If you thought you knew everything about digital commerce, well, you were wrong. But, whether you want to participate in digital business, you need to stay on top of changes in the digital world. Today, we want to provide you with a Deloitte Digital report about the Digital Commerce Global Summit. Let’s start!
Retailers breaking up with third-party retailers
Some companies decided to leave hypermarkets and stationary shops. For example, Yeti did such a thing with Lowe’s. Instead, they made their new “optimization” strategy, to reduce the wholesale base to fewer than 3000 independent accounts. It’s because they want to manage inventory allotments better, improve merchandising, and bolster margins by selling direct to consumers.
So, Yeti left Lowe’s to focus on DTC (Depository Trust Company) and key wholesale accounts, as they want to build strong bonds with them.
Additionally, digital’s share of total retail sales remained at 19.1% in 2021 despite post-pandemic habits reverting back to the mean.
Digitally native brands are opening owned shopping experiences
DTC is going fully vertical. Recent data from Placer.ai, shows that DTC brands are opening stores faster than before the pandemic began.
As well, brands such as Warby Parker, Allbirds, Theragun, and Everlane are positioning themselves to show direct relationships with consumers, more control over the experience, and higher margins by cutting out third-party retailers.
However, malls are courting them, hoping to fill the void left by ailing traditional retailers.
Additionally, as America is saturated with retail and regions move toward mobile commerce-forward models, old retailing models will give way to new ones.
The connected mall strategy
Nowadays, malls should be considered an operating system: like layers of retailer tools and consumer efficiencies for retailers.
The example system strategy is:
- an inventory tracking system,
- a third-party marketplace,
- a mobility partner for last-mile delivery,
- a CRE acquisition partner.
Perhaps, these malls will become service providers to existing retail leasing partners.
Changes in advertising – Apple’s update
With first-party data, Apple is building a content fortress.
The company could join Meta as a go-to in DTC performance marketing. Apple’s ad products would presumably include targeted ads in native apps, revenue sharing with third-party app developers, in-game ads, and even opt-in for home/lock screen ads.
Apple is so well suited to capture Meta’s share of spend.
By 2027, Apple will be third in the digital advertising space behind Facebook and Google. First-party data will drive the next wave of advertising and sales.
Meanwhile, businesses in the United States are in a race for audiences; they build, acquire, or market to those who have them. When more companies pursue first-party data, audience development will become one of the most sought-after skills in the market.
Time of QR codes
At the top of the funnel, QR codes will also become a top method of collecting first-party data. For example, during the Coinbase Super Bowl advertisement in 2022, 20 million QR codes were scanned by Americans in just 60 seconds.
It was one of the best direct marketing ploys and first-party data collection opportunities in history.
source: Digital Commerce Global Summit report from Deloitte Digital
Growth in proximity payments eCom adoption in the U.S.
The United States takes 8 place, for mobile payment adoption, behind:
- China,
- South Korea,
- Vietnam,
- Norway,
- the United Kingdom,
- India,
- Spain.
As an example, China’s eCommerce penetration was 39.5%, while America’s was 17.7% (data from August 2021). By simplifying peer-to-peer transactions, businesses of all types can become more sophisticated and more accessible at the same time.
source: Digital Commerce Global Summit report from Deloitte Digital
What’s more, the USA will reach 30% eCommerce as a percentage of retail by 2027, and retail space per capita will drop to 16-17 square feet.
Malls will facilitate eCom returns to drive foot traffic
As of April 2020, Statista research shows that warehousing logistics occupied close to 10 billion square feet of industrial space. During the holiday season, the number of eCommerce returned orders raised to close to 30%. Comparatively, about 8-10% of store purchases were returned.
Nevertheless, as malls become desperate for new business, reverse logistics providers are expected to fill the gap.
Summary
A lot is happening in the eCommerce world. From changes to vendors, and advertising, to larger online purchases and returns as well. In addition, shopping centers are looking for new ways to re-occupy their space.
There are many ideas for malls; some of them will succeed, and some will not, of course. We only need to observe changes and quickly respond to customer needs. We hope this report will help you with that!
