Ecommerce has come a long way from its birth in the 1990s. From the dot-com boom and bust, to the SEO age, the rise of social media, and the impact of mobile, this industry has had a wild ride.

That ride is far from over. We are in the midst of still more changes. We cover five of them here.

1. Chatbots

More and more consumers prefer to interact with brands via text messages, messaging apps, and live chat compared to phone or email. One way, ecommerce brands are adapting to these changes in preferences is through the use of chatbots.

Chatbots offer automated responses to user’s questions so that they can gain access to information more quickly. Much like a dial-in phone menu, chatbots offer users answers to common questions. AI is changing the game, making it easier for chatbots to answer a wider variety of queries and opening up new possibilities.

According to 2017 research conducted by Ubisend, 35% of consumers explicitly want more chatbots. Of them, 69% like chatbots because they are capable of providing information instantaneously, and 21% feel that chatbots are the easiest way to get in touch with companies.

Chatbots don’t require users to install a new app to interact with the brand, instead integrating with platforms they already use like Facebook messenger and Skype.

Chatbots are being adopted at a staggering rate right now, with Gartner anticipating that by 2020 85% of customers will resolve all brand interactions without speaking to a human. A survey by Oracle found that 80% of respondents had deployed chatbots or would by 2020, and Grand View Research expects annual compound growth in the Chatbot industry of 24.3%, reaching $1.23 billion by 2025.

In the past, companies needed to develop their own chatbots, but a wide variety of platforms are now available for companies that can’t make the investment. For example:

  • IBM Watson: The most popular chatbot builder among 61% of businesses, Watson uses a neural network incorporating a billion Wikipedia words and is capable of understanding intent, entities, and dialogues. This is arguably the most powerful chatbot platform available, but it is developer-heavy.
  • Aivo: Agentbot offers automated customer service on messenger apps, text messages, and through live chat on your website. Their Live service acts as a copilot for human agents, building profiles on users and providing that information to agents if the customer needs to talk to one. Voice chatbots are also available for phone interactions. The system integrates with Zendesk, Salesforce, Hubspot, Zapier, and Genesys.
  • Botsify: A no-code-necessary platform for smaller companies building chatbots quickly that are built for your website and Facebook. Integrates with WordPress, Shopify, Zapier, and Alexa. Use machine learning to teach your chatbot new sentences over time by telling it which questions it interpreted correctly or incorrectly.
chatbot

2. Growing international markets

The World Trade Organization estimates that international trade will continue to grow by 4.4% in 2018. According to research by Euromonitor International, ecommerce is expected to be the fastest growing global retail channel through 2022, anticipating 73% growth. Expansion of the food and drink subcategory is expected to grow fastest, at 80%.

Just over half of urban Chinese citizens have ordered overseas yearly, with 89% of them having bought from American retailers. Quality and authenticity were common reasons cited for buying overseas, while delivery time, payment security, and shipping costs were cited as the primary barriers.

Research by Nielsen also found that, globally, the majority of shoppers (57%) had made an overseas purchase in the past six months. The only continent where this figure wasn’t a majority was North America, where 45.5% answered they had made an overseas purchase.

As more money opens up on the international scene, smart ecommerce brands will adapt by targeting emerging global markets, especially those in Russia, Brazil, Turkey, Indonesia, India, Netherlands, and Singapore. Investment in language internationalization, shipping costs, shipping speed, and payment security will pay dividends.

us china transactions

3. Sellers moving beyond Amazon

Amazon’s share of the ecommerce market is massive, making up 49.1% of all US online retail spending. They are expected to earn a staggering $258.22 billion in retail sales by the end of 2018, or 5% of all retail sales combined.

But it would be a mistake to think that this means Amazon is the only option for third-party sellers and manufacturers, when the reality is that more and more options are opening up for sellers.

Marketplace sellers account for 50% of the units sold on Amazon, revealing their important market position, and the ecommerce market as a whole is growing faster than Amazon’s market share. That means more options for sellers despite Amazon’s dominance.

Platforms like ChannelApe open up options for sellers by handling drop shipping and allowing them to manage catalogs across multiple marketplaces like Amazon, Walmart, eBay, Target, Jet, Newegg, and others. Walmart’s 63% jump in sales in Q1 of 2017 was largely attributed to them opening up their doors to third-party sellers, and while some controversial sellers have caused them to tap the brakes more recently, the number of sellers is still growing, and likely to pick up pace again once the approval process becomes more streamlined.

While half of Amazon’s sellers are exclusive to Amazon, a third of them planned to expand to Walmart in 2017.

Crucially, despite Amazon’s dominance, successful sellers are earning revenue on their own sites. A study by eCommerceFuel found that 70% of sellers were earning the majority of their revenue from their own storefronts, while Amazon accounted for only 6.2% of their sales. Another 20% of sellers earned 76% of their revenue from Amazon.

More importantly, of the fastest growing sellers, only 27% reported Amazon as their top channel, and 43% weren’t even selling on Amazon. These polarized results suggest that sellers should diversify their revenue sources as much as possible, rather than focus all of their attention on Amazon.

Ecommerce Best Practice Guide

4. Evolution of ecommerce search engines

Apart from improving seo for ecommerce websites through the use of good platforms, keyword research, technical SEO, and link buliding, ecommerce sites must also think of themselves as search engines. A full 49% of online shoppers turn to Amazon first for product search, and the effectiveness of Amazon’s product search capabilities likely play an important part in that.

According to research by Nielsen, ecommerce sites have seen dramatic improvements in search capabilities in recent years. Search success rates in 2000 and 2011 were only 64% and 74% respectively, but search success rates in 2017 were a much better 92%.

The most important change has been an improvement in the search algorithms on these sites, which once required people to use advanced search operators instead of natural language. Modern users expect to be able to use natural language and no longer know how to use search operators. Ecommerce search engines should naturally understand when to insert “AND” and “OR” operators between words, without asking users to do this work for them.

Modern searchers also expect to be able to sort search results by weighted review scores rather than raw review scores. Weighted review scores rank results higher not just if they have higher scores, but if they also have more overall reviews and are thus more likely to be trusted.

Users expect faceted search, the ability to limit their search results by filtering them to relevant categories, and users complain when this option is not available. Automatic search suggestions are also expected.

From a design perspective, searchers now tend to look for a wide empty text field or a magnifying glass near the top of the page, in the center or the top right.

Ecommerce sites with poor search engines that can’t meet the above expectations, that have no support for spelling errors and synonyms, and that return nonstandard results pages with no filters or sorting capabilities will not be successful in today’s landscape.

search icon

5. Voice commerce

Twenty percent of US adults now own a smart speaker like Amazon Echo or Google Home. Out of them, more than a third have ordered groceries or toiletries, and 22% of them are doing so frequently. The most frequent buyers tend to add items to their cart over time and make the purchase later, rather than simply making the purchase outright.

Emarketer expects the number of US smart speaker owners to reach 69 million in 2018 and 75.5 million in 2019. Gartner anticipates that 20% of web browsing will be done without a screen by 2020.

For sellers, this means that while diversification is important, being available and competitive on platforms like Amazon Prime and Google Express will become increasingly necessary, and developing apps for these devices is likely to become an important marketing channel in the coming years. Success outside of these ecosystems will also increasingly rely on a brand’s ability to market and effectively communicate their unique selling proposition.

amazon echo

Conclusion

As the digital landscape continues to evolve, successful ecommerce marketplaces, platforms, and sellers will need to keep their eyes on the future and adjust accordingly. Leveraging chatbots for customer service, taking advantage of emerging global markets, diversifying outside of Amazon, improving site search, and adapting to the rise of voice commerce might just keep you ahead of the game.

The state of voice search in 2018