Communication Services

Emerging Trends In Ecommerce – 2023

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<p style="text-align: justify;">Have you heard of the term Headless Architecture?&nbsp;</p><p style="text-align: justify;">No, it&rsquo;s not a team of people working without their heads (pun intended), but a terminology used to define a CMS (Content Management System) that only has a backend without a predefined frontend making your website more flexible and maintainable.&nbsp;</p><p style="text-align: justify;">There are so many similar developments surrounding the entire ecosystem related to e-commerce, and these will be adapted faster than anyone can imagine.&nbsp;</p><p style="text-align: justify;">Let us look at five such emerging trends that are going to catch everyone&rsquo;s attention in 2023</p><p style="text-align: justify;">&nbsp;</p><h2 style="text-align: justify;"><span style="font-size: 14pt;">Subscription </span></h2><p style="text-align: justify;">Prominently adopted by many businesses and consumers, subscription to a service or product is emerging as the most preferred concept. It not only helps businesses retain their customers but also helps consumers get uninterrupted supplies of things they use regularly.&nbsp;</p><p style="text-align: justify;">As per the data shared in the e-book published by Razorpay (online payment solution provider), subscriptions can boost revenue by up to 37% and reduce churns by 8%. The subscription model has a lot of other advantages:</p><ul style="text-align: justify;"><li>It is totally tech-driven, and there are many extensions and plug ins available to start with</li><li>It helps in pushing the LTV (Lifetime value) of a customer</li><li>It applies almost to any range of products or services a business provides to its customers&nbsp;</li></ul><p style="text-align: justify;">&nbsp;</p><h2 style="text-align: justify;"><span style="font-size: 14pt;">Conversational Commerce </span></h2><p style="text-align: justify;">Another concept that is being widely used by small businesses is conversational commerce. This can be defined as a process of interacting or converting a visitor into a transaction on the Web/App or any other conversation platform through live chat, chatbots, messaging apps, and voice assistants.&nbsp;</p><p style="text-align: justify;">Spending on <a href="https://www.statista.com/statistics/1273227/conversational-commerce-channel-spending-globally/" target="_blank" rel="noopener">conversational commerce worldwide</a> is expected to be more than $250 billion by 2025. Moreover, changing search and shopping patterns makes it evident that conversational commerce is the way of the future.</p><p style="text-align: justify;">Multiple tools, platforms, and partners are available, which are effective in the quick implementation and execution of conversational commerce. It is extremely important to identify the objectives a business is trying to solve through this concept along with the pros and cons attached to same.</p><p style="text-align: justify;">&nbsp;</p><h2 style="text-align: justify;"><span style="font-size: 14pt;">Customizable Products and Personalization </span></h2><p style="text-align: justify;">Customization and personalization in product offerings can help in better conversions. Millions of customers shop online, and all have their own preferences for a product. If your portfolio includes services, it becomes even more important to customize the same as per customers&rsquo; preferences. This can be done at different levels starting from product features to packaging.</p><p style="text-align: justify;">Several surveys, gamification activities, and quizzes on the website/app can help any business identify the customers' likes and dislikes on which customization and personalization can be offered.</p><p style="text-align: justify;">&nbsp;</p><h2 style="text-align: justify;"><span style="font-size: 14pt;">Increased Adoption of Artificial Intelligence </span></h2><p style="text-align: justify;">Businesses are widely using AI for virtual assistance and voice-related functionalities, but there is a huge scope for its implementation in all segments of e-commerce business &ndash; engagement, marketing, supply chain and others.</p><p style="text-align: justify;">Artificial Intelligence and machine learning can be utilized to send targeted communications to the audience, unlike the traditional method wherein each customer is overloaded with information. It can help improve search experiences (search is the most common starting point for customers) and automate product recommendations and communications basis consumer behavior.</p><p style="text-align: justify;">Many organizations are using AI to optimize customer acquisition costs and last-mile deliveries. Flipkart effectively used machine learning to identify and solve challenges related to customer addresses with a 98% accuracy rate.</p><p style="text-align: justify;">&nbsp;</p><h2 style="text-align: justify;"><span style="font-size: 14pt;">Visual Commerce </span></h2><p style="text-align: justify;">With the increasing acceptance of online shopping as a concept, customers are ready to experiment and buy almost everything online. This is where visual commerce can help. Certain products can only be bought once the consumer has experienced the look and feel of the product&mdash;technologies like Augmented Reality help create real-life experiences at home.</p><p style="text-align: justify;">Parallelly, product reviews with images/videos and other user-generated media directly impact and influences customers&rsquo; behavior to try and purchase a new category of products online.</p><p style="text-align: justify;">As per statistics, 79% of the customers give equal importance to a high quality and authentic review as they would to a personal (word of mouth) recommendation.</p><p style="text-align: justify;">&nbsp;</p><h2 style="text-align: justify;"><span style="font-size: 14pt;">Final Thoughts</span></h2><p style="text-align: justify;">So many big and small things are happening in the e-commerce ecosystem, and it is too hard for any business to catch up that fast. The need to develop sustainable packing solutions, prioritize smart pace for scale-up rather than fast pace, invest resources in live-shopping experiences, and integrate online-offline customer experience are also important to the success of an e-commerce/omnichannel business.</p><p style="text-align: justify;">It is always imperative that a business needs to identify and fight its own battles. Prioritizing trends that directly resonate with the target audience and are closely related to organizational goals would be helpful for any business &ndash; big or small.</p><p style="text-align: justify;">&nbsp;</p><p style="text-align: justify;">&nbsp;</p><p style="text-align: justify;">&nbsp;</p><p style="text-align: justify;"><span style="font-size: 10pt;"><em>This article was contributed by our expert <a href="https://www.linkedin.com/in/kunaldhooper1011/" target="_blank" rel="noopener">Kunal Dhooper</a></em></span></p><p style="text-align: justify;">&nbsp;</p><h3 style="text-align: justify;"><span style="font-size: 18pt;">Frequently Asked Questions Answered by Kunal Dhoope</span></h3><p style="text-align: justify;">&nbsp;</p><h2 style="text-align: justify;"><span style="font-size: 12pt;">1. What factors will help define the future of e-commerce over the next five years?</span></h2><ul style="text-align: justify;"><li><span style="font-size: 12pt;">Changing digital ecosystem</span></li><li><span style="font-size: 12pt;">Readiness of traditional businesses to transform themselves digitally</span></li><li><span style="font-size: 12pt;">Approach that solves niche problems and move towards sustainable e-commerce (both environmentally and economically) would define e-commerce in the next five years<br /></span></li></ul><p style="text-align: justify;">&nbsp;</p><h2 style="text-align: justify;"><span style="font-size: 12pt;">2. What is the impact of artificial intelligence on online business?</span></h2><p style="text-align: justify;"><span style="font-size: 12pt;">Artificial intelligence plays a big role in changing a customer's behavior. With technology, customers can find products much faster based on recommendations created because of previous buying history.</span></p><p style="text-align: justify;"><span style="font-size: 12pt;">Moreover, organizations using AI diligently can cross-sell and upsell more. Automating entire buying and post-purchase processes through AI contributes towards optimizing costs and increasing conversions.<br /></span></p><p style="text-align: justify;">&nbsp;</p><h2 style="text-align: justify;"><span style="font-size: 12pt;">3. How is AR VR reshaping the world of advertising and marketing?</span></h2><p style="text-align: justify;"><span style="font-size: 12pt;">AR and VR as technologies are changing the way products are experienced by customers. Right from how a piece of furniture would look in a particular house to how an accessory or a piece of clothing would look on the customer - it is all covered. </span></p><p style="text-align: justify;"><span style="font-size: 12pt;">It provides the necessary guidance and confidence in a customer's purchase decision and facilitates the entire experience from the comfort of home.&nbsp;</span></p><p style="text-align: justify;">&nbsp;</p><h2 style="text-align: justify;"><span style="font-size: 12pt;">4. Why is conversational marketing important?</span></h2><p style="text-align: justify;"><span style="font-size: 12pt;">Penetration of social media and other media apps has led to massive changes in how customers behave on the internet. The same behavior is expected by consumers when it comes to online shopping.</span></p><p style="text-align: justify;"><span style="font-size: 12pt;">Conversational marketing is an efficient enabler of e-commerce for generating more orders/increasing conversions, capturing post-purchase feedback, and rewarding customers to generate LTVs.</span></p><p style="text-align: justify;">&nbsp;</p><p style="text-align: justify;">&nbsp;</p><p style="text-align: justify;">&nbsp;</p><p style="text-align: justify;">&nbsp;</p>
KR Expert - Kunal Dhooper