Thursday, February 22, 2018

Commerce Circa 2018

Strategy / Mobile

We’re at the time in the year when all the posts wrapping up the holiday trends of 2017 are finally beginning to dissipate. This gives us time to see the future of 2018 clearly. What’s on the horizon for commerce in 2018? We recently attended the National Retail Federation (NRF) in New York City and my colleagues and I had many takeaways from the event. Here are my thoughts on what I expect to see through 2018 (and what I hope I won’t see more of, too):

  • Traditional retailers will continue to face challenges. But we look at see this as a positive thing—it leaves room for creative and innovative solutions. By all appearances, the holiday season was stellar across all segments, demographics and geographies in the US. Consumers are optimistic about the future. Retailers are doing a much better job of meeting customers where they want to buy. I foresee growth and comebacks in speciality retailers in particular. Target, Walmart and others will continue to slug it out with Amazon for mass market appeal.
  • Which leads us to omni-channel improvements. Traditional retailers are getting much better at making them. Investments are beginning to pay off. Consumers will be more likely to engage in behaviors like shopping online and picking up in-store. Online experiences will become more consistent across all digital channels. In-store technology that will better support omni-channel is maturing and will see more rapid adoption.
  • Amazon will continue to grow and dominate. Their holiday numbers are mind boggling. But, there was room for other retailers. Amazon will expand into new physical retail markets – which ones are anyone’s guess. But, expect their square footage in physical stores to grow massively in 2018 through some type of acquisition. They will also continue to grow their private label business and B2B businesses, for sure. Marketplace sellers will also grow as more manufacturers want to join the Amazon party directly to better control their brands and pricing.
  • Speaking of B2B, that’s a hotspot for digital commerce right now. Based on work we are doing with clients from aerospace and industrial manufacturers to medical, the board room has finally gotten the message that its time to invest in digital to avoid a slow (or fast) erosion of growth.
  • In B2B – beyond digital commerce, it’s all about improving self-service and customer engagement. Portals, dashboards and reporting tools, automated workflows, and improved visibility into status and supply chain are going to be large areas for investments.
  • Native apps will continue to thrive. This is not just for online shopping, where responsive sites today are sometimes a retailer’s preferred experience over native apps. I’m talking about loyalty apps, AR, games, and any other type of app that will drive more engagement with target customers. Our colleagues at Raizlabs have already seen this with Macy’sBloomingdale’s and Rue La La and we expect other B2B sellers to rediscover the utility and value for apps in differentiating themselves from Amazon and other competitors.
  • Conversational commerce will continue to grow with Amazon and Google leading the way, by making devices more capable of helping shoppers find what they are looking for rather than just reordering the same merchandise again. The emergence of true virtual assistants came to market in 2017 via voice technology and it’s only up from here. Those virtual assistants will seek and aggregate information and data that will then be presented back with insights and eventually recommendations; customers will begin interacting via voice in a similar way to how they interact with web browsers. Stay tuned for HUGE growth in this area over the next 1-2 years.

I’d be remiss to not also add some things that I hope will be gone by the end of 2018.

  • Perpetual discounting. Retailers need to find a better way to engage customers than simply offering a new discount every day.
  • Barraging buyers with emails. As above, find a new way to engage with me. I’ve had trouble this holiday season even unsubscribing fast enough to avoid the daily barrage. Let’s hope that retailers find a better way to utilize email marketing across platforms of desktop, web, and mobile in a way that’s engaging and encourages retention.
  • Non-responsive sites. More than 50% of online shopping this season was on a mobile device. The investment in a more modern and user friendly user experience is worthwhile.
  • Online stores that are not protected. I found myself shopping and ready to buy on several stores this past fall and winter,only to realize their sites were not really secure. They lost my business. In one case, I emailed the retailer and suggested a solution for the problem, because I really wanted to make a purchase. But, I never received a response, the site still is not secure and I’m forever not a customer.
  • Entering credit card numbers on a mobile phone at checkout. The sooner we adopt electronic payment methods like Apple Pay, the faster companies will see an increase in mobile conversion rates. Not to mention, it’s a whole lot more secure for buyers.

If you’re interested in talking more about digital commerce and what problems we can provide innovative solutions for, get in touch.

Dale Traxler is Vice President of Commerce Solutions at Rightpoint. Follow Dale on Twitter and LinkedIn.