E-commerce started to ramp up in the 1990s as more consumers gained access to home internet service. Since then, the industry has grown by leaps and bounds. The way consumers experience e-commerce today is strikingly different from the industry’s humble beginnings. Online shoppers enjoy more dynamic interactions, flexible delivery options, and personalized choices.
Like other industries, e-commerce is constantly evolving and innovating to ensure success. Without these changes and developments, companies and products might fail to meet consumers’ new expectations and demands. As the e-commerce industry continues to make strides in serving customers’ needs, these four innovations are making waves.
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1. Customer Retention Tools
“If you build it, they will come” may be a popular movie quote. But when it comes to executing a profitable e-commerce strategy, that saying doesn’t always prove true. Simply having an online store won’t guarantee sales or customer loyalty. Complicated digital checkout processes, inadequate FAQ sections, and a lack of personalized experiences can turn people away.
Building online trust and loyalty is more complex than it looks. With seven out of 10 digital shoppers abandoning their carts, businesses are turning to retention marketing strategies and tools. Strategies and tactics that seek to reclaim abandoned cart revenue represent one example. Similar to service recovery methods, online customer retention tools attempt to re-engage customers and target reasons they’re turning away.
Some consumers may be unsure about the price and need more of an incentive. A loyalty or subscription-based discount might convince these customers to buy. Other people could have online security concerns and want reassurance they can check out anonymously. Still others might be unsure of a store’s return or shipping policy. More information and curbside or expedited delivery options explained via email may resolve those concerns, sealing the deal.
2. Expanded Delivery Options
One of the drawbacks of online shopping is that consumers have to wait for their purchases to arrive. In some cases, this waiting period can become a barrier. Certain consumers may want their merchandise sooner or decide going to a local store is better. Online retail giants reinventing e-commerce delivery options and shopping experiences are also shifting consumers’ expectations.
Shoppers are increasingly accustomed to next-day shipping options at zero or low cost. Matching these expectations may cause strains for online businesses and retailers without extensive supply chain networks. In response, many are offering same-day store pickup at no cost or same-day delivery through partnerships with other companies. For instance, retailers are working with food delivery companies and independent contractors to reduce shipping times.
Other developments being tested include drone delivery and self-driving vehicles. With supply chains using more technology, the accuracy and timeliness of product deliveries will likely improve. As waiting periods shrink from a few days to a few hours, they will become less of a barrier. More online retailers will satisfy consumers who crave immediate gratification.
3. Virtual Shopping Experiences
A downside to online shopping is the inability to try on products and see how they’ll look in real-world environments. This isn’t an issue for items like batteries or household cleaning supplies. But when it comes to things like clothes and furniture, shoppers want reassurance they’ll be the right fit.
Some online retailers offer try-before-you-buy and convenient return options to help consumers get over this hurdle. However, this may not be enough to convince some shoppers that it’s worth the hassle. Instead, virtual and augmented reality are becoming game changers for customers who want to experience products before they buy them.
A global consumer insights survey revealed that 32% of shoppers bought products after using virtual reality. These shoppers used VR to test out items before committing. Examples include seeing how furniture will look in their home and trying on clothes with personalized avatars. AR and VR make it possible to mix real and digital environments, recreating in-person shopping experiences from anywhere.
4. More Sophisticated Personalization
Yet another barrier for the e-commerce industry is replicating the personal touch consumers get from in-person store visits. Artificial intelligence can substitute for some of that by looking at individual shoppers’ past behaviors and purchases. AI and the algorithms built on this technology are becoming ever more capable of personalizing online shopping.
Current algorithms and technologies may show product recommendations, offer personalized discounts, and automate digital communications to drive sales. But as AI and its algorithms evolve, the e-commerce industry will be able to fine-tune its personalization efforts even further. By analyzing individual behaviors and prior activities more precisely, artificial intelligence can more accurately determine buyer personas.
Instead of algorithms just predicting what products someone is likely to buy, AI may interpret a buyer’s personality. For instance, is someone going to find frequent email communications and app notifications a nuisance? If so, the algorithm could adjust the frequency to ensure that shopper only gets information they want to see. With this level of personalization, online retailers may prevent churn and increase customer satisfaction.
The Future of Online Shopping
As an industry, e-commerce continues to grow as more consumers realize the benefits of online shopping. But increasing competition and tech-driven developments are raising the bar on shoppers’ expectations and what convenience means. Consequently, just keeping up with these demands may not be enough. Retailers that find new ways to overcome online shopping barriers will stand a better chance of success.