6 ways eCommerce will change in 2019

6 ways eCommerce will change in 2019

9 November 2018

Online shopping is booming worldwide, with global retails sales expected to surpass A$6.7 trillion by 2021, and Australians have been quick to adopt the trend.

The online shopping industry in Australia is worth $23 billion and is growing at a much more rapid rate than traditional retail, reports the AFR.

The Australian Bureau of Statistics estimates that one in every $20 is spent online, notes the Sydney Morning Herald. And the future is bright. Australia Post expects that by 2020, one in 10 items will be bought online.

So, what new eCommerce developments might the coming year bring?

1. Marketplaces will continue to grow

Amazon and eBay will continue to fight for eCommerce dominance in Australia, but marketplaces—central platforms where goods are offered by multiple third parties—will continue to grow.

Retailers such as Catch, Etsy, Redbubble, and Myer have recently opened marketplaces, recognising the benefit of increased customer traffic and expansion into other categories.

Utilisation of third-party delivered inventory and logistics for Amazon (including Fulfilment by Amazon) will increase as retailers look to take advantage of their growing loyal customer base and find efficiencies in servicing this market.

In terms of attracting consumers to buy on marketplaces, we will see new channels such as Voice Commerce powered by Amazon Alexa begin to really gain traction.

2. Automation will be key

Automation of inventory and fulfilment across sales channels will become increasingly important, especially with the rise of marketplaces and new ways of buying such as social and voice commerce.

Efforts to manually manage operations across e-commerce, marketplaces and physical channels will become near-futile, and businesses that look to automation will be the ones that survive in an ever-increasing competitive environment.

3. AI, AR and Chat Bots will secure their place in retail

In 2019, augmented reality with practical applications will start to make inroads both in store and in home.

Augmented reality refers to technology that superimposes a computer-generated image on a user’s view of the world, creating a composite view.

AR allows customers to experience their desired purchases outside of the physical store location. Customers have the ability to move objects, place them in different settings, and try certain concepts and applications before making the final decision to buy.

For example, IKEA’s Place app lets customers virtually ‘place’ furniture in their space. The products are true to size, helping consumers make better choices.

Chat bots—computer program designed to talk to users—will be another technology that finally finds its place, relieving customer service agents from performing grunt work such as order status updates or retrieving shipping tracking numbers.

Microsoft is just one of several companies that sell a range of AI solutions to businesses with a particular focus on using chatbots to help with the sales and marketing process.

Already some 660 million people use Microsoft bots across the world, with 120 million on average doing so each month. The average conversations with one chat bot involved 23 messages sent back and forth, and the longest recorded conversation session went for 24 hours, reports the AFR.

This type of artificial intelligence and machine learning won’t take away jobs like some media outlets might have you believe; instead it will empower SMBs to shift their limited resources to strategic growth activity.

4. Smart home digital assistants will power voice commerce

The growth of smart digital home assistants such as Amazon’s Alexa, Google Home and Apple’s Home Pod will also influence the way many customers shop in the future.

Mobile searches for “where can I buy” grew 85 per cent in Australia over the past two years. Meanwhile, 44 per cent of those who use a voice-activated speaker, said they use the device to purchase groceries and household items at least once a week.

US company eMarketer estimates people using voice assistants will grow to 76.5 million in 2019. Retailers will need to optimise their product catalogues to tap into this growing market.

They will likely do this by leveraging marketplaces such as Amazon and eBay through voice channels.

5. Unique, personalised experiences will win out over discounting

Personalised shopping experiences will trump those that focus on short-term strategies such as discounting or product diversification.

With the integration of machine learning and AI, a growing list of low-cost solutions are now readily available for small retailers to adopt, empowering them to compete with the likes of Amazon and eBay on this front.

6. B2B eCommerce will dwarf B2C

Retail eCommerce gets most press coverage, but more than 65,000 companies in Australia currently target wholesale customers and sell business-to-business (B2B).

According to the Australian Bureau of Statistics, wholesale business generates around $495 billion in income each year, versus the $380 billion made from retail transactions. Meanwhile, global B2B eCommerce revenue is expected to reach $6.7 trillion (USD) by 2020.

We can expect to see smart B2B wholesalers grow their businesses faster and manage all channels through one integrated platform, centralising operations and improving efficiencies from inventory to fulfilment.