It was the year that Amazon unveiled its delivery drones, the Cyber Weekend continued to exceed expectations, and Alibaba sold off its US ecommerce site just a year after launch. Online retail continued to dominate headlines in 2015 and with good reason; consumer demand for ecommerce has never been higher. In this article, we look at some of the biggest online retail trends of 2015 and how they’re likely to evolve over the next year.
The mayhem of Black Friday (and the weeks either side of it) quickly showed which retailers had upped their performance capabilities this year. Retailers whose sites remained operational reaped sales from happy customers who faced queuing systems and slow checkouts elsewhere. As well as heavier investment in performance and infrastructure capabilities - in many cases, prompted by the failures of Cyber Weekend 2014 - we’ve seen many more merchants advance their online customer experience. There’s also been a shift in ecommerce teams looking at user behaviours with more sophisticated tracking tools alongside standard web analytics platforms.
A wealth of new technology and data offers a bigger and better picture of customers than ever before. Dated customer profiles based on generic industry research are increasingly being pushed aside in favour of data-driven demographics that can create a truly personalised experience. Technology companies, and even some of the ESPs, are pushing the boundaries in terms of looking at actual customers for CRM allowing for far more effective automated, personalised marketing activity.
Personalisation remains a key focus for lots of merchants with retailers looking to push the boundaries around up-sells and product recommendations. Merchants such as Cowshed, Bargain Max, and Bjorn Borg are using personalisation (via Nosto) effectively this Christmas, illustrating the potential for other merchants.
Lastly, online retailers are investing more and more in mobile experience, beyond just making their existing site responsive. Lots of merchants are applying the same principles around optimising customer experience on desktop to mobile now, due to the shift in mobile traffic over the last few years. Where mobile was previously seen as a browsing channel, conversion rates and confidence levels continue to improve, making it hugely important to merchants in most verticals.
2. Content and commerce
For a long time, retailers became fixated on the need to replicate offline customer service online. For brick-and-mortar stores, in particular, it became a race to offer the same level of information and guidance that a customer could expect from an in-store assistant.
Although a trend that has been gaining momentum over the last few years, more retailers than ever are realising the value of content alongside commerce. We’ve seen much more adoption of content-orientated technology like Olapic and Chute, which allow merchants to publish social proof on product pages and are far more invested in content marketing campaigns. We’ve (GPMD) also implemented shoppable video for a new project we’re about to launch (which also features NOSTO), another trend that has powered up this year and is likely to grow into next year.
3. Agile technology
Lots of enterprise-level stores are moving to more agile platforms like Magento Enterprise and Demandware (as detailed here), which are far more feature-rich, omni-channel ready, and are more heavily focused on customer experience. Many large merchants have grown tired of legacy systems and non-agile platforms and are looking towards some of the more modern options to address the issue. Magento 2 also represents a big shift for its creators, and the new platform addresses a lot of the drawbacks of Magento 1 while promising to bring lots more features and functionality throughout 2016.
We expect next year to be a significant one for Magento, no longer part of eBay and a sizeable product update to take to market. Where previously Magento may have been considered the platform of choice for small to medium retailers, Magento 2 puts it firmly in the market for bigger retailers.
Part of its expected growth is fuelled by a rising number of retailers shedding their legacy platforms. Lots of big multi-channel brands who made their first steps into online are now paying more attention to their technology’s flexibility and potential, rather than generic out-of-the-box features. Equipped with smart developers and solutions specialists either agency-side or in-house, these retailers will soon streak ahead of their competitors.
4. Shift from agency to in-house marketing
Although not a new occurrence, one of the biggest continuing trends this year relates many retailers continuing to take marketing functions in-house, particularly search marketing, analytics, and even CRO.
As well as reducing reliance on third parties, retailers can then ensure their full team knows the brand, knows their customers, and can invest heavily in their skills. Although the benefits are clear (reduced overheads, consolidated product and customer knowledge etc), agencies often bring new perspectives and industry-wide knowledge to in-house teams, but it’ll be interesting to see how this impacts agency offerings, as well as consultants and contractors, who are often brought in as part of the process.
However sophisticated a retailer’s online user experience, customer loyalty can quickly be impacted by poor delivery, and standard 9am-5pm deliveries no longer fit with customers’ increasingly flexible lifestyles.
As with so many aspects of ecommerce, Amazon is leading the flexible delivery trend here in the UK. The sheer variety of delivery options, such as lockers, pick-up locations, one hour delivery (via Prime), multiple address delivery etc, is designed to meet the busy lifestyles of its customers. In 2016, we expect to see many more merchants testing new delivery schemes, especially with services such as CollectPlus and Doddle. John Lewis also reported that click and collect sales grew by 57% last year.
6. Direct to consumer
Another big trend we’ve seen from merchants this year is an increasing number of B2B merchants starting to sell directly to consumers. Companies with very traditional models, such as Hornby and Tissot, have recently ventured into d2c ecommerce for the first time.
Lots of larger FMCG retailers have moved to offering a direct sales route to their customers, although this trend started two or three years ago and just continued to grow in 2015.
Attribution remains one of the biggest challenges and general irritations of ecommerce professionals. Accurately attributing value to different marketing channels (and, even more challenging, brand marketing activity) is more of a science than an art these days, thanks to sophisticated modelling and marketing technology, but even the most advanced systems are unable to break down all of the flaws. Despite improvements in technology, I’d imagine this will carry over into 2016 and beyond.
Moving into 2016, I expect more need for agility, personalisation and scalable operations to help retailers keep pace with customers who won’t think twice about shopping with more visible, cheaper or more CX-orientated competitors.
Guest blog by Paul Rogers
Paul currently works as a Director of GPMD (a Magento agency) and Founder of Audited (an aggregated audit provider). Paul has been working in ecommerce and digital marketing for over 8 years and has worked with brands from all over the world. Paul also blogs about ecommerce on his personal website.