ads (LIA)
In 2021, more e-commerce brands leveraged Google LIA and LSA (service ads) to increase local sales. Local inventory ads from Google help you increase your visibility and get closer to "ready to buy" customers. When a customer in your neighborhood enters a search time like "red shirt near me," your ads will feature your in-store products and store information. One of the great benefits of using LIA ads is that they display inventory currently in stock, allowing you to quickly convert customers who are already in the buying phase.
Move to POAS from ROAS ad spend strategy
While ROAS technically stands for “return” on ad spend, many e-commerce brands calculate “revenue” instead due to the complications involved. Unfortunately, revenue forgoes key considerations about your profit margins, including shipping costs and fixed costs, making it an unreliable indicator of success.
However, due to the convenience of the metric, many companies have stuck with ROAS. They would simply set average or differentiated ROAS targets, or a highest profitability target. But these strategies all have pitfalls, leading to inaccurate data or leading to poor decisions.
2021 has been a tricky year for digital advertising – iOS updates have created a huge divide between retailers and consumers, and ad spend has skyrocketed across many industries. And with these challenges, it becomes necessary to adopt more strategic spending strategies.
Therefore, as 2022 approaches, more companies may switch to POAS (Profit on Ad Spend) to measure performance. POAS is more reliable because it takes into account additional expenses, such as your fixed costs. The KPI realistically determines the success of your advertising spend; as long as your POAS is greater than 1, you benefit from ad spend.
Implementations for the future
In 2021, e-commerce brands have adopted new strategies to deliver better customer experiences. As we move forward into 2022, we can expect to see more implementation of:
Omnichannel is the name of the game
The retail e-commerce industry is increasingly competitive, so if your prospects can't find you, you'll lose them to competitors. So don't let them hunt you down. Instead, increase your brand visibility and plug into platforms that host your target audience.
Relying solely on Google search is not enough, nor is it dependent on social media. Use both, because consumers interact with brands on different channels. Additionally, according to research from Sprout Social, nearly 85% of customers won't make a purchase until they've seen a product multiple times. Thus, an omnichannel presence is essential to generate conversions.
Artificial Intelligence (AI)
Although IBM's Watson hasn't lived up to its hype, AI has brought revolutionary changes to the e-commerce industry. Artificial intelligence has helped e-commerce brands improve customer service at lower cost and deliver more personalized experiences.
Read also: SEO Next-Gen (new generation): a vital source of business intelligence
Product recommendations
Invesp's Product Recommendations Survey found that 49% of customers bought a product they had no intention of buying, after receiving a personalized recommendation. So, given the critical importance of repeat purchases, e-commerce retailers cannot afford to underdeliver when it comes to personalized experiences. That's why many businesses are adopting audience-specific e-commerce merchandising practices in 2022.
Chatbots
Chatbots have become mainstream, with more than two-thirds of customers using them in 2020. They offer customers a step above “self-service” support, without requiring any human intervention.
So if you're not already using chatbots, you might want to consider upgrading your 2022 customer service strategy with them. Chatbots provide 24/7 customer support without the high costs of hiring 24/7 staff. You can create complex flows to handle common support requests and integrate functionality live chat to allow support agents to take over if needed.
Read also: E-commerce for 2022 - Chatbots, voice search, omnichannel marketing
Hyper-personalization
After being directed through Google search, Bob lands on your e-commerce store, looking for a smartphone. He finds one he likes and adds it to his basket. Now your store's AI kicks in and recommends a hair dryer, but Bob isn't interested, so he proceeds to purchase just the smartphone.
If the AI had recommended a smartphone case or screen protector, Bob's order value might have been higher. And that's why hyper-personalization is essential to modern marketing.
With hyper-personalization, e-commerce brands drive repeat purchases by strategically guiding customers into valuable purchases. You can upsell or cross-sell to increase revenue, while simultaneously delivering value to customers and increasing loyalty.
Augmented and Virtual Reality (AR/VR)
While online retail takes the cake for consumer convenience, one advantage of brick-and-mortar stores is physical navigation. Consumers can look and feel physical products before completing their purchase, giving them more confidence in their buying decisions.
And while augmented and virtual reality seems like a futuristic concept, many e-commerce brands have embraced it during the pandemic to fill that gap. With AR/VR, consumers can "walk through" and view objects from multiple angles (and even digitized doorways for objects like cars), inspiring more confidence in their purchase.
Conclusion
2021 has not seen fundamental changes in marketing principles, as the tenants remain the same; deliver better customer experiences, help your audience find you, and optimize your supply chain operations.
As we venture into 2022, some important takeaways for 2021 include:
- Meet your customers in their favorite places. Does your target audience enjoy spending time on TikTok ? Or maybe they prefer shopping on Instagram? Learn about the platforms your audience uses and think of creative ways to meet them. For example, if your target audience uses TikTok, negotiating a sponsorship deal with a popular creator can help you increase your brand awareness.
- Don't just personalize; hyper-personalize. Segment your audiences, then segment your segments. One of the many benefits of big data is that brands aren't limited to basic segment categories like age or location. Now you can discover your customers' interests, social causes, shopping habits, and more.
- Get creative with your logistics planning. While supply chain disruptions are inevitable, retailers can control how we respond to them. Audit your fulfillment efforts and identify areas for improvement, whether it involves using inventory management software, distributing your inventory, or outsourcing your logistics to a fulfillment partner.
- Step up your advertising game and audit your marketing strategy . Digital advertising has faced many challenges in recent years, but it remains essential to your e-commerce strategy. You may need to re-evaluate how you monitor ad spend performance or increase your local advertising efforts, but ads aren't going anywhere.
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