Last updated: E-commerce evolution: Getting bigger and better every day

E-commerce evolution: Getting bigger and better every day

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Transcending boundaries and distance, e-commerce digitalized the world into a single platform, and, remarkably, e-commerce evolution only continues to accelerate.

From the initial spark in 1969 with the founding of Compuserve, e-commerce’s story is one of astounding growth fueled by incredible innovation.

Today, the online shopping experience not just replicates, but can sometimes exceed, the one offered by traditional brick-and-mortar shops.

Three innovations are key to e-commerce growth:

  1. Personalization: AI and machine learning made it possible to collate massive amount of data, make sense out of it and provide personalized shopping experiences. Feedback loops and dynamic adaptation to ever-changing consumer behavior enhance the whole customer experience.
  2. Omnichannel: The rise of the internet enabled the emergence of social networks, which was further boosted by mobile devices. Social media is embedded in our daily activities. According to a Google report, almost 85% of the consumers begin their buying journey on one device and continue on another. That trend mandated seamless integration between online and offline sales channels.
  3. Secure payment: Digital wallets and seamless electronic fund transfers have paved the way for a hassle-free payment experience. Paypal is the pioneer but Google Wallet, Apple Pay and many other mobile wallets are now on user devices. Increasingly, blockchain technology is making these transactions safer and faster.

E-commerce evolution: B2C led the way

In the early days, e-commerce was mainly driven on by the business to consumer business model, with retail as one of the early adopters. Apart from novelty, convenience played a major role in driving demand. Multiple players entered the field, intensifying the competitive landscape. Companies started to distinguish themselves through wider product selection and more innovative services.

After retail, the service sector was the next driver of e-commerce growth. There’s a wide range of services currently offered through the internet, including banking, insurance, travel and hospitality, education, media and entertainment, jobs and career sites, real estate, and broker services.

B2C e-commerce will continue to skyrocket. The global B2C e-commerce market, valued at USD 3.67 trillion in 2020, is expected to expand at a compound annual growth rate of 9.7% from 2021 to 2028. Growing digital dependency, the convenience of online shopping and a fast-growing digital population will drive growth.

In 2019, the number of internet users worldwide stood at 4.13 billion, which means that more than half of the global population is connected to the web. This isn’t just changing consumer behavior; it’s shaping the world economy at large.

B2C businesses today need an e-commerce solution with AI capabilities, which allow them to launch online stores in a flash. Plug-and- play with minimum coding and low maintenance are key requirements, along with a progressive web store optimized for mobile, tablet and desktop, which enables companies to create their own intuitive mobile apps in one click.

COVID sends e-commerce into hyperdrive  

The early days of global pandemic caused massive disruption in global supply chains, putting e-commerce to the test. With steep demand for essential goods such as groceries and personal care, online retailers answered the call.

By May of 2020, e-commerce transactions reached $82.5 billion — a 77% increase from 2019.

Under normal circumstances, it would have taken four to six years to reach that number. As we continue to fight the pandemic, supply of essential goods is the least of the concerns for most of us, largely thanks to e-commerce.

Evolution of B2B e-commerce 

The pandemic forced B2B companies, which preferred in-person sales, to look for more digital options. This gave rise to more B2B e-commerce solutions, which redefine buyer-seller interactions. B2B e-commerce is now much more transparent, efficient, and swift.

The other major factor in B2B e-commerce growth is that 44% of millennials make buying decisions, while 33% make recommendations or otherwise influence the purchase process. The technologically adept millennial B2B buyer is calling the shots.

The market potential of B2B e-commerce is huge. Statista predicts B2B sales will reach $1.2 trillion by 2021. Globally, the B2B ecommerce market was worth $12.2 trillion in 2019, having grown from $5.8 trillion in 2013. Double-digit growth is predicted for B2B ecommerce sales through 2024.

For B2B e-commerce to fulfill its potential, companies need an e-commerce platform with these capabilities:

  1. Robust and flexible: Many companies operate in multiple business models, from B2C to B2B to B2B2C and various  combinations. The solution should address all such scenarios in a single platform, providing flexibility to opt for headless commerce and traditional e-commerce and the ability to scale up without having to upgrade.
  2. Integration: Easy, seamless and real-time integration with existing cloud and on-prem, legacy applications.
  3. Omnichannel personalization: An omnichannel platform with cloud-native architecture to provide personalization through context-driven services to help define customer segments based on intuitive conditions.

Full steam ahead with voice commerce, AR, and blockchain

As they say, what got you here won’t get you there. If we look at the big picture, e-commerce is still fairly new, yet the future holds endless opportunity. Success will depend on how we’re able to meet ever-changing buyer preferences.

This is only possible through continuous innovation. Some of the trends which will drive these innovations in the future include:

  1. Voice search & zero UI: With more and more households adopting voice assistants, voice commerce is on the horizon. This has created a new gateway to consumers and offers the opportunity to establish and integrate a company into the consumer’s everyday life. Contact-less designs will become a preferred channel.
  2. Augmented and virtual reality: In order for e-commerce to fully replace brick-and-mortar buying, the whole shopping experience needs to be more intuitive, friendly, and satisfying. This is where immersive technologies like augmented reality and virtual reality (AR/VR) will help.
  3. Blockchain: Blockchain technology offers a range of capabilities that provide a lot of transparency in the financial and logistical aspects of business, but also allows consumers to have more control over their transactions. That helps build trust between the buyer and seller, which is essential for e-commerce success over the long run.

Better.
Faster.
Amazing every time.

A CX that drives loyalty + bottom lines starts HERE.

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