What are your ecommerce growth plans for 2017? Are you expanding into more product categories, re-designing your website or, perhaps, going international?
Whatever your plans are, it’s good to keep in mind some of the biggest ecommerce trends we’re expecting to see in 2017.
As more shoppers adopt a habit of ordering products digitally, online retailers will be competing even harder to attract customers, convert them, and keep their loyalty. We prepared a roundup of the biggest ecommerce trends predicted to dominate 2017 to help you prepare your ecommerce strategy.
1. Ecommerce will continue fast-pace growth
It might seems that everyone and their great aunt shops online nowadays. Afterall, 53% of global internet users shopped online in 2016. But ecommerce still accounted for only 8% of the total retail sales in the US and 14% in the UK in 2016. This means there’s still lots of room for growth in getting consumers to do their shopping online.
According to predictions by Forrester and eMarketer, online spending in the US is expected to reach $385-$440.4 billion in 2017. Online retail sales will increase not just due to the growing number of consumers who shop online, but also due to the increase in online spending. British consumers spend on average £1,050 a year on online shopping. In 2016, an average online shopper in the US generated $1,630 in online revenues, and this figure is expected to reach $1,734 in 2017.
The demand for ecommerce grows as shoppers change their habits. Only 20% of purchases in the US take place entirely in physical retail (including product research and browsing). 42% of purchases are purely online, as consumers reach out to online retailers to scout the best prices and offers. A big portion of this shift in shoppers’ habits and expectations can be attributed to Amazon, which remains the leader in online retail sales (and will continue to do so in 2017). It accounted for 60% of all online purchases in the US in 2016. Online retailers will be expected to match Amazon’s shipping efficiency and seamless online experience to remain competitive in 2017.
2. We’ll see new tech solutions for ecommerce
As ecommerce grows, so will the market for tech solutions for online retailers. In 2016, the market for marketing tech for ecommerce boasted with over 3,500 providers. 76% of online retailers in the UK consider innovation to be a business priority. This number is expected to grow in 2017, as ecommerce matures and there is a growing demand for tech that specialize in niche solutions in ecommerce.
Some of the most sought-after ecommerce solutions in 2017 will focus on improving customer experience, user-centric personalization (both on-site and off-site), real-time and predictive analytics, conversion rate optimization, and rich interactive content. Online retailers will look into solutions that can offer deeper insights into consumer behavior and track consumer engagement and conversions across channels. Consumers become quickly accustomed to innovative approaches to online shopping, so ecommerce retailers will need to continuously explore new tech that delivers convenience, comfort, and exceptional experiences to customers.
3. Conversion rate optimization will be top interest for merchants
According to ecommerce report by Monetate which analyzed 1.9 billion shopping sessions in 2016, the average global conversion rate on ecommerce sites in 2016 varied between 2.5-3%. Add-to-cart rates ranged 8.6-9.3% globally throughout 2016. With over half of shopping sessions ending without a purchase on ecommerce sites, merchants will focus their efforts in 2017 on optimizing their stores to bring in more conversions.
Retailers are also expected to invest $23 billion in online advertising and digital marketing by 2020. They’ll be looking to get higher conversions from these campaigns. Reducing frictions in the shopping journey and improving conversion rates will continue to be a priority for online retailers in 2017.
4. Black Friday and Cyber Monday will blend online
We’ve seen it this year, and we’re likely to see it again in 2017: the lines between Black Friday and Cyber Monday are getting blurry, as both shopping holidays move online. In the UK, Black Friday footfall on the high street fell by 8% in 2016, as many consumers opted to shop online. The preference for ecommerce shopping was evident also in the US, where shoppers spent a record $3.45 billion on Cyber Monday on a single shopping day (up 12% since 2015), beating Black Friday spending by 3.3%. In 2017, the divide between Black Friday and Cyber Monday as retail vs online events will be less important.
We’re also likely to see retailers try to stretch the buzz of Black Friday and Cyber Monday throughout the whole month of November. The so-called Cyber November gives consumers who feel tired (or just cynical) about Black Friday a chance to partake in the sales shopping without the pressure to do it on a particular day. It also gives small and medium-sized online retailers more space to compete with big brands on offers. This year, shoppers in the US have spent close to $40 billion online in November, up 7.6% compared to last year. In 2017, we’re expecting to see the rise of online shopping in November to continue.
We’re also expecting to see growth in sales on other shopping days throughout the year. Online retailers will look for additional opportunities to organize promotional shopping events to boost the revenues in months with typically low ecommerce activities.
5. Multichannel shopping will cause less frictions
By now we already know that consumers are chameleons. A shopper browsing the aisles of your boutique is likely to pull out a mobile phone and search your ecommerce store for more product information, then go home and order a product from their laptop. In fact, 42% of in-store consumers go online while in store to explore products and shopping methods further.
In 2017, we’ll see retailers and brands strive further to improve the experience and reduce frictions for multichannel shoppers. From shared inventories between physical and ecommerce stores that allow seamless product pick-up and returns, to more synchronized marketing messages, retailers will continue investing in multichannel experience. We’re also likely to see well-established names in ecommerce open physical retail stores or pop-up corners as a way to grow their market shares, following the examples of Asos and more recently Amazon Go.
6. Mobile shopping will pick up the pace
Despite high expectations, in 2016 we haven’t seen dramatic changes in the ecommerce conversion rates on mobile devices. Gartner predicted that by 2017, mobile commerce will represent 50% of digital commerce revenue in the US. However, the results so far are a bit less fantastic. According to research by Monetate, in 2016, global average conversion rate for mobile shoppers was 1.5%, compared to 3.5% for traditional devices such as desktop or laptop.
But that doesn’t mean that investments in mobile will be in vain. According to Forrester, consumers pick up their smartphone phones 150-200 times per day. A big portion of that time is spent discovering new ecommerce sites and brands, searching where to purchase products, comparing prices and delivery terms, as well as browsing through user-generated content about products.
By 2017, 60% of visits to ecommerce sites will come from smartphones. We’ll see big retail brands continue to invest in developing apps for mobile devices that make shopping on the go more smooth and secure.
Retailers will also invest in optimizing their ecommerce sites for mobile viewing to accommodate the habits of those who use mobile first to research their future purchases. For instance, in 2016, online retailers saw that 50% of traffic came from mobile, but 75% of sales took place on desktop. This Black Friday, despite traffic almost doubling for most retailers due to mobile visitors, 78% of carts were abandoned by those browsing on their mobile phone. This means that in 2017 we’ll see retailers invest in optimizing their checkout pages for shoppers on the go.
Google announced that its latest algorithm update will favor mobile-first sites, which is another reason to update your ecommerce site to be more mobile-friendly in 2017.
7. Design will focus on mobile shoppers
Even though mobile commerce is still in the early growth stage, consumers do use their smartphones very often to browse ecommerce sites. If the mobile experience is subpar, they’re less likely to return to the desktop version of the site to make a purchase. The importance to deliver a smooth experience across devices so as to get a share of customer’s wallet will be the driving force of the design trends we’ll likely to see in 2017.
Up until now ecommerce sites were designed for desktop-first users. Talks about responsive design were done in the context of adapting large-screen designs to mobile users. But in 2017 we’ll see a reverse trend. Ecommerce store design will be focused on mobile-first consumers and then adapted to large screens. This means identifying the most crucial elements for mobile users early on and then adding up items to that foundation to be responsive on desktop and laptop screens.
With this in mind, we’ll likely to see more ecommerce stores adopt design practices like hidden menus or hamburger menus, long scroll, page load-as-you-scroll, minimal negative space, as well as large visuals (images, buttons, icons, and videos) and vertical imagery. Retailers will also look into incorporating illustrations into their sites as a way to minimize the text and communicate visually with visitors on mobile screens.
8. Free shipping & fast delivery will be top priority
When trying to predict the future of retail, there’s a lot of talk about progressive strategies like, for example, the adoption of VR. However, before your store even gets the chance to impress shoppers with advanced tech, what consumers care about first and foremost is delivery – how fast is it and is it free?
Yes, while the press and the public muse about drone deliveries, in 2017, majority of online retailers will be still trying to figure out profitable ways to deliver free shipping and super-fast shipping in order to compete with the giants like Amazon. Data of past consumer behavior confirms this. 44% of consumers abandon their shopping carts if the delivery is perceived to be too expensive. Free shipping is so important that 58% of shoppers are willing to add more items to cart to qualify for free delivery and 83% are willing to wait longer for the items to arrive to their homes. To stay competitive in 2017, online retailers will need to seek ways to absorb the shipping costs (including delivery and returns) in order to motivate shoppers to place on order from their digital stores.
But free delivery is not everything. Timing is also a part of the equation determining the likelihood of purchase. In 2016, 29% of consumers said they would be willing to pay more and order more items for the same-day delivery, following the practice introduced by Amazon Prime. The soaring popularity of services like Postmates also fuels consumers’ demand for faster shipping. Next-day or same-day delivery is considered “fast” by 92% of shoppers in the US, and the threshold falls considerably for 3-5 day shipping. This means that in 2017, online retailers will also need to look into the fastest way to get the products from their warehouses to shoppers’ doorsteps. In-store delivery and partnerships with innovative delivery services will be on the rise.
9. UGC will be more important than ever in conversion rate optimization
As ecommerce industry adopts somewhat universal standards of online shopping (same shopping, delivery, and after-sales policies), retailers will need to look for additional ways to differentiate themselves to win new customers. While prices, promotions, and even shipping are relatively easy to match, it’s the content that will help online retailers get the competitive edge in the new year. In 2017, we’ll see more online retailers adopt user-generated content to increase conversion rates on their sites.
Shoppers who interact with UGC are 97% more likely to convert with a retailer than those who don’t engage. This is because 85% of consumers find UGC more influential than brand-made content. Consumers value UGC for its authenticity and crave to see products in realistic settings. 90% of consumers admit that comments and reviews made by other shoppers influence their likelihood of purchasing. 60% of customers aged 13-24 say that YouTube videos influence what they buy. For retailers, it’s an excellent way to repurpose creative content, add a dimension to the shopping experience and acknowledge customers.
While in 2016, we’ve seen brands lead the way in channeling UGC to their ecommerce sites, in 2017 multi-brand retailers will also adopt UGC. We’ll see more galleries of customer-made photos and videos added to product pages as a social proof that people buy the products and enjoy using them. We’ll also see more ecommerce retailers encourage customers to submit their own product reviews photos and videos to the site directly (instead of on social media only) in exchange for special perks.
10. Videos will be a must in ecommerce conversion rate optimization efforts
In 2016, much of the talk about video in ecommerce focused on shoppable videos and the convenience they offer to consumers browsing YouTube to discover new products and place an order with just a few clicks.
In 2017, the focus will shift to on-site use of videos in ecommerce and their role in conversion rate optimization. We’ve seen proof that product videos have the power to increase add-to-cart conversion rate 74% and boost customer engagement by 340%. While up until now the discussion revolved around the benefits of using videos in ecommerce, next year we’ll see online retailers seeks ways to optimize their videos strategies to bring more revenues.
In 2017, we’ll see more demand for tactics how to find the right videos for ecommerce and how to incorporate user-generated videos in online retail. As online retailers approach their video efforts more attention to detail, they’ll inquire more about practical things such as where to place videos in order to influence sales and how to A/B test product videos to affect conversion rates. We’ll see demand for smart solutions that have a proven track record of delivering higher conversion rates and sales with product videos. Online retailers will seek simpler yet highly effective solutions to bring videos to their sites and use them to grow sales.
And there you go, these are our top predictions for ecommerce trends in 2017. They’re based on past data and winning trends we’ve seen in the past twelve months. While there were big predictions that beacons and VR will take over retail in 2016, these trends didn’t really pick up with shoppers, so our predictions for 2017 remain modest and in tune with what we saw resonate with ecommerce so far. But there’s always room for surprises! Make sure to subscribe to our blog to stay in the loop in 2017 and keep your ecommerce game on top.