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Top Takeaways from The Future of Commerce Trend Report 2022

There have never been as many opportunities in the ecommerce space, nor has there been as much competition. Plummeting ad spending returns pushes brands to prioritize customer lifetime value and promote brand loyalty. Additionally, the massive changes that 2020 brought to the retail industry are here to stay. And now that parts of the world are opening up, and consumers are craving opportunities to shop in person, they expect the buying experience to be consistent both online and off. What’s more, supply chains became the most talked-about aspect of commerce in the latter half of 2021. As a result, it’s unlikely that production, shipping, and fulfillment challenges will decrease in the months to come.

These are just a few facts from The Future of Commerce Trend Report 2022 created by Shopify. If you want to know more, be sure to read on!

Ecommerce trends in 2022

In the future, e-commerce will create 3 trends. The first is rising acquisition costs force brands to foster long-term relationships with their customers. 

Although retail business doors have reopened, ecommerce sales aren’t slowing, resulting in an influx of Direct-to-customers (DTC) brands competing for customer attention. It’s also essential that digital advertising costs eat up marketing budgets, putting performance marketing–heavy customer acquisition models in jeopardy. As more businesses are online, it’s harder and harder to find new customers. Because it’s so easy to start online now, there are rising customer acquisition costs. Paid ads are getting really expensive. However, 41% of brands plan to increase their paid and organic search investment. Businesses are overcoming the competition by investing in brand building, which increases customer lifetime value, boosts conversion rates in the short term, and attracts out-of-market buyers in a long time. 

The death of third-party cookies forces brands to rethink personalization – it’s the second trend. Consumers continue to demand personalized shopping experiences, even as regulations make data tracking harder and the most prominent players phase out support for third-party cookies. Brands innovate with first-party data, but personalization isn’t enough to create long-term relationships. Consumers are willing to share personal information with businesses that align with their identity. If companies want access to customer data, they need to do it in a way that builds trust. 85% of brands believe they’re offering personalized experiences, while only 60% of consumers seem to agree. Brand communities become crucial to building trust and brand equity and improving customer retention.

The last trend is new commercial opportunities emerging on the most powerful social platforms. Ecommerce activity congregates on social media platforms, from brand marketing to customer service to shoppable advertising. Brands build loyalty, not products. They need to develop their own DTC strategy and model to build a solid and independent brand. Diverse platforms and rapidly evolving features lend themselves to unique customer experiences, encouraging brands to reimagine consumer engagement. Video and live chat is making social commerce more sociable. It’s key to unlocking the power of social interaction. Leading brands focus on social-first approaches like behind-the-scenes live streams, video consultations, and personalized product recommendations.

Retail trends in 2022

If we’re talking about retail, we also have some trends here. The first one sounds: digitally native brands drive retail competition. 

Consumers crave the in-person experiences they’ve been missing, and brands are investing in experiential retail even though it could prove logistically challenging. DTC also includes sales through stores that you own. What few consider is that customer acquisition costs are typically lower in owned, physical footprints. But for it to work, the brand must be strong. Higher retail vacancy rates are leading to more favorable commercial lease terms that might lure digitally native brands to venture into the world of physical retail. In addition, 55% of brands say another top challenge will be increasing foot traffic to their stores and 81% of Gen Z consumers in the United States prefer to shop in-store to discover new products. Finally, rising digital advertising costs will cause many brands to look to physical retail as a form of advertising to lower customer acquisition costs. 

What’s more, the post-pandemic customer journey will bring about the next phase of omnichannel shopping. Brands must create experiences and build relationships with their customers that only omnichannel can offer to stay competitive. Building relationships with customers will be the number one thing, not only through your website but all channels. Your brand presence and message must be active and engaging across your website, email, and social. Whether it’s online or offline, consumer shopping expectations and buying journeys have changed and can start and end on any channel. To adapt to the next phase of omnichannel, brands must provide a consistent experience across channels.

The last retail trend is about consumer and employee expectations – they push brands to reimagine the retail staff role. Customer service expectations are higher than ever before, which means more responsibilities–and opportunities–for the store associate. In addition, retail employees demand higher pay and more options, so brands must reimagine the store staff’s role and compensation to attract and retain employees. Finding and having employees will be difficult if retailers don’t reimagine the staff’s part. That’s why companies invest in employee training and technology to help the team deliver a consistent customer experience across all touchpoints. And it’s a good way, as happy and engaged employees lead to loyal customers.

Logistics trends in 2022

And the last on the list is logistics. This sector also shows interesting trends. For example, supply chain vulnerabilities force merchants to modify their fulfillment and shipping permanently. Supply chains are not the most exciting part of retail, but it’s probably the most crucial part that companies need to invest in. How you move your products around the globe is something brands need to address quickly. It’s a fluid moving space. Shipping delays, shipping costs, and manufacturing delays are the top supply chain-related concerns for businesses. Merchants are revising their manufacturing and shipping strategies, creating opportunities to lower costs and improve customer service. 43% of brands are changing shipping strategies to reduce the impact of global shipping delays. As challenges persist over the long term, businesses will look to build resilience into their supply chains with a renewed focus on digitization and decentralization.

Additionally, the social and environmental impact will define the next era of shipping and logistics. Consumer intentionality has shifted to action as more people purchase products from sustainably operated businesses. 53% of companies are making improved sustainability one of their top priorities for 2022. Merchants focus on improving their sustainability, including both their environmental and social impacts. Focusing on sustainability will ultimately position businesses for long-term growth. Companies that invest in sustainability through their supply chain will reap customer and employee retention returns.

Trend 3 tells that customers choose to shop with brands that are transparent around delivery times. Shoppers have been conditioned to expect fast, free, on-time delivery and abandon their carts if they are unavailable. 45% of shoppers are looking for businesses that clearly show anticipated delivery times. Customers say estimated delivery times are the top thing they look for before purchasing. Merchants plan on improving transparency into shipping and deliveries in 2022. Currently, 49% of the surveyed brands invest in their delivery practices and openness with their delivery promises, like sharing when an order is prepared and shipped. 

Over to you

As you can see, when third-party cookies are phased out, you need to get ready to experiment with new ways to deepen direct relationships with customers like live shopping, social media selling, video promoting. More digitally native brands will expand into physical retail than ever before, leading to a new phase of omnichannel shopping. And new consumer expectations will change retail staff into experiential hosts. In addition, supply chain vulnerabilities are forcing merchants to alter their fulfillment strategies permanently, and customers demand more transparency and eco-friendly business models. And, of course, don’t forget about sustainability, as it will define the next era of shipping. So, to sum up – keep your eye on the most exciting trends in 2022!