In our previous post about m-commerce, we looked at the data on the growth of e-commerce and the proportion of online retail and banking that has shifted onto mobile. In this post, we will delve a bit deeper into some of the trends that we think will shape m-commerce in the years to come.
Looking further into the future, there are several emerging technologies whose potential is only just being realised, such as artificial intelligence, chatbots, video, personalisation, augmented reality and the blockchain. Some or all of these will change the buying and selling experience in ways we can only start to imagine.
Global social media channels such as Instagram, Pinterest and Facebook now offer consumers additional ways to shop and this is likely to accelerate.
While Facebook has more consumer reach than other social networks, Pinterest and Instagram are preferred by many because of the visual appeal of their sites. In addition, while Facebook covers a range of topics, Pinterest and Instagram, which both offer one-click buying options, are more focused on hobbies and interests. Although Facebook does have a Marketplace section, it is largely a platform on which people can link up, exchange news, have arguments and socialise rather than shop.
China has several hugely popular social media platforms, and followers of online influencers can buy items or gift cash with their phones. Then there is Taobao, one of the world’s biggest e-commerce sites, owned by Alibaba. Businesses and individuals can create their own virtual stores on the platform, using Alipay as their merchant account. Think eBay, Etsy and Amazon Marketplace all rolled into one. At the last count, Taobao had 580 million monthly users.
A report from Technavio into the Global Social Commerce Market 2017-2021 claims that platform-holders such as Facebook, Pinterest, Tencent and Weibo are the key vendors in the global social commerce market and that social interaction platforms such as Snapchat are increasingly used for marketing products.
The company predicts that the global social commerce market will grow at a CAGR of around 34% by 2021 and claims that the rising use of social media advertising is identified as one of the primary growth factors for this market and that APAC will be the major revenue contributor to the social commerce market throughout the forecast period.
Pinterest’s “Gifts feed” features Product Pins with pricing, availability and buy links, while Instagram ’s sponsored posts have been highly successful. All this presents opportunities for retailers who can now use these sites not just for brand awareness but for lead generation.
Not only do these platforms offer greater opportunities for sales, through the ability to interact directly with customers, but also provide data which enables retailers to analyse in some detail information about customer buying behaviour.
Already becoming widely used in sectors such as HR, chatbots are likely to become routine in the retail industry. In today’s world, speed is of the essence, and shoppers want quick answers to their queries without having to spend time waiting for customer services to answer – and at any time of day or night. 48% of consumers would rather prefer to connect with a company through live chat than any other means of contact.
Retailers such as H&M and Starbucks are already leading the way and Chatbots will only get more sophisticated as AI allows them to predict what individual shoppers will want to buy. This helps with another trend – personalisation.
Customers are increasingly expecting an experience tailored specifically to them. This is partly a result of the rapid pace at which most of us live our lives – and because it is becoming increasingly possible.
Boston Consulting Group claims that retailers that have implemented personalization strategies see sales gains of 6-10%, at a rate two to three times faster than other retailers. By tracking past searches and buying history, retailers can suggest other products that customers may like, and remembering customer preferences – small things can add up to encouraging customer loyalty.
Retailers are also increasingly investing in Beacon technology – a way to track footfall within a store – to monitor buying behaviour.
While still in its infancy, this has huge potential for the retail industry. Sephora’s Virtual Artist app, for example, allows a customer to try on makeup virtually, and the potential for the use of this technology for fashion, spectacles, home furnishings and so on are obvious.
The initial experimentation with AR and VR technology led to lots of experimentation, and a predictable backlash. But slowly, thanks to developments like Apple’s ARKit, AR is finding renewed relevance.
In an age where voice recognition software really works, and apps such as Alexa and Amazon Echo are becoming more mainstream,, consumers increasingly want to be able to search for products using voice commands. This trend set to rise – by 2020, the of searches on Google using voice number will surpass 50%. For retailers, this means ensuring their products and services can be found via voice search.
Digital currencies including bitcoin and ethereum allow customers to buy directly using a type of digital wallet and companies such as Microsoft are already allowing payments by this method.
It’s clear that e-commerce and m-commerce are set for rapid growth, and that social media platforms and other new technologies will continue to develop to make the shopping experience more appealing. However, retailers should ensure they have a consistent brand across multiple channels. Customers may browse m-commerce applications, but many still want to go to a store to view the product before taking the final step to purchase, and the omnichannel model looks as if it will be the one to follow for a long while yet.
The future looks rosy for those who are willing to understand and adapt to changing customer preferences and demand for choice in terms of what to buy, how to buy and how to pay. What is certain is that if retailers are to succeed in the longer term, maintaining the status quo is not an option. M-commerce is here to stay and together with other new technologies, presents unparalleled opportunities. The retailers that embrace it are likely to be the ones that succeed in the brave new world of omnichannel retail.