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From the TheGenieLab US - TheGenieLab Blog blog
With Ecommerce heading to $3.45 Trillion in global retail sales according to Statista for 2019 with a projected $4.88 Trillion by 2021, the trend in innovation in Ecommerce continues to have strong growth.
With this in mind, competition will increase not with just products/services, but with the use of innovative Promotional tools, Artificial Intelligence, Logistics optimisation, Supply chain management and many more areas of a business needing refinement to a well-lubricated operation.
Below are the top 5 emerging trends that will help you keep ahead of your competitors this 2019.
1. Dropshipping
Through bypassing storage and logistics of your inventory this drives key financial upside, operational time all the while you can leverage larger stocks that you could inventory with your cashflow (gain in scalability).
If this applies to your business and would satisfy your clients with this business model, then apps are available to do this where a sale is automatically relayed to your supplier and can go as far as ensuring your brand, pay slip and labels are promoted clearly with the package. Just like you would have done it in-house. Sure, it does require a vendor arrangement, testing of the logistics – but this investment pays off in spades:
- If you have a net-30 arrangement with the vendor, you take in the retail sales and have to outlay the cost of goods 30-days later. Cash flow improves tremendously. Even if it is net-7, the cash position is way better than inventory held in your warehouse.
- Storage/rent fees are reduced, with less of logistical operations to deal with. While it may not be the big winner, it does assist in your cost/management of logistics.
- If you happen to have a popular product and the vendor is a distributor with large volumes, then leveraging and scaling your business is very possible with very little risk of your outfit capping the supply to the client base.
Unlike business as usual and add dropshipping to your business model, there are a few areas to address and ensure robustness before letting automation to your vendors take your orders.
- Time to ship must be well measured and understood. You don’t want additional delays due to their method of shipping, and shipping methods must be aligned to what you offer on your website.
- Out of stock – this is a crucial one, as you must ensure that their stock availability is in-line with your store. While you would have dealt with this issue with a normal inventory model, getting notification from the vendor is a new reach, and with time lags can be a customer experience exposure.
The 2018 State of the Merchant eCommerce Report found that out of 458 online stores, 16.4% were using dropshipping with 18.6% using a Hybrid model.
2. Multi Channel Selling
With Amazon growing ever bigger, eBay and various other channels, shoppers are diverse in their method of searching and informing themselves about a product and service. Social Media platforms are now the propagation tools of these channels where integrations are established and can leverage your various channels in how you value-propose your product or service.
According to The 2018 Omnichannel Buying Report, 87% of consumers in the US shop offline. 78% of the survey respondents reported making a purchase on Amazon, 45% in a branded store online, 65% in a brick-and-mortar store, 34% on eBay, and 11% on Facebook.
The report will go into demographics and purchase behaviours with the trends taking you to a multi-channel model. With today’s integration tools to these various channels, it has become increasingly easier to operate and manage them. This covers real-time inventory (through synchronisations), collating invoices and accounting.
Integrations with Omni-channel Cloud services offering (ERP - Enterprise Resource Planning) such a Veeqo, Brightpearl or TradeGecko can give you the intermediary and control you might require, relieving the e-commerce platform to consolidate and control the channels directly, letting the ERP platform do the consolidation. Additionally, some of these ERP platforms have additional features such as consolidating your client database, making all the invoices uniform before passing them through accounting software, etc.
3. Smarter Payment Methods
According to Baymard.com, the average cart abandonment rate is 69.57% with a survey of 41 online stores. That’s an impressive number considering that online shoppers have taken the time to find what they desired, considered their decision, and are ready to checkout.
Of all the abandonments, 28% of shoppers chose to leave due to a complicated or long checkout process. Tools like a one page check-out, various payment methods (Paypal, Credit Cards, etc.) have been available for some time – so what’s next?
Shipping costs not being “up-front” is a big hitter at 23% and 60% - not being at the decision point of picking out the product. This is why “Free Shipping” is so popular as a promotional tool, which makes it easier for clients to have greater confidence at the checkout price to overcome without being hit with additional charges. However, what’s not listed there? What is the opportunity going forward? Maybe globalising your store is something to consider.
Globalising is no simple step, as translations, currency, different marketplaces are all at play. Take payments for an instance, according to BlueSnap’s article on cross-border payments have several points of failure, and resolving these can bring an upside on transactional volume. From Translated checkout pages, local currency, local payment processor, and several other factors will be in your way in reaching a global clientele.
Overcoming these barriers will require you to choose carefully your processor, your Ecommerce platform/integration and have your products multi-currency priced with local taxes clearly displayed on a translated one-page checkout. Varied connection resilient (using VPN’s and remote accesses), cross-browser and device (mobile, tablets especially) is also a crucial part of the quality and polished delivery. For a single currency/language platform such as Shopify deliver a consistent quality experience due to meeting the demands of a global shopping community, with restrictions at the lingual/currency. Multi-store (Multi-lingual) capabilities and various currency pricing for a product which can be loaded into platform like Magento can deliver the infrastructure you might require. Where Magento has many card processors integrated, and supports multi-lingual/currency/tax/shipping, the marriage between your platform, processor, product hierarchy will give you the optimal solution on a successful cross-border expansion.
4. Artificial Intelligence vs. Branding/Product strategy
Brand equity online and customer experience is not that different than brick and mortar stores. Having a strong brand, intuitive layout, good presentation, clear pricing/discounting, ease of purchase and checkout and a good selection of product/services. But how can we enhance the experience to be more interactive without pestering the client with techy pop-ups, and other annoyances online?
Having a good interaction with your store is key to reduce the bounce rate, having the client informed and ensuring that their needs are met when it comes to making choices. AI is your virtual in-store clerk that monitors a visitor, will suggest goods that are relevant to what’s being browsed or added to the cart, all the while being available to chat. However, how do you achieve that experience on your Omni-channel strategy?
While marketplaces like Amazon and eBay have some of the AI tools, they are not necessarily suggesting your products/services so the burden is on you to have a stronger identity for your goods as they are represented outside of your own store. Product imagery for visual identity is key, value proposition to be clear/inclusive and suggestive if other products are related. Consistent product descriptions and tagging being set on all products is key. Allowing all marketplaces to being consistent and for easy searching – enabling social media propagation.
AI is a growingly adopted tool in hosted online stores, but it does not solve the experience at the omni-channel level – which requires painstaking work with product upload sheets, imagery and tagging. With this structured foundation you are enabling consistency at your channel level, while AI will be able to learn from your client’s interactions in your store and take it a step further.
5. Branded packaging
As a follow through to the above point on Branding and its equity, this point only re-enforces the point when the product arrives at its destination. With the same point made at the brick and mortar store, walking out with the branded bag and the goods within it, packaging for an online delivery is the correlated experience.
For in-house warehousing and inventory – the packaging replacing “vanilla” boxes could be straight forward. For dropshipping, this may not be a simple logistic, or cost of doing business for that matter. What is clear, is the direction to differentiate your brand is heading in that direction. However, for products where Brand is a defining tenet of a commodity within a consumer market – those businesses will be the first takers of this direction.
Companies like Packhelp are giving online businesses an easy way to design and order your packing materials to deliver your branded experience to your client’s door.
Summary
Endeavouring in a stronger brand, reducing the barriers at checkout with a more global appeal are the key means to grow your business. AI will be an increasing part of the online experience, yet the focus of better integration between store/payment gateway/processors will continue to be challenging in delivering a great experience. Omni-channel is a great way to bring your products to new marketplaces, just be mindful on synchronising your inventory, invoices and accounting. With these 5 emerging trends addressed in your store strategy, we hope that your store’s continued success is in a stronger position.