E-commerce is booming! … or not anymore?
It´s well known that the Corona pandemic has given e-Commerce a strong push in the last years. But how does it look in the first year “after” the pandemic?
e-Commerce in Germany in 2022
In 2022, online retail as a whole was faced with major challenges – inflation, price increases and thus consumer restraint were decisive for declining sales. According to a study by IFH Cologne on online retail, there was a 2.1% drop in development compared to 2021. Compared to the pre-Corona year 2019, however, there was still an increase of 40%.
“The crisis year 2022 puts a small damper on the online boom, mainly due to spending shifts. This will probably change again in 2023. Because if the overall economy turns out to be more positive again, this will also have an effect on sales growth in online retail – in our various scenario variants, we expect positive growth rates until 2026,”
so Hans-Jürgen Heinick, an online market expert at IFH Cologne.
The estimated turnover in e-commerce last year was around $5.8 billion. In a country comparison of sales, Germany was only in sixth place behind China, the USA, Great Britain, Japan and South Korea. (source: statista.de)
The current crises naturally have an impact on people’s propensity to consume. In Germany, sales in the electronics, books and entertainment sectors in particular fell below those of the previous year. The food and medicine sectors remained stable. Toys and large household appliances even increased.
Another trend last year was buying via smartphone – so-called mobile-commerce or buying via social media platforms.
To keep up with this, here are the 5 biggest trends expected for the next year:
5 e-Commerce trends for 2023
1 mobile commerce, omni-channel & social commerce
Sell your products on different channels – mobile and in store if possible.
In particular Mobile commerce is becoming increasingly important. Currently, 7.26 billion people use smartphones. For 2026 even 7.5 billion are predicted. More and more people are therefore buying or researching products with their mobile phones. In stores, a desired product is not available in the right size or colour – so people look for it online and order it directly through their mobile phones. Every online shop should be prepared for this. It is particularly important to have a website that is optimized for mobile phones – especially in terms of navigation, loading times and usability.
But also social commerce is growing more and more. This refers to the direct sale of products via platforms such as Instagram or Facebook. In the USA, social commerce brought in about 39.5 billion USD in sales. The use of social media has been increasing rapidly in recent years and, at the latest with the Meta Verse, more intensive influence is being exerted on this again. It is not sure, that selling through Instagram Marketplace will be as successful in Germany as it is in the USA, because a new Version of the App will replace the Marketplace Icon. But the function to sell through it will remain.
This is associated with a corresponding omni-channel presence. People want to have the opportunity to physically try products, but still read online reviews about them and inform themselves about possible alternatives. More and more people are therefore taking advantage of the opportunity to pick up, exchange or return their online orders in-store.
2 independence from marketplaces
Be independent of big marketplaces!
Hand in hand with this goes independence from large marketplaces like Amazon. D2C – direct-to-customer sales – is booming. You should use your own online shop to create a bond with the brand and so are your customers. People’s focus is now more on VALUE and BRAND BUILDING rather than indiscriminate consumption.
3 artificial intelligence
Improve the “customer experience” using creative and intelligent technologies.
People want to be addressed directly and met on personal base. Therefore, improve your customer experience by using chat bots, for example. These are always available and increase your sales figures if they are used correctly. In stores, there are salespeople who can advise or help during the customer journey, but online they are missing. People are more likely to buy when they have all relevant information they may need. Using chatbots is a simple method for you which also reduces the costs for customer support.
Furthermore, personalized advertisements are gaining in importance. If interested people are addressed directly and personally about a problem/good, they are more likely to see the solution/fulfilment in the corresponding product and are therefore more willing to buy. So put some effort in designing personalized ads.
Pay attention to what your company stands for and how sustainability can be actively lived.
Sustainability can no longer be considered a trend. Rather, it is a necessity for a company to position itself accordingly.
Two-thirds of millennials are paying increasing attention to sustainability factors – both in terms of products, services and companies themselves. This is likely to be even more the case for the following generations. For example, it is becoming more important how returns or packaging are handled or which companies are actively committed to environmental protection.
But hardly any other industry has such a hard time with sustainability as online retail. So what can you do? Besides paying attention to your supply chain and, if necessary, creating CO2 compensation by planting trees, you should pay particular attention to the right packaging.
Did you know that different recycling laws apply in different European countries?
If you sell products to different countries, you are obliged to comply with these rules and to license your packaging accordingly. This way, these countries can plan and deal with your “waste” accordingly.
If you need help to take a first step towards more sustainability – and to license your packaging accordingly – we will be happy to help you:
and last but not least …
5 brand building and individualisation
Build your own brand and be individual.
Based on the previous points, there is an increasing focus on brand building and individualization. People don’t just want to order products, they want to know where they come from. There is also more and more emphasis on what the company as a whole stands for.
In summary, it can be said that e-commerce continues to boom and the trends from 2022 are also gaining relevance in 2023.
It is understandable that these numerous developments can be overwhelming for small online retailers. So it could be helpful to focus on small steps and start with the “low hanging fruits”.
So why not directly ensure more sustainability in shipping and find out whether you still have capacity here? We are happy to help!