The world of eCommerce is bound by change. As technology evolves, so do the capabilities and functionalities e-merchants should use to enhance the online shopping experience. Consumers are also reaching maturity as digital shoppers, which undoubtedly leads to changes in their expectations.
We saw these two factors come into action in 2021 with social commerce, omnichannel shopping, augmented reality, and local delivery options being among the defining trends of that year. As we settle into 2022, how else could we see eCommerce transform in the coming year?
6 E-Commerce Trends For 2022
New ways to drive personalization
In the middle of 2021, marketing took quite a hit as Apple announced its iOS 15 updates. It allows users to opt out of email trackers and limits the use of mobile device IDs on iOS apps. A further blow to data tracking is on its way as Google will end third-party cookie support on its Chrome browser by 2023.
With roughly 82% of web advertisements relying on cookies, over 77% of websites worldwide having at least one tracking cookie, and email trackers helping to dictate message content, e-merchants urgently need to focus on other ways to capture data to personalized marketing content. We can, therefore, expect to see a rise in zero-party data collection methods.
Put simply, this refers to brands gathering data directly from their customers. However, getting consumers to give up their personal information is not an easy task, particularly as they become more protective over their data. Simple prompts for registration will not suffice. So, we expect 2022 to be a year full of creative methods to gather valuable data directly from shoppers.
Let’s take a look at some visionary ways leading brands have approached zero-party data collection to drive personalization.
Quizzes are a great way to tease out valuable information and also present them with highly tailored products from your catalog. Beauty brands Sephora and Dermalogica both use quizzes as a route to personalized recommendations.
Hair, Skincare, and Foundation quizzes on Sephora’s website lead customers to their perfect products.
Dermalogica puts a 21st-century spin on quizzes with their AI-powered skin analysis tool that examines their face via webcam to identify skin concerns and recommend suitable products.
Mavi, however, takes quizzes to a whole new level to optimize data collection and foster long-term personalization.
(Source: Octane AI)
Their Shop Quiz asks key questions that lead to personalized recommendations whilst also creating a buyer profile including their likes, dislikes, preferences, and more. Mavi very cleverly prompts participants to provide their email addresses for their results just before presenting the results page itself. It’s a huge win as synchronization with the participant’s email address will help the brand create personalized email marketing campaigns.
Social Media Polls
Instagram Stories in particular present the perfect opportunity for brands to get to know their customers, get feedback, and also lead them towards the right products. You may be surprised to read that a third of the most-viewed stories come from businesses. Hence, including a poll in an Instagram story is a sure-fire way to attain a treasure trove of data. That’s why many brands are already putting this tactic to use and will surely become a standard component of social media strategies in 2022.
(Source: Bazaar Voice)
Showing us exactly how polls will be used to drive personalized shopping experiences on social media is Nykaa. One of their Instagram stories featured a poll asking their followers to choose their skin concern. Upon answering, they were presented with a link to a product that addresses their chosen concern.
You may think a simple inclusion of an offer or discount is enough to convince visitors to give over their email address or phone number. It’s not. You’ll need to work a little harder than that if you want to get your hands on that. Remember, consumers are now super protective over their data and won’t hand over their information without a second thought. That’s why registration pop-ups will, by default, use a friendly, humanizing tone that puts consumers at ease and injects some fun into signing up.
100% Pure gamify their email registration process whilst also allowing customers to zero in on the type of content they wish to receive. Urban Southern uses a friendly tone that humanizes their brand.
The internet is about to enter a new phase. Gone are the days where data was held and controlled by a select few companies. Web 3.0 will focus on the decentralization of information. Together with leaps and bounds made in technology enabling information to be processed in a human-like way.
2021 saw tech news awash with terms like the metaverse, cryptocurrencies, NFTs, artificial intelligence, and machine learning. As companies turn their interest towards Web3, we can expect to see more eCommerce merchants embrace some aspects of it. In fact, the signs of this happening are already in the air.
NFTs and the metaverse meet eCommerce
Shopify is in the process of launching an NFT Beta Program for Shopify Plus merchants. This will allow businesses on the platform to mint and sell unique digital assets. At the end of 2021, Nike acquired an NFT collectibles studio.
(Source: Ralph Lauren)
We’re also beginning to see big brands step into the metaverse to try their hand at selling digitized forms of their products. Ralph Lauren recently collaborated with a global social networking and avatar simulation app to launch a virtual world where people can kit out their avatars with exclusive products from the clothing retailer.
Cryptocurrencies gain greater commercial support
Banks and payment platforms are paying more attention to cryptocurrencies. Mastercard announced that it would allow its partners to let their consumers buy, sell, and hold cryptocurrency in a digital wallet. PayPal is doing the same for its UK and US customers. Visa is set to dip its toes into crypto too by piloting a scheme that will allow purchases to be made using USD Coin.
Shopify merchants will also be able to jump on the cryptocurrency train thanks to a partnership between Binance and Alchemy Pay.
This could mean that 2022 will be a year of more widespread adoption of cryptocurrencies in eCommerce. And if this does happen, perhaps we’ll even see cryptocurrencies and digital tokens used in loyalty and reward programs.
AI and ML taken to new heights
Finally, in this new dawn of the web, we’ll see advanced utilization of AI and ML algorithms in eCommerce. This will manifest as the algorithms having an enhanced understanding of patterns in customer behavior, so much so that they can more accurately predict what shoppers will want to see or actions they are likely to take. Resulting in suitable adaptations being made as consumers move through the shopping funnel.
Sustainability is a must
Sustainability has completely moved away from being a buzzword to a genuine concern consumers have and expect businesses to address. According to eMarketer, protecting the environment is the leading concern of Gen Z adults. Plus, the vast majority of online consumers believe brands have a responsibility to implement sustainable practices.
As calls for action from consumers grow louder, we’ll see sustainability becoming a must-do for all businesses. These heightened expectations and intelligence around environmental issues urges brands to go beyond simple measures like reducing plastic use and find more substantial ways to be sustainable.
Nuuly Thrift is a resale marketplace where people can sell their used clothes from any brand. (Source: Retail Dive)
In a bid to ingrain sustainability deeper into business models, we’ll see more retailers turn to resale initiatives. In fact, Urban Outfitters debuted their resale marketplace, Nuuly Thrift, in fall 2021. IKEA now provides a service where they will buy back and resell customers’ used furniture. Plus, eCommerce giant, Amazon, is an example of just how much sustainability is non-negotiable for consumers. Widespread backlash over the company’s destruction of returned and unsold items caused them to allow third-party sellers to list returned and unsold items as used.
Live shopping gains more traction in the west
Already a huge craze in Asia - particularly in China where two-thirds of shoppers make purchases during a livestream shopping event - live commerce is set to be the new frontier in social commerce.
In the US, the livestreaming market was expected to reach $11 billion in 2021 and climb to $25 billion by 2023. In fact, a whopping 86% of companies plan to either increase or maintain their investment in livestream selling over the next 12 months. With conversion rates of up to 30%, it’s no wonder why brands plan to add this to their strategy.
Tommy Hilfiger hosts live shopping streams on their website and keeps their audience engaged with interactive polls. (Source: Flowics)
Steps towards live shopping in the west are already taking place. Amazon launched Amazon Live where celebrities and influencers curate their must-have products for viewers to buy. Plus, Tommy Hilfiger recently brought their livestream program to Europe and the US.
Infrastructure around live commerce on social media is also beginning to take shape. Both Facebook and Instagram have expanded their live commerce capabilities, allowing all Facebook Shop owners to host live shopping videos. They even have a best practices guide to help e-merchants get the most out of their streams. Tik Tok hosted a handful of special shoppable livestreams at the end of 2021. Its partnership with Shopify could soon see this becoming available for more e-merchants in the future.
As livestream shopping becomes more prominent, we’ll also see the rise of a new type of influencer - stream-fluencers. These are online personalities who are able to draw in a large number of viewers and drive a huge amount of sales.
Greater adoption of different payment methods
There are a couple of reasons why we’ll witness payment methods other than credit and debit cards becoming more dominant in 2022.
Firstly, Millennials and Gen Z-ers are beginning to take over the retail spending space. These generations of shoppers may not have the biggest pockets However, their thirst for keeping up with the latest trends means they are after convenient ways to purchase products which may be a little out of their price range. Buy-now-pay-later (BNPL) allows these consumers to easily buy the items they desire without being subject to high-interest fees. This has led to platforms like Klarna gaining record growth as now 30% of consumers use BNPL and a further 10% are interested in using it in the future.
It's not just consumers who benefit. Online stores with BNPL options can increase their average order volume by up to 41% and increase purchase frequency by 36%. With such great results, we’re sure to see BNPL being a payment option on the majority of eCommerce sites.
Another driving force in varied payment options is cross-border shopping. Consumers in different regions of the world often have varying preferences for methods of payment. For example, in Europe, local payment methods like iDEAL and Bancontact are favored. With cross-border purchases forecasted to make up 22% of online sales, savvy brands will be quick to add multiple payment options to attract foreign customers. Shopify has already taken notice of Shopify Markets providing support for bank transfers and local payment options.
The rise of direct-to-consumer (DTC) companies
The removal of the middle-man (wholesalers and third-party retailers) will be adopted by even more traditional retailers, and we’ll see more digital brands entering and maturing in this space.
DTC companies gained popularity as they are beneficial for both the customer and the retailer. Consumers can purchase goods at a cheaper price, and brands get to keep more of the money they make. Additionally, the DTC model allows consumers and brands to connect with each other on a more personal level. Brands can convey an engaging authentic persona, which is what Millennials and Gen Z-ers value.
Allbirds use social media to form a community united around sustainability. Rather than solely promoting their products, they thank their customers for helping to bring environmental issues to the forefront and display feel-good messages. Both of these drive engagement. (Source: Allbirds Instagram)
eMarketer predicts that in the US alone, 103.4 million shoppers will buy from a DTC business in 2022. So expect to see big-name retailers emulating this model and more native DTC brands reaching the upper echelons of eCommerce.
To find success in the eCommerce world, e-merchants must stay on top of the latest trends. The coming year will be packed full of innovations that will present excellent opportunities for online stores to maximize their potential. Start thinking of how your store could put these trends into practice so this year can be your best one yet.