E-commerce: What challenges are on the horizon for 2019?
E-commerce may be a lot of things, but, one thing it certainly isn’t is slow. Having increased its global retail sales by nearly 3% since 2014 and with global revenue of $2.5 trillion, e-commerce is one of the fastest growing industries on the planet. This unprecedented growth is thanks, in part, to continued developments in modern technology and consumers on-going reliance and interest in smartphones and apps.
If e-commerce retailers continue to embrace new technologies, experts think that global e-commerce sales could reach close to $4.5 trillion by 2021. If that wasn’t exciting enough, retail predictions are also showing that by 2040, 95% of all online purchases will be facilitated by e-commerce retailers. These are breath-taking statistics that highlight just how lucrative the industry has become, as well as its potential longevity.
However, while it might seem like an unstoppable force, that doesn’t mean that those working within the industry will have an easy ride. Like most industries, e-commerce organisations can experience various challenges that seemingly change year on year. In order to remain relevant in such a competitive market, you need to be prepared. So to help you, here are our predictions of what challenges your e-commerce business might face over the next 12 months.
The threat of Amazon
Thanks to their user-friendly app/website, innovative shopping devices (such as Amazon Dash), and their ability to provide a speedy and affordable service, Amazon continues to sit at the top of the e-commerce food chain. At the end of 2018, they held a staggering 50% of the e-commerce market in the US alone which is looking to rise even more throughout the next 12 months.
If Amazon continues to embrace emerging technology to enhance their customer experience and journey, there is a strong possibility that customers may bypass search engines such as Google in favour of Amazon’s. This could, understandably, be catastrophic for other small and large e-commerce retailers alike. However, while your small e-commerce business might not be able to compete directly with a dominant force like Amazon, you can learn how to co-exist with them.
Spend this year establishing a product that meets a demand that you can sell to a niche audience. Amazon isn’t able to meet every demand from every niche out there, so you’ll effectively be filling in the gaps they can’t reach. Another way to compete in an Amazon world is by improving your shipping and customer service.
While you won’t be able to match Amazon’s same-day delivery option, offering discounted or free shipping can be a simple way to increase your customer's satisfaction rates. You can also improve your customer service by offering multiple ways of getting in touch, having a knowledgeable team to respond to queries and by cutting response times. In 2020, customer experience is predicted to become the biggest key differentiator between brands, so it’s worthwhile to start making improvements now.
Building customer trust
This isn’t necessarily a new challenge, but it’s one that is particularly important and remains relevant throughout this year. In July of last year, it was reported that 800 e-commerce sites, including Ticketmaster, had been targeted by cyber criminals who were attempting to steal customer’s credit card information. Despite there being major advancements in cybersecurity since then, customers are understandably wary about who they purchase from online.
Thanks to GDPR, customers are also more aware of their data and will now be more eager than ever to know that it’s sufficiently protected. With so much uncertainty in the air, it can be increasingly difficult for retailers to win the trust of nervous potential customers.
Thankfully there are a number of ways to make your customers feel more secure when shopping with you. The easiest option is to offer several payment types that the majority of customers recognise, such as credit cards, Apple Pay and PayPal. The logos of these payment types should then be displayed on the checkout pages and footers on your site. You can also invest in encrypted shopping card technology and fraud prevention geo-location software and switch to an HTTPS server to increase the security of your website.
However, reassurance from yourself is what the customer really wants in order to feel safe when buying from you. Be open and honest about your security safeguards, your returns policies and what your procedures are in the unlikely event of a website breach. These messages should be on your website and should also be repeated by your customer service team when necessary.
Providing an amazing customer journey
Giving your customers a smooth and memorable experience is something that your e-commerce site should be provided as a standard. There were many, once top, retailers who went into bankruptcy last year, including Toys R Us, HMV and House of Fraser. It’s not that consumers no longer want toys, DVDs or clothes, they are just finding them elsewhere via another retailer who offers them a better experience elsewhere.
If you want to succeed in 2019, you’ll need to put customer journey and experience at the forefront of your strategy. Did you know that seven out of ten carts are abandoned if the customer faces technical difficulties and having a slow website can increase abandonment by 75%? Reasons such as creating accounts, difficulty in editing baskets and a lack of inspiring visuals can also stop customers completing their purchase.
Analysing your customer journey is the easiest and most effective way of spotting anything that could be stopping your customers from making a final payment. You’ll need to consider the ease of navigation, efficiency of the site, technical issues, customer engagement and design to make sure your user interface is simple, attractive and accessible throughout. Don’t be afraid to get feedback from your customers either as they could offer first-hand insight into how to simplify the journey further. This analysis is something you will need to do regularly in order to remain competitive.
Also consider added extras for your website that are interactive and enable personalisation, as this is proving to be popular among today’s consumers. For instance, you can send promo codes to your customers to encourage them to buy the items in their abandoned carts or offer back in stock alerts so they never miss out on an item.
These are just a handful of some of the biggest challenges that we feel that e-commerce retailers could face this year. Being part of a landscape that changes as often as the weather can mean that it’s an uphill battle to remain competitive and engaging to your customers. But hopefully, this insight will help you get prepared for whatever the next year throws at you.