LTVplus

7 trends that will impact your e-commerce sales in 2021

Customer Service, E-commerce 10 min read

With growth marketing strategies becoming more widely used by e-commerce businesses, in 2021, e-commerce brands will have to put more effort into acquiring new customers as well as retaining the existing ones.

Below are just some of the e-commerce trends that will continue impacting sales in eCommerce in the years ahead – artificial intelligence, mobile apps, big data, and VR.

Divante Report
Source: Divante Report

In this article, we will explore the seven trends that will define the state of e-commerce in 2021 and which you will most likely hear about at all major marketing conferences the following months. You will also receive some tips on how to improve your online store performance to boost sales, regardless of whether you are managing a small e-shop or a big e-commerce brand. 

So, ready to make the future happen today? Then let’s get down to details!

1. Augmented reality 

Some e-commerce brands have already harnessed the power of augmented reality (AR) and its potential remains promising in 2021 and the years that follow.

What is augmented reality and what are its applications in eCommerce?

In simple words, AR is a technology that brings the virtual into a real-life environment with the use of visual elements, sound, and other sensory stimuli.

As analyzed by the Atlantic’s writer, the pandemic had catalyzed a number of AR projects to emerge, especially in the e-commerce space. As stores had to shut down due to the outbreak of COVID-19, shoppers were forced to buy online more frequently. 

When ordering online, the risk of choosing the wrong products is high—you can rarely guess the right product size or even predict whether the model will suit you. With virtual try-ons and AR technology, this is no longer a problem. 

For example, Instagram has recently launched their new product feature—Spark AR integration, which helps users try on products promoted on Instagram by brands. While this feature is not available to a wider public, it has been tested on a few bigger brands such as MAC Cosmetics or Ray-Ban. Hopefully, more brands will have a chance to offer the same to their customers on Instagram in the near future.

Thanks to Spark AR, you can try on a new lipstick as in the example below. 

Instagram Screenshot
Source: Instagram

For other fashion brands, this technology makes it easy for their followers to try on clothes promoted on this social media channel. Also, people buying furniture online can use Spark AR technology to find out how a new armchair will fit in their apartment alongside the rest of the room’s furniture.

2. Subscription model 

Winning new customers is more time-consuming and is becoming increasingly more expensive than retaining the existing ones. That is why a lot of e-commerce brands prefer to integrate a subscription model to complement one-off purchases. This way, they can increase their customer lifetime value and spend less energy and marketing budget on acquiring new business.

There are a few well-known examples of subscription businesses that have revolutionized e-commerce sales. Haven’t you heard of the Dollar Shave Club that sends razor sets as a subscription?

Dollar Shave Club Screenshot
Source: Dollar Shave Club

Here are a few more:

  • Huel – an e-commerce brand selling “nutritionally complete” meals. They offer both one-off purchases and subscriptions.
  • Fine Taste Club – a surprise box with tasty goodies delivered every month.
  • KiwiCo – subscription boxes for kids designed to fit the educational needs of children in different age groups.
  • Singles Swag – a box filled with different beauty products for ladies delivered to you monthly

The subscription model has its own weaknesses – one of them is churn and failed payment recovery. Often, customers churn due to payment issues—this causes e-commerce revenue to slip through the cracks. 

Pro tip: You can check how much revenue your subscription business is losing every month with this calculator.

An important step in fighting this problem is incorporating solid customer support processes and getting customer support agents to restore failed payments with actionable outreach campaigns. 

Check out how we are employing dunning payment strategies for subscription businesses or learn how dunning payments can be prevented with these proven dunning payment templates.

LTVplus eBook

3. Mobile experience

Every year, when some report on marketing trends is issued and the significance of mobile experiences is mentioned as a trend, marketers start making jokes about another year in marketing proclaimed as a year of mobile. It seems that 2021 won’t be any different, as the importance of mobile experiences is going to persist. For e-commerce, in particular, mobile payments will continue to be one of the most prominent trends.

In 2021, the volume of mobile payments will increase to $274,4 billion dollars compared to $154,4 in 2019 (just two years difference!).

While paying with a mobile device is still a predominant trend in the Asian region, other countries are going to speed up the adoption of this new technology. 

Apart from mobile payments, visual search will become another big thing even smaller e-commerce businesses should be aware of in 2021.

Let’s see how visual search works and what problem it solves for online shoppers.

Imagine there is a specific model of a sweater you want to buy. You have seen it in a magazine or on some website where the product’s brand was not mentioned. So you are heading to check across online stores to find that one model. After spending hours searching for your new sweater, you would give up, eventually not finding anything similar to the searched item.

The visual search takes this problem away! Just make a picture of an item you want to buy and algorithms will search among thousands of products in an online store to show you the most similar ones in just a few seconds.

For example, Neiman Marcus is offering shoppers a chance to upload a product photo and find similar products in their online store. Quite convenient, isn’t it?

Neiman Marcus Screenshot
Source: Neiman Marcus

In 2021, e-commerce businesses will try to integrate these and similar technological solutions for e-commerce to meet growing customer expectations towards online shopping. The mobile experience is way beyond just responsive mobile pages. Mobile in 2021 will mean more contextual search and precise product recommendations. So, have you already prepared a plan to boost mobile experiences in your online store?

4. Artificial intelligence

According to Accenture’s report, over 90% of buyers are expecting brands to offer personalized product suggestions tailored to their unique needs and previous buying history. 

Offering advanced and targeted personalization at scale is possible only with advanced technology that can handle a big amount of information at once. That is where artificial intelligence can support e-commerce brands in offering better product recommendations.

One of the forms of artificial intelligence, AI predictive model uses data mining to analyze information about previous customer purchases, compare it with other criteria, and predict what customers will eventually want to buy. The idea behind predictive models is rooted in learning from the past in order to predict the future – by literally reading customers’ minds. 

By analyzing thousands of previous purchases and customer profiles, predictive models can show the best possible product choices for any customer visiting a store. Moreover, predictive models can “guess” who is more likely to abandon a shopping cart. Brands can use this to provide the right incentives to churning shoppers such as discounts or time-limited offers. 

Check out the example of North Face using IBM Watson technology to help customers choose a perfect jacket.

North Face Screenshot
Source: North Face

North Face is asking a couple of pre-qualifying questions to understand user preferences and the conditions in which they are going to use the jacket. Then AI compares weather conditions for a user’s location, analyzes previous buying history, and viewed products to finally narrow down the jacket options to just a few. This way, a user can save lots of time scrolling hundreds of available jackets in the North Face’s online store.

5. Dynamic content 

Dynamic content is another tool an e-commerce business can use to personalize shoppers’ experiences and offer the products that are best suited to the clients’ needs and preferences.

For example, by collecting the information on customers’ previous interactions with your store, you can adjust the product offering on the main page to make it more relevant. You can also suggest complementary products to the items that a customer has already ordered during their last visit.

There are multiple places where you can apply dynamic content – product descriptions, page widgets on product pages, or even exit popups – with the technology available, literally every part of your store can contain dynamic content. 

Most importantly, you can show dynamic content that is varied depending on your user’s score or tag. In this case, a lead who is visiting your store for the first time should see different product suggestions compared to a customer whose cart value amounted to $10,000 during the last month.

Check out this example of how one can adjust a product description based on the information collected about a customer in the past.

Nosto Screenshot
Source: Nosto

6. Content marketing and social media 

By writing educational content related to the challenges your product solves, you can attract the right leads with high buyer intent. In 2021, retail brands will continue experimenting with blog content, video marketing, and even quizzes to attract potential buyers to their online stores.

For example, writing blog posts and optimizing them to rank high on Google, has helped Beardbrand become a prominent success story of content marketing in e-commerce.

They create informative content pieces that educate their male audience on grooming and even incorporate quizzes for a higher user engagement in their articles.

Quizzes help Beardbrand to collect initial information about user preferences and characteristics – for example, by asking questions about current hairstyle or a type of preferred grooming products – and to stay in touch with the leads that sign up for a newsletter. 

Beardbrand Screenshot
Source: Beardbrand

After filling in the quiz and signing up for a newsletter, users can receive emails that relate to their quiz answers – dynamic emails. For example, in a newsletter, e-commerce brands can showcase the products that a user has marked as preferred when answering questions from the quiz as this will increase the chances for a future purchase.

7. Interactive Chatbots

E-commerce businesses have been using chatbots to establish deeper and more personal relations with their customers. Chatbots have offered a way to educate a customer on new offers, reduce time spent on customer service inquiries, and show product options that are better suited to customer preferences.  

In 2021 more brands will continue adopting chatbot technology – according to the Outgrow study, 80% of businesses are going to follow suit.

Chatbots will become more human and provide users with more precise answers to online inquiries requiring less engagement from customer support. One can even presume that over time clients won’t distinguish a chatbot from a human-being!

In particular, travel and retail businesses can benefit from bots. Let’s examine an example from the travel industry.

When planning a trip, one is ready to dedicate hours to filtering possible options of accommodation. While the experience of getting ready for a trip and choosing from different options can be exciting for some, there are many travelers who would much rather find their accommodation faster, and hassle-free.

Chatbots can help users save time by suggesting the best accommodation option within seconds.

For example, Snaptravel shows the most suitable offers after searching and selecting among hundreds of possible options to match a defined city, budget, dates, and client preferences.

Snaptravel Screenshot
Source: Snaptravel

Apparel brands have already been using chatbots for quite some time starting with some simple-logic chatbots to advanced ones using artificial intelligence. 

With more scenarios available to engage with customers, brands are attempting to enrich user profiles with more information – such as user location and budget. This is especially important for retail brands that have physical shops in different cities.

For example, Burberry is using an interactive bot to not only show the collections a visitor would be interested in, but also collect some information on the user’s location to provide personalized offers by city and local currency.

Facebook Screenshot
Source: Facebook

Recap

So, you made it this far? Awesome! In this article, you have learned about the seven crucial trends in e-commerce for 2021 that will impact your sales next year.

Let’s recap them!

  1. The importance of augmented reality in e-commerce will increase as online shoppers will be looking for technology to help them try on products virtually. AR tools will also help make a better buying decision without leaving home.
  2. The rise of the subscription model in e-commerce will help brands increase customer lifetime value and make sales more predictable.
  3. Visual search in e-commerce will assist consumers in finding their desired products in a glimpse of an eye. Easier mobile payments will make purchases faster and more effortless.
  4. AI predictive models will provide customers with the product suggestions that fit their preferences the best – literally reading their minds.
  5. More brands are going to adopt dynamic page content to make their user experiences more personalized and tailor a message to a specific customer based on their previous purchase history.
  6. E-commerce content marketing will continue to remain a key trend with e-commerce brands using both video, text, and quiz content to educate leads and drive their purchasing decisions.
  7. E-Commerce chatbots will become more ‘human’ and provide more targeted and precise information to user queries, thus helping make buying decisions faster.

Need a dedicated customer experience team ready to support your brand?

Book a consultation with us and we’ll get you set up.

Digital Marketing Manager @LTVplus Actively participating in the digital marketing world for more than 5 years. Currently making sure that our website content is up-to-date and our blog is filled with actionable tips and advice for online retail businesses. Very passionate about dogs, topics on spirituality and Unicorns.

Leave a Comment