“Life moves pretty fast. If you don’t stop and look around once in awhile, you could miss it.” -- Ferris Bueller.
Do you know where life is headed for your ecommerce business in 2017? If you don’t have time to monitor emerging trends and strategies that’ll impact online sales, don’t worry. We’ve got you covered.
During the months of December and January, the internet is filled with predictions about the New Year. The oracles at Shopify Plus have made some ecommerce forecasts of their own.
But instead of using a crystal ball, we enlisted the help of Plus team members who are on the front lines; developing the latest ecommerce product and sales solutions, selling online, and hearing about your pain points daily.
Let’s take a look at where they recommend placing strategic bets in 2017.
Prioritize Mobile First Design and Payments
Over the past year, Shopify Plus has written a lot about the future of mobile commerce. “The vast majority of customers are now interacting with online stores using a mobile device. But merchants still aren’t treating it the right way,” explains Loren Padelford, General Manager at Shopify Plus. “Merchants need to prioritize the creation of custom mobile experiences in 2017; not just a responsive site.”
This Black Friday, online sales hit a record $3 billion, and mobile devices accounted for a third of those transactions. Those numbers will continue to skyrocket in 2017.
As such, Padelford says merchants must not think of their mobile UX as representations of what’s on the web.
“It can’t just be done the same way as on a handheld device,” he explains. “You need to think about mobile customer interactions, merchandising, and integrating systems like Apple Pay to make it a seamless experience.”
Sheena Brady, a Shopify Plus merchant success manager and owner of her own ecommerce store adds that even her customers are asking for improved mobile experiences on her site. “Simply put, all merchants need to make mobile usability a priority in the next 12 months,” she says.
Mobile Payments Will Offer More Convenience
David Moellenkamp, Director of Product at Shopify Plus, argues that merchants should keep an eye on the continued adoption of mobile payment types, like Apple Pay and the work they're doing with the W3C in 2017. “It only makes sense that if most people are using mobile devices, it’ll be far more convenient to the buyer to checkout that way,” he says.
The sheer convenience that mobile payments can offer has massive implications on impulse purchases and getting people to buy more on mobile devices in the future. If you aren’t accommodating that need to “buy now,” your customers will simply go elsewhere.
“Payment options like Apple Pay are ridiculously easy to use, and customers will soon be able to go to a mobile site and pay by simply using a thumbprint,” says Moellenkamp. Now is the time to start investigating how to offer those services to your customers.
Offer More Unique Customer Experiences
Sheena Brady advises many of her Shopify Plus clients to “focus 80% of your time on your top 20% grossing products because they offer a more powerful sales opportunity.”
To get a strong ROI on those products in 2017, she recommends optimizing customer site search, unboxing and email experiences using big data to drive segmentation and personalized offers.
This strategy is especially important because a recent Walker report revealed that by 2020 “customer experience will become the main product differentiator, replacing price.”
Site Search Enhancements
Brady recommends investing in a third-party solution to integrate with your Shopify Plus store. “People are starting to get more specific and zeroing in on unique types of products in their site searches. So you always want to ensure that you're not making it hard for them to find those items,” she explains. “Integrated Shopify apps do a great job of helping to 10X the search experience on your site.”
“That works out well for the merchant and for the customer who's being super specific in their queries for your products,” says Brady. “A recent Demac Media Study reveals there's been a 200% increase in conversion rates for customers who use internal site search -- even more reason to prioritize it in 2017.”
To learn how to convert more customers using site search, check out this helpful post on the Shopify Plus blog.
Shareable Unboxing Experiences
To get more repeat customers, Brady argues that they must fall in love with the entire brand experience which includes receiving your product. “I think all merchants can ‘up our game’ and improve the customer unboxing experience,” she says. “I think it is going to be way more important in 2017 than it even is currently.”
Plus Merchant Shore Projects creates a delightful and memorable unboxing experience by “making it about the lifestyle of their customers who love the experience so much that they become ambassadors,” she explains. “You don't even know that you're getting these things when you place an order. They just automatically come to you, and it’s a nice surprise.”
With every watch that you purchase from the online merchant, you get a beautiful lifestyle-based lookbook, plus a tote bag with your delivery.
Here are some tips on how to create a killer unboxing experience from the Shopify Plus blog.
Enhance Personalization with Big Data
For many years, personalization has been a massive focus for the ecommerce industry. But with the growing onslaught of data that everybody has in big data warehouses, Moellenkamp believes personalization will be taken to the next level in 2017 to enhance experiences for individual shoppers.
“If a customer is on Facebook or Instagram, or if they're coming at you through Messenger, you can tie all those channels together to get a central view of the customer,” he explains. “Then you can personalize the experience they have across those channels in a much more immediate way.”
Sheena Brady says this will be particularly relevant for segmenting and personalizing customer email offers in 2017. In fact, a recent Demac Media study reveals that one-third of all of the email revenue generated by segmenting and targeting comes from just five percent of customer emails.
To get started, Brady recommends segmenting into a country, city or a general area and then creating unique promotional campaigns based on each location. You can also dive deeper and look at which types of buyers purchase the most on your site and customize offers to them directly.
For more tips on email segmentation strategies, check out Shopify Plus blog contributor Ott Niggulis’s post.
CPG & Industrial B2B Brands Must Test Ecommerce Channels
In 2017, Padelford and Moellenkamp argue that we’ll continue to see traditional consumer packaged goods (CPG) brands experiment more with direct to consumer channels. “Disruption came from startups like Dollar Shave Club which are forcing big brands like Nestle and P&G to go online and cut out middle-man,” says Padelford.
"I think platforms like Shopify Plus are hugely valuable to these brands because they may not have the ecommerce chops or the internal knowledge,” adds Moellenkamp. “We can help them get up and running quickly so they can start experimenting to see what works.”
Moellenkamp says it’s quickly becoming the time where if you're a big brand and you're not getting into ecommerce, you're in trouble.
Padelford also expects we’ll see a lot more B2B industrial players begin to adopt ecommerce next year.
“It’s less sexy, but they have a huge transaction volume and have been relatively untouched to date from an ecommerce perspective,” he explains. “You’re going to see more wholesalers, and PO-driven companies (e.g. Caterpillar and oil companies) shifting to online sales to be more efficient.”
Test Chatbot and AI Interactions
Moellenkamp recommends that merchants monitor how customers are beginning to interact with brands via chatbots and artificial intelligence (AI) in 2017 and beyond. “These pieces of AI are now being put into the path of the buyer or with the merchant, and allowing customers to interact with bots,” he explains. “In 2017, it's going to be big but in 2018 it's going to be even bigger.”
To understand what that looks like right now, check out Aaron Orendorff’s post on customer interactions with Facebook Messenger bots.
Moellenkamp argues consumers will soon become used to engaging with AI in a very natural way.
“They might start to prefer those types of interactions over typing and chatting with a real person on the other end,” he says. “And a merchant won't have to staff those interactions. Instead, you can use technology to provide a more high-touch experience.”
He says the nirvana for the world of bots is the point at which you don't know you're talking to one. As such, many people are predicting the next generation of UX designers will be language designers and writers.
Experiment with AR and VR
While there’s been a lot of talk about how virtual (VR) and augmented reality (AR) are the next big thing for ecommerce, the Shopify Plus team is seeing mostly experimentation with full virtual reality shopping experiences right now.
“VR is a long-term play,” says Padelford. “In the short-term, I think you’re going to see cooler, mobile augmented reality apps coming out in 2017 for customers to play with on their phones in-store.”
So if you have the budget to experiment in this area, you can try out more fun, interactive AR shopping experiences this year. Just make sure you’ve covered your bases with an optimal mobile shopping experience first.
Industry Growth in 2017 & Beyond
Shopify Plus recently launched a new Industry Reports Series which evaluates how emerging ecommerce technologies and trends will shape the future of specific industry verticals. Here’s a quick snapshot of what some verticals can expect in the next 12 months and beyond:
The Clothing and Accessories Market is expected to grow by 12.2% annually to surpass $1.9 trillion USD by 2020. Ecommerce sales for clothing and accessories currently make up a 17.2% share of total sales in the U.S. Fashion and apparel retailers must focus on mobile, personalization, and social commerce in the coming years to address shifting consumer behaviors.
Consumer Electronics: Worldwide, ecommerce sales of consumer electronics are expected to grow at a compound annual rate of 10% through 2020 to more than $298 billion USD. Demand for new technologies such as virtual reality, wearables, and the Internet of Things (IoT) is expected to increase dramatically.
Home Goods & Furniture: Despite predicted double-digit growth through the second half of the decade, industry analysts question whether ecommerce will become as important to the home goods industry as it has for other verticals. Growth in this sector will require manufacturers to build and design products for the IoT with security in mind.
Fitness & Sports: While ecommerce accounts for just a small portion of overall industry sales, online fitness and sports sales have in some cases doubled over the last several years. Dominated by wearables, health and fitness tracking devices, and apps for monitoring their progress in real-time, these industries are merging customer experiences in the digital and physical worlds.
Toys: When infant toys are included in global forecasts, this industry’s growth rate is expected to be 12.27% in 2017. While ecommerce accounts for just a fraction of the toy industry’s overall sales, the channel is growing faster than brick and mortar toy retailers.
- Baby Care: At $66 billion USD, the global baby care industry is expected to grow at a compound annual rate of 7-percent through 2017. Online baby supply purchases are accelerating, in many cases at a double-digit rate, as research indicates busy parents see ecommerce as a way to buy in bulk and save time.
We’ve given you a quick glimpse into where ecommerce is headed in the next 12 to 18 months. Prioritize what’s most important for your business.
An optimal mobile UX and checkout experience is a must in 2017. Also, ensure you’re providing excellent customer experiences in areas like site search, unboxing, and personalization. If you’ve got the resources, begin testing chatbots and AI, and experiment with AR.
For CPG brands and B2B industrial manufacturers, the time has come to embrace ecommerce. Finally, keep an eye on how emerging technologies and trends will shape your industry’s growth in the years to come.