When we predicted online and offline shopping trends back in 2017, the focus was, inevitably, on mobile searches, branding, and the buyer experience. When we look at what the future holds in a retail capacity, especially now about the pandemic, everyone relies more on what online shopping can do. But what is the potential for the future of online and online shopping in the next year?
Premium Brands Operating Privately
The last few years have been all about D2C (Direct To Consumer) commerce. Customers have needed access to brands at lower prices, but there is a growth in premium private label brands. The D2C sector is experiencing a massive shake-up; customers are looking to private brands not for any form of the bargain but because of superior products offered and the personal and improved shopping experiences associated with premium brands:
- Premium private label products now account for a 7.2% dollar share of US private label products, increasing from a 5.9% share in 2016.
- The discount private label’s share has decreased from 37.0% share in 2016 to 34.2% share in 2019.
While many users rely on eBay or Gumtree for their second-hand purchases, the shift has moved to sustainability instead of cost:
- Research by ThredUp predicted the second-hand market to double within the next five years.
The luxury market is increasing its grasp, and this is where second-hand sales of luxury items will change this industry. Brands are now opening up their own reCommerce marketplace. eBay or Gumtree’s experience is a no-frills unexciting approach, but the reCommerce industry provides an exciting shopping experience.
Artificial Intelligence Helping Businesses Source Customers
AI is already helping customers to find specific products and visualize their products better. From the perspective of a business, AI will soon help online stores find customers for intelligent algorithms. Current trends analyzed alongside the sales channels buyer behavior and the products show a personalized approach for the customer to benefit. From the perspective of businesses, this will save hours of report writing and number-crunching from boosting profits right away.
Taking E-Commerce Into the Real World
This is where it gets interesting. While brick-and-mortar stores are still vastly popular, the growth of e-commerce in light of the pandemic has highlighted that while people are still looking to purchase items online, there is a growing trend in mixing the online with the physical world. E-commerce s booming, and while it’s not catching up with brick and mortar stores, there is a growing trend for pop-up shops with our favorite online retailers:
- Online retailers, Amazon has unveiled a chain of physical convenience stores to purchase groceries and everyday items.
- Amazon’s physical store’s segment incurred $4.3 billion in sales in Q2 2019.
Physical locations are still here to stay, but many retail outlets will soon become a place for experiences. Much like the common car showroom, many retail outlets will start to use stores as a way to display products. But the brick-and-mortar store is not going anytime soon. While the E-commerce numbers have crept up in 2020, and retail stores have not benefited as much from the pandemic, customers now prefer to get groceries delivered or purchase items online. But the brick-and-mortar store that we all know is not going away.
Smart Home Assistants
The customer in 2017 didn’t have as much access to smart products as the contemporary one. Alexa has been fantastic for helping people around the home, such as turning on lights and playing music, but they’ve started to infiltrate e-commerce:
- Approximately 20% of smart speaker owners now use it for shopping, including tracking deliveries, creating reminders, and ordering products.
With companies working to utilize SEO opportunities with smart speakers, this leaves many businesses looking to corner a market that needs quick access to online retail stores. Time is of the essence, and smart speakers like Google Home are paving the way.
An Increase in Rentals
There have been significant growth in P2P (peer-to-peer) platforms, and while e-commerce is riding high, there is still a significant problem with shopping online. Returns are causing problems in many ways, including:
- Customers telling lies by using returns windows to “expose” an e-commerce business on their social media page.
- Customers are using return windows due to the product not aligning with their morals.
It seems that rentals can be on the increase again. Once upon a time, we lived in an age of renting items like televisions or furniture, and this is something that many retailers are, again, looking to expand into. By offering consumers the opportunity to rent electronics, furniture, or even clothing, this is the perfect opportunity for businesses to expand their reach while also minimizing the potential for returns.
Going one step further than smart speakers, the shoppable TV ads rolled out by NBC at the end of 2019 helped viewers purchase items they saw on screen. If a customer is watching a show and likes the item of clothing a character is wearing, their programs connect to a mobile phone app to help customers purchase that item. Soon, this will be incorporated into smart televisions where the overriding goal is to turn shopping into a seamless experience.
Online vs. Offline: Which Is Better?
Which one is better for the average customer? While the AI components highlight a more seamless experience for customers and require less work for the business, there is a wide variety of resources to highlight each one is still relevant in the modern-day. But it’s this coming holiday season when the answer will become apparent.
- According to Forbes, the company Forrester saw online retail growing by 18.5% this year.
- The e-commerce growth was up to 14.7% last year, and it is predicted that it will go up to 25% or more.
- A survey conducted by Dynata for Redpoint Global found nearly two-thirds of the 1,000 adult shoppers surveyed (62%) planned to do all their holiday shopping online.
- Another survey from GfK Consumer Pulse found fewer shoppers (42%) planned to shop exclusively online.
Do you want some quick new online states for 2020?
Checkout: 20 Online Shopping Statistics for 2020
The jury is still out for this year, but we can safely say that online and offline shopping and still at loggerheads with each other, but with exciting changes on the horizon, the future looks bright for retail.