With a burst of silver confetti, glimmer of fireworks, and the annual drop of the crystal ball (or an oversized conch shell, peach, moon pie, 80 pound cheese wedge, or even a massive potato, if you’re lucky), 2015 came to a close. Retailers exhaled at the conclusion of the holiday peak season and are looking to the New Year with hopes of further growth and successes, likely with the help of targeted strategies and specialized technologies. After consulting the leading industry research companies and PFSweb subject matter experts, it is looking to be a big year for the following 2016 eCommerce trends…
Mobile (Smartphones & Tablets)
With the evolving platform of mobile wallets, payment behavior via digital devices is expected to shift and standardize, transforming mobile browsing into mobile purchasing. In 2016, eMarketer estimates that 37.5 million people in the U.S. (19% of smartphone users) will transact with their phones at the point of sale, which equates to an approximate 61% year-over-year increase. By the end of 2016, mobile payments are expected to exceed $27 billion. Gartner predicts that, by 2017, U.S. mobile commerce will have increased so much in popularity that it will account for 50% of U.S. total digital commerce revenue. This could largely be influenced by the introduction of larger screen sizes, as seen with the iPhone 6 and 6 Plus as well as the similar Android products, such as the HTC One and the Galaxy. Bigger screens and the popularization of simplified, one-touch check-out processes will supposedly assuage the hardship of thumbing one’s transactional information into a device.
Online sales are projected to account for 9% of all U.S. retail sales in 2016 and, according to Forrester, the increase in total spend per person is expected to jump from $1,207 to $1,738 from 2015 to 2016. With this perceived growth, it’s likely that retailers will want to employ more flash sales, which can prove challenging from an operations perspective. Billy Malady, PFSweb’s Area Vice President of Distribution, weighed in on the trend and spoke on the operational shifts that must be made in preparation for the order spikes associated with flash sales. Traditionally, eCommerce order volumes are higher on Monday due to the popularity of weekend ordering, and as the week progresses volumes decrease. However, flash sales disrupt this pattern by making any day of the week a high volume day. The distribution centers (DCs) must prepare, sometimes quickly, for an increase of the necessary packing materials, a larger headcount of employees, and an identification of SKUs that will be affected by the sale. “Flash sales add a level of volatility to an already unpredictable business,” commented Billy, “the DCs will require more involvement in order to stay in front of these sales; know the dates, know the volume, know the SKUs, know the expectations, and plan, plan, plan.”
Beacons are pieces of hardware that can be attached to walls or countertops within brick and mortar stores that use low-energy Bluetooth connections to transmit messages or prompts directly to a nearby smartphone or tablet. They also have the ability to pinpoint a customer’s location within a store. According to Retail TouchPoints, approximately 29% of retailers worldwide have already deployed beacon technology. In addition, over 54% of top retailers (defined as those with above average growth) believe that beacon technology will drastically change the way companies do business in the next three years (Retail Systems Research). Since beacon technology can enable proximity-based marketing to collect in-store feedback in real-time, retailers should be able to leverage sales of specific items that are close in proximity to a customer. For example, if a customer is looking through the jeans section, the in-store beacon could send him or her a discount on a specific brand of jeans with the hopes of persuading the consumer to make the purchase. These retailers should also be able to design store layouts that are more conducive for the needs of their shoppers by recording and compiling the most common walking paths as they enter the store, thereby improving the overall customer experience. In fact, Business Insider expects beacons to directly influence over $40 billion worth of U.S. retail sales in 2016 alone.
The data gathered from real-time analytics allows digital teams to personalize user experiences more than ever before. Randy Culpepper, the Digital Analytics and Data Science Senior Manager of LiveArea, The PFSweb Agency, offered his knowledge on the growing trend. As a shopper browses, real-time analytics can make predictive recommendations early in the engagement journey rather than waiting for preset logic triggers to respond. As the real-time data is collected, a content management system can deliver product information and recommendations based upon a user’s browser behavior, which, according to Randy, will ultimately “save a lot of ‘lost’ sales due to a user’s inability to locate a product within the site”. However, if a company doesn’t have the resources or time available to monitor the information in real-time, the valued data that could have been gained is forfeited. Those adopting the practice early on are also able to see benefits through the ability to provide immediate responses to social media activity.
With WhatsApp and Facebook Messenger growing closer to 1 billion monthly active users worldwide, it’s easy to see how the trend will be substantially important in 2016. Facebook has plans to add more services and marketing opportunities for brands in both Messenger and WhatsApp. In 2016, messaging will likely no longer be a way of communicating with friends, but also a way to talk to a computer system that can arrange restaurant reservations, order an Uber ride, send a gift to a friend for their birthday, book a flight back home for the holidays, or assist with virtually any task one could want. As the average smartphone user spends about 84% of their time in five apps or less, retailers want to engage potential customers within apps like Facebook because that’s typically where more time is spent and where an increasing number of purchases are occurring. Therefore, the transactional experience for the user will likely resemble texting or messaging a friend. Currently, Google and Facebook are the two giants squaring off to create the best and most widely used chat service (USA Today).
2016 is looking like a considerably important year for new developments and implementations of technologies that benefit consumers with convenience, ease of use, and discounted prices to entice sales. It appears as though it may be a year where automation and personalization will officially begin to reach the forefront of the customer shopping experience, simplifying the process and increasing the level of comfort while shopping online.